Navigating the Current Financial Landscape: Key Trends Impacting You Today

By John Furlow, TPF’s Executive Vice President

Recently, I had the opportunity to attend the Institutional Investor Education Foundation (IIEF) 2024 Event in Boston, MA. The IIEF is renowned for its commitment to enhancing financial literacy and promoting sound investment practices among institutional investors, and this event was a landmark gathering, focusing on crucial topics such as developed international and emerging markets equities, asset allocation strategies, and the impact of high interest rates on investment decisions. Attending were 150 non-profit investment professionals representing college & university endowments, family foundations, hospital foundations, and other non-profit foundations. Also in attendance were 150 institutional investment managers including representation from 16 of TPF’s current managers.

But why should you care about what happened at this event? The IIEF is dedicated to educating institutional investors on best practices, innovative strategies, and the latest market trends. By providing a platform for knowledge sharing and professional development, the foundation aims to empower investors to make informed decisions that drive sustainable growth and financial stability.

Key Trend Areas from the 2024 Event:

• Developed International and Emerging Markets Equities: There was a consensus that Emerging Markets have been held back by the availability of cheap and abundant funding available to domestic U.S. companies. Now that U.S. interest rates have increased and government subsidies are gone, both International and Emerging Markets Equities are on a level playing field. It is widely recognized that there is a place in a diversified portfolio for those strategies. Of course, one cannot ignore two of the largest economies in the world, China and India.
• Clear Communication of Organizational Purpose and the Impact of Your Investments on Your Mission: A multi-foundational forum reviewed the incredible work of non-profit foundations across the country. Environmental, Social, and Governance (ESG) investing is a key consideration. However, for many foundations like TPF, ESG is usually addressed at the manager level and not by the foundations themselves. Of course, there is universal focus on the best practices of stakeholder communication, including the conveyance of investment strategies and outcomes, along with key organizational values and objectives to stakeholders.
• Current Considerations Related to Asset Allocation: Decision making processes are currently impacted by higher interest rates, liquidity needs, etc. brought by the current market landscape. There is real disappointment in the performance of private market investments. But the main question is key— why pay the high fees and receive public equity-like returns at best?
• New Nonprofit Investment Offices: These offices continue to evolve with organizational structure designed to emphasize streamlined decision-making and effective management, staffing focused on diverse and expert teams, and flexible work hours that promote healthy-work life balance and an inclusive culture that encourages innovation, as well as professional growth.

The IIEF 2024 event in Boston was an enriching experience for institutional investors, offering valuable insights and practical strategies to navigate the complexities of modern financial markets. At TPF, we attend these types of events to ensure we remain on the leading edge of excellence and innovation in the field of institutional investment education. If you are interested in learning more, I invite you to view our informative webinar, The Word on the Street, August 2024: A Mid-Year Conversation on Investment Philosophy, Performance, & Perspective. Our team of experts hosts an interactive conversation focused on what’s happening now in our financial markets with a focus on real estate. Click here to register and view today!