Investment Report

As of March 31, 2017

Tony MestresSeattle Foundation began 2017 with a strong first quarter of investment returns. While now eight years into what is the second longest bull market since 1928, the period saw continued strong equity returns as a sense of optimism about future economic growth was pervasive around the globe.

The combination of job growth and increased business and consumer confidence allowed the Federal Reserve to raise its key interest rate by one quarter of a percent in mid-March, the second time in four months. Also contributing to global optimism was positive inflation and job creation data from Europe, China and Japan. This optimism around economic growth translated to strong returns across all regions. The S&P 500 gained 6.1 percent on the quarter, yet notably lagged both Non-U.S. Developed Equities, which gained 7.2%, and Emerging Equities which gained 11.4% on the quarter.

The Balanced Pool, our largest investment pool, has maintained a diversified equity portfolio, as well as more conservative asset classes such as U.S. Fixed Income. It gained 5.0% on the quarter and 12.3% for the past 12 months. As noted in past reports, we continue to highlight execution of the strategy as the Balanced Pool outperforms its target benchmark by 70-110 bps (net of fees) over the latest 1-, 3-, 5-, and 7-year periods. Much of this success is attributable to active management in the equity space, as well as strong performance in alternative asset classes.

Our Socially Responsible Pool, designed to meet environmental, social, and governance issues while also providing competitive economic returns, gained 4.8% for the quarter. Our Intermediate-Term Pool gained 1.8% this quarter and has gained 3.9% over the past 12 months. The Short-Term Pool gained 0.2% on the quarter. Lastly, we report for the first time on two new pools. The Index Pool, which is all passive, gained 4.3% this quarter while our Growth Pool, which holds more than 80% of the portfolio in equities, gained 5.9%.

We are thankful for the opportunity to support you in creating powerful, rewarding philanthropy to make Greater Seattle a stronger, more vibrant community for all. I welcome your questions and comments about Seattle Foundation’s investment performance and judicious stewardship of assets, a cornerstone of our partnership with you and our more than 70-year commitment to this community.

Sincerely,

Tony Mestres, President & CEO

See full report

Investment Performance by Pool