April 2025Each quarter, where appropriate, RVK utilizes peer group data to provide clients with a comparison of similar funds’ performance. Each client group listed is comprised of funds under the same category; the broad All Master Trust category includes Corporate, Healthcare, Taft Hartley Defined Benefit, Health & Welfare, High Net Worth, Insurance, Operating Reserve... |
March 2025In 2025, investors are once again faced with the risks associated with a top-heavy, concentrated US equity market. Following outsized gains in 2023 and 2024, the US mega-cap segment has only climbed higher even as competitive forces, regulatory scrutiny, rising expectations, and... |
February 2025Introduction: Every calendar year, RVK produces long-term, forward-looking capital market assumptions through a rigorous, multi-step process, which draws on both quantitative economic and financial inputs as well as qualitative comparisons and analysis. Our return estimates are generally based on return decomposition models, which consider factors such as income, future growth, valuation... |
January 2025Each quarter, where appropriate, RVK utilizes peer group data to provide clients with a comparison of similar funds’ performance. Each client group listed is comprised of funds under the same category; the broad All Master Trust category includes Corporate, Healthcare, Taft Hartley Defined Benefit, Health & Welfare, High Net Worth, Insurance, Operating Reserve, Public, and... |
January 2025Active Extended Equity strategies begin with the basic idea of relaxing the constraints around a long-only active portfolio or passive index by introducing a short selling component that takes advantage of both positive and negative company information. At the same time, the portfolio... |
January 2025Since 2014, RVK has collected data from our defined contribution (DC) clients to construct an annual peer group survey of plans of varying types and sizes. The survey focuses primarily on fee data, spanning across investment manager, recordkeeping, administrative, and participant fees. Over the last ten years, we’ve observed... |
October 2024Each quarter, where appropriate, RVK utilizes peer group data to provide clients with a comparison of similar funds’ performance. Each client group listed is comprised of funds under the same category; the broad All Master Trust category includes Corporate, Healthcare, Taft Hartley... |
October 2024Harry Markowitz, Nobel Laureate and creator of modern portfolio theory, is credited with the famous quote, “Diversification is the only free lunch in investing.” Diversification is a fundamental best practice for any investment allocator. However, diversification benefits across asset classes... |
September 2024Transferring risk from the insurance policy holder to the insurer puts every insurance customer in the position of being a creditor, so the perception of creditworthiness is key to the viability of an insurance business. Expert assessments of creditworthiness in the form of credit ratings by... |
July 2024Each quarter, where appropriate, RVK utilizes peer group data to provide clients with a comparison of similar funds’ performance. Each client group listed is comprised of funds under the same category; the broad All Master Trust category includes Corporate, Healthcare, Taft... |
June 2024RVK has observed a consistent theme in recent meetings with US small cap and SMID (small and mid) cap equity managers—primarily on the growth side. Market concentration is not reserved only for US large cap, and the return contribution of two specific companies... |
May 2024For over 30 years, RVK has published a semiannual Public Funds Report, summarizing survey data from public pension plans (“public funds”) across the US. The public funds included in our reports range... |
April 2024Each quarter RVK utilizes peer group data to provide clients with a comparison of similar funds’ performance. Each client group listed is comprised of funds under the same category; the broad All Master Trust category includes Corporate, Healthcare, Taf... |
March 2024While we are wary of predicting an exact value, given the complexity of markets and the number of assumptions involved, we are comfortable putting the current market environment into historical context and providing some broader observations... |
March 2024There have been two major US stock market trends frequently discussed in recent client and investor meetings: stock market concentration and the resumed leadership of growth stocks in 2023. The drivers and potential reversal of these trends are key topics within... |
February 2024Every calendar year RVK produces long-term forward-looking capital market assumptions through a rigorous multi-step process that draws on both quantitative economic and financial inputs as well as qualitative comparisons and analysis... |
January 2024Each quarter RVK utilizes peer group data to provide clients with a comparison of similar funds’ performance. Each client group listed is comprised of funds under the same category; the broad All Master Trust category includes Corporate, Healthcare, Taft Hartley... |
January 2024Over the past decade, investment managers of all styles have grappled with the issue of investing in China, a country that represents significant exposure within emerging markets equities and presents unique geopolitical and governance challenges. Views on investing.. |
October 2023Each quarter RVK utilizes peer group data to provide clients with a comparison of similar funds’ performance. Each client group listed is comprised of funds under the same category; the broad All Master Trust category includes Corporate, Healthcare, Taft Hartley Defined Benefit, Health & Welfare, High Net Worth, Insurance... |
August 2023Below is our assessment of the US debt rating downgrade by Fitch as of the date of publication, August 4, 2023. We will continue to monitor the situation as it evolves... |
August 2023Each quarter RVK utilizes peer group data to provide clients with a comparison of similar funds’ performance. Each client group listed is comprised of funds under the same category; the broad All Master Trust category includes Corporate... |
July 2023The drivers of price movement in public markets are forever shifting and are often difficult to discern and isolate. The first half of 2023 is no exception, as many forces continue to impact investor decisions and market results. However, there is one trend that has garnered significant attention: the largest index holdings in the US stock market... |
