||The Long/Short Equity strategy seeks to achieve long-term growth of capital. Its investment universe is primarily composed of large- and mid-cap US stocks, although the Portfolio opportunistically invests in non-US issuers and smaller-cap companies. Investments are unconstrained by style or sector. The Portfolio’s experienced investment team applies intensive fundamental analysis and macroeconomic insights to identify investment opportunities and potential short-sale candidates. These candidates can be characterized by their potential for earnings growth on a three- to five-year time horizon; their strong management teams and understandable, transparent business models; their emphasis on catalysts that could propel earnings, such as positive earnings revisions or dissipating investor fear about a given stock; their shareholder-friendly actions (e.g., dividends and share buybacks); and, in the case of short candidates, their short-term valuation concerns or long-term headwinds to their business model. The team’s process includes the flexibility to adjust the Portfolio based on evolving market opportunities, including by reducing its net exposure when market risk is excessive. Market exposure is typically 30%–70% net long.
||The Multi-Manager strategy offers portfolios (hedge funds of funds) as commingled funds and separate accounts. The commingled funds seek to provide attractive risk-adjusted returns over full market cycles with less volatility than that of the broad equity markets. The funds are selected by our Alternative Investment Management group, which has a long track record of successfully constructing and managing portfolios of external hedge funds and has achieved very strong risk-adjusted returns since inception. The team has a disciplined approach to manager selection that includes dedicated risk management and operational due diligence. The team uses proprietary and third-party quantitative tools to look at a combination of exposures and return information to capture the risk factors of the underlying funds as well as their combined risk in each portfolio.
|Real Estate Debt
||The Real Estate Debt strategy seeks to take advantage of limited competition and the liquidity gap stemming from traditional capital providers’ inability or unwillingness to underwrite transitional real estate credits in the face of significant maturities. The strategy purchases and originates first mortgage loans and loan participations secured by high-quality, transitional properties throughout the US. Transitional first mortgages generate quarterly or monthly dividend income for investors at sizable spreads to US Treasuries on an unlevered basis. Downside risk is mitigated by a rigorous credit process that focuses on fundamental real estate underwriting and control of the servicing of purchased or originated loans.
|Real Estate Equity
||The Real Estate Equity strategy provides access to direct US real estate investments through equity and/or debt. The strategy emphasizes acquiring controlling interests to resolve temporary distress. It seeks to create value through the restructuring, recapitalization, repositioning and reselling of stabilized assets, with a focus on fundamental, deep-value real estate underwriting and analysis. The strategy typically targets opportunistic investments with asymmetric risk/reward profiles and broadly diversifies investments across geographies and sectors as well as across investment vintages, deal sizes, operating partners and counterparty concentration.
||A highly liquid, long-only, multi-asset portfolio that dynamically allocates the portfolio by risk, not dollar, weights. The strategy is constructed to lose less in declining markets and generate strong risk-adjusted returns by balancing drawdown risk across growth-sensitive, safety and inflation-linked risk buckets. Risk parity strategies typically allocate capital so each risk bucket contributes equality to portfolio volatility, reducing concentration risk; these strategies also use leverage to achieve targeted volatility.
||The Securitized Assets strategy is designed to take advantage of an emerging set of investment opportunities in mortgage finance, and it seeks to provide attractive absolute-risk-adjusted returns through a combination of current income and capital gains across market cycles, principally through investments in mortgage-related securities. The strategy invests primarily in non-agency residential mortgage-backed securities, commercial mortgage-backed securities and agency mortgage-backed securities. It may also invest in other securitized assets, including asset-backed securities.