Strategies

The total return concept of management is utilized with an objectives-based approach to asset allocation that balances annual payout needs with the necessity of long-term growth.

“We are expected to deliver rates of return that will support the University in virtually any kind of economic or market environment. In an increasingly uncertain world, this is a tall order; but we believe we will continue to be up to the challenge. ”

Jim Hille
Chief Investment Officer

Our Philosophy

TCU Investment Management’s investment philosophy is based upon the belief that excess returns, relative to an appropriate benchmark, can be achieved to varying degrees in all asset classes through the implementation of active management and, more specifically, investment strategies that seek to benefit from less efficient market environments. Simultaneously, the philosophy assumes that a lower level of investment risk or volatility, relative to an appropriate benchmark, can be achieved through prudent diversification.

Our Primary Strategies

RETURN

Equity investments are the core return seeking assets, providing appreciation potential and growth of income with the understanding that volatility and some risk of loss must be assumed. Equity strategies will include but are not limited to domestic, international, and global long-only stocks, equity long-short marketable alternatives, and private equity.

ABSOLUTE RETURN

The requirement for an annual payout of approximately 5% each year necessitates that strategies be employed to mitigate the more volatile return streams, which requires total returns within this strategy to be positive in any given year with relatively low correlation to the broad equity market. Private credit and absolute return-oriented marketable alternatives are the core strategies.

INFLATION HEDGE

Strategies may be employed that have the specific purpose of offsetting the effects of inflation rather than seeking return for a given level of risk. The University’s mineral assets provide the core of the inflation hedging strategy with additional real assets such as real estate and commodities, energy private equity, inflation-protected securities (TIPS), and synthetic hedges.

OPPORTUNISTIC

The investment staff is expected to monitor and take advantage of evolving market situations that inevitably develop and provide timely and/or innovative investment opportunities. Cash may be allocated to this strategy for the purpose of opportunistically hedging market risks or for other risk management approaches.