June 2023With the yield curve still inverted, we are often asked about the potential for a recession and the magnitude of its impact on capital markets. While there is significant uncertainty about the path of capital markets over the short term, we continue to believe the best approach for strategic investors is to focus... |
May 2023Each quarter RVK utilizes peer group data to provide clients with a comparison of similar funds’ performance. Each client group listed is comprised of funds under the same category; the broad All Master Trust category includes Corporate, Healthcare, Taft Hartley Defined Benefit, Health... |
May 2023For over 30 years, RVK has published a semiannual Public Funds Report, summarizing survey data from public pension plans (“public funds”) across the US. The public funds included in our reports range in size from less than $500 million to over $20 billion, providing a comprehensive view of the public... |
March 2023Below is our ongoing assessment of Silicon Valley Bank (SVB), Signature Bank (Signature), and the broader banking system as of the date of publication, March 14, 2023. We will continue to assess the situation as it evolves... |
March 2023Every calendar year RVK produces long-term forward-looking capital market assumptions through a rigorous multi-step process which draws on both quantitative economic and financial inputs as well as qualitative comparisons and analysis. Our return estimates are generally based on return decomposition models... |
February 2023The following is an overview of recent and longer-term active management trends in US equity markets. Over the past 20 years, large- and mid-cap managers, primarily in the growth and core spaces, have struggled to generate excess returns relative to their respective benchmarks over rolling three-year periods... |
February 2023Each quarter RVK utilizes peer group data to provide clients with a comparison of similar funds’ performance. Each client group listed is comprised of funds under the same category; the broad All Master Trust category includes Corporate, Healthcare, Taft Hartley Defined Benefit, Health & Welfare, High... | December 2022Surveys of economists and fund managers, as well as forecasts from economic think tanks, increasingly point to a growing likelihood that the US economy could face economic contraction sometime in the next year. The Conference Board predicted in October of 2022 that there is a 96% probability of recession... |
November 2022The following is an overview of recent economic and broad market events that may lead to disruptive expected cash flow patterns in our client’s open-ended real estate funds. In 2022, the public equity and debt markets experienced elevated levels of volatility and weakness. Year to date, private real estate... | November 2022Each quarter RVK utilizes peer group data to provide clients with a comparison of similar funds’ performance. Each client group listed is comprised of funds under the same category; the broad All Master Trust category includes Corporate, Healthcare, Taft Hartley Defined Benefit, Health & Welfare, High Net Worth... | September 2022The correction among growth stocks in the US equity market has been swift. Investor sentiment has rapidly moved away from stocks with prices tied to above average long-term growth forecasts. This change has occurred in an environment... |
September 2022One of the inherent reporting challenges of illiquid investments, such as private equity (PE), is how to incorporate quarterly private valuations into total portfolio performance. The longer the private market valuations take... |
September 2022Each quarter RVK utilizes peer group data to provide clients with a comparison of similar funds’ performance. Each client group listed is comprised of funds under the same category; the broad All Master Tru category includes... |
August 2022The COVID-19 pandemic has meaningfully altered many of the ways RVK conducts its business on a day-to-day basis. Conducting manager research is no exception. At the onset of the pandemic, when nearly all the financial services industry shifted... |
July 2022The US Consumer Price Index (CPI) increased by 9.1% over the past 12 months ending June 30, 2022. While inflation has been elevated in the US over the past several months, the June inflation report was the largest 12-month increase since... |
June 2022The shift to passive management of public equities is well documented in the institutional investing landscape (see Figure 1). Although numerous rationales exist for this trend, the most common explanations include... |
February 2022Equity market volatility has returned to the top of investor concerns following the correction caused by the Covid-19 pandemic and the recent equity market drawdown in the midst of persistent inflation and tightening monetary policy. In normal market conditions, it can be difficult for investors to remain... |
June 2021Objectively measuring a diversified investment portfolio's performance seems like a straightforward endeavor, but it has become increasingly complicated over the years. The purpose of this paper is to assist asset owners and fiduciaries in the selection and interpretation of benchmarks used to measure total... |
February 2021Rebalancing a portfolio at the multi-asset level is a well understood and widely utilized tool by strategic long-term investors to keep the total portfolio close to chosen risk and return targets and intended levels of diversification. An appropriate rebalancing policy serves to narrow a portfolio's range... |
June 2020Given the extent of the recent, pandemic-driven economic and market disruption and the highly levered state of most US corporate borrowers, we expect that a large and sustained distressed debt cycle is likely to emerge over the course of the next year. In past periods of economic stress, the inefficient... |
April 2020Concerns over the potential impact of the COVID-19 pandemic on a wide range of company and asset-oriented cash flows resulted in a sharp, technically driven sell-off across a wide range of credit assets in March of 2020. The forced outflows and lack of market buyers behind this sell-off has largely driven... |
April 2020The recent establishment of the second Term Asset-Backed Securities Loan Facility (TALF) presents credit investors with a range of new and potentially compelling opportunities through the Federal Reserve's provision of extremely low-cost financing for investments in a select group of high quality... |
