Investment Metrics’ new plan universe report derived from the industry’s largest data set provides key insights about the institutional investment landscape

Pittsburgh, PA, March 1, 2023 – Investment Metrics, a Confluence company, the leading global provider of investment analytics, reporting, data, and research solutions, today released Q4 insights based on its flagship Plan Universe dataset known as Plan Universe Allocation and Return Analysis. The new report provides a snapshot for the institutional asset allocator market segment using data that can benchmark plan performance and asset allocation bets across peers. It explains the impact on broad plan performance for various institutional investor types and includes some hypothesis of the drivers that explain the underlying events.

Overall 2022 was a challenging year for most institutional investors and as we look at underlying data across the 1,500 Defined Benefit Plans we see that the calendar year median performance was negative (14.1%) compared to 2021 that was positive (14.6%). Interestingly though 4^th quarter performance did rebound whereby the median quarterly return for the same plans was a positive 5.2%. It appears that Corporate Defined Benefit plans have the worst plan performance in 2022 compared to some of the other Institutional Investors even with a comparatively large shift in asset allocation to the Fixed Income asset class.

Other highlights in the Q4 2022 report include the following:

• Public equity performance bounced back strongly in Q4 2022, with a median gross return of positive 10%. This comes after being in red for the first three quarters for public equity.
• The Real Assets/Commodities asset class median gross return for defined benefit plans was positive at 6.3%. Real assets/commodities were the best-performing part of the defined benefit portfolio in 2022.
• Alternative assets performed relatively better than public equities and fixed income asset classes.  Meanwhile, the Hedge Fund median return was negative 5.7%, therefore de-bunking the fact that Hedge Funds are truly a non-correlated asset class.

Plan Universe is the largest institutional asset allocator database in North America that provides data segmented by various institutional plan types (Corporate Defined Benefit, Public Defined Benefit, Multi-Employer Taft Hartley, Endowments, Foundations and Healthcare Operating Asset based plans) with additional segmentation using granular asset classes  (Equity (US, global, global ex-US), Fixed income (US, global, and global ex-US), Alternatives, Real Estate (public and private), Multi-Asset and Cash, with options to review various portfolio measures like Performance, Absolute Risk to name a few. It also offers the option to customize the Universe across Plan types using Total Assets and Asset Allocation filters for a true like-for-like peer comparison for a specific asset owner.

It includes a full set of gross and net performance and asset allocation data across more than 4,000+ institutional plans with over $4 trillion in total assets. The data set is the largest in the industry, sourced directly from the Investment Metrics Portfolio Analytics and Reporting solution that’s relied on by 80% of the top 20 largest institutional investment consultants.

Investment Metrics Plan Universe is the largest and most robust institutional plan-based peer group data of its kind, and the underlying peer data is sourced monthly directly from active portfolios that investment consultants and asset owners have on our platform. It enables standard and custom peer-group comparisons of performance, risk, and asset allocations by plan type and size.

Sanjoy Chatterjee, Chief Strategy Officer of Confluence and founder of Investment Metric

Even though US fixed income did not provide the same type of protection in years past when markets have fallen, they still provided better returns compared to public equities. As a result of the poor performance in 2022, many plans across all types will have trouble meeting their long-term target return figures.

Brendan Cooper, Head of Client Consulting & Research, Confluence