April 2020Much has been written about the effect of COVID-19 on investment markets and it is likely that there will be considerably more to come. Most of what has been written has focused on immediate and near-term impacts. We would like to turn our focus to potential long-term... |
March 2020We realize that recent weeks have provided you with COVID-19 related commentary of all sorts, and of varying relevance. As committed co-fiduciaries, our goal is to partner with you to help your investment strategies align with your purpose, goals, and objectives. We hope you find this message focused, thoughtful, and relevant in providing perspective and insight during these uncertain... |
March 2020It is a difficult time for investors to remain committed to thinking strategically as market volatility, headlines, and the growing concern about COVID-19 dominate our daily lives. However, we would suggest that now is precisely the time for... |
February 2020This week, February 24 – 28, has been one for the record books in many ways. The S&P 500 fell 11.5% in just five trading days. The global equity market followed suit with the MSCI ACWI ex US index dropping 9.0%. Bond yields declined globally with the US 10-year... |
July 2019Institutional investors are forever looking for clues in the behavior of the fixed income market that might predict the future course of the economy - particularly the probability, timing and potential severity of a recession. In this search, all aspects of the fixed income market are fair game: the level of interest... |
April 2019In a recent edition of Investment Perspectives, we discussed a framework to use when constructing an equity portfolio. Two strategy types addressed therein, active and passive management, are both well understood within the institutional investment space. However, a third strategy type labeled... |
March 2019In most portfolios, a fixed income allocation is meant to provide stability, income, and liquidity to investors. However, fixed income markets are continually evolving, and that evolution may either increase or decrease their ability to deliver on those objectives over time. In many cases, this is a result of... |
December 2018As of the January 3, 2019 market close, the S&P 500 Index declined by more than 14% from the market peak reached on September 20, 2018. The sell-off in equities has been global in scope with the MSCI EAFE Index and the MSCI Emerging Markets Index declining by nearly 13% and 8%, respectively, since the start of... |
July 2018As investment boards continue mulling over the "active vs. passive" management debate, additional options that sit just outside the traditional equities space are resonating with some institutions. For those wary of surrendering higher fees for strategies constrained by tracking error and index weights... |
November 2017Successful management of institutional investment portfolios requires unbiased advice from multiple individuals and third parties. Key advisors include investment board/committee members, investment staff, investment consultants, fund managers, and custodians. Despite a robust regulatory infrastructure... |
April 2017Few investment topics invite more debate than the issue of active versus passive management. Investors pursuing active management seek to outperform comparative indices by investing in funds that attempt to exploit market inefficiencies. Passive investors, on the other hand... |
November 2016One of the most fundamental decisions for institutional investors is the extent to which to use active managers as opposed to low-cost index funds. The primary argument for using active managers is their ability to provide investors with enhanced returns. However, realization of this benefit assumes... |
July 2016Diversification is a fundamental component of an institutional investment strategy; however, determining the optimal approach invites considerable debate. This debate has intensified recently due to the fact that, for an extended period of time, portfolios with a traditional 60/40 allocation to US equity and US fixed income have outperformed many portfolios that include a broader set of asset classes... |
September 2015On July 23, 2014, the United States Securities and Exchange Commission (SEC) adopted amendments to rules governing U.S. money market funds. The amendments were designed to address unexpected distress experienced by money market funds during the global financial crisis of 2008 and 2009. During this period, one fund (the Reserve Primary Fund) became only the second money market fund in history to "break the buck"... |
August 2015Welcome to the inaugural issue of the RVK Global Real Estate Market Newsletter. The intent of this letter is to efficiently and concisely communicate what's on our mind. This may include current opportunities and where we view attractive relative value, real estate strategies we find... |
February 2015In 1974, the Employee Retirement Income Security Act (“ERISA”) was passed in order to establish a set of governing laws and regulations to protect the interests of participants in employee benefit plans. Since then, the responsibilities of defined contribution (DC) plan fiduciaries have continually evolved, and plan expenses in particular have become heavily scrutinized... |
October 2014Marketable alternative investments are generally used by investors to enhance portfolio diversification due to their tendency to exhibit low return correlations (and often low volatility) relative to traditional asset classes. Although the investment objectives, constraints, and risk tolerances of institutional investors vary substantially... |
July 2014The financial panic of 2008 and early 2009 sparked massive losses across virtually all asset classes. As is common during such periods, the crisis also created extraordinary buying opportunities—many of which involved traditional fixed income sectors. While the subsequent recovery... |
May 2014Nearly five years have passed since the end of the U.S. financial crisis. With the economy and capital markets appearing to stabilize over the past six months, the Federal Reserve has responded with a gradual reduction of its quantitative easing (QE) program, which is already leading... |
April 2014Over the past several years, academics, investment professionals, and investment firms have produced numerous papers about investment governance best practices. Interest in this topic is fueled by the fact that past research suggests that effective governance may add as much as 100 to 300 basis points to investment returns.1 While existing research... |