Letitia Johnson, CIO of Amherst College, discusses how the endowment benchmarks its concentrated, low-turnover portfolio against traditional asset allocation frameworks.
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“For us, our benchmarks are much longer term than that, and they're the 7030 and the peer median.”
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More from Letitia Johnson
AssertionNot checkable as stated
Amherst concentrates 50% of its assets in top 10 managers
“So we have less than 40 managers in the portfolio. Half of our assets are in our top 10 managers.”
Letitia JohnsonApr 29, 2024▶ 25:20Letitia Johnson - Concentrated and Long-Term at Amherst College (EP.382)
Disclosure
Amherst omits real estate, private credit, and emerging markets managers
“We have some very meaningful holes in the portfolio when you look at us compared to peers, one of which is real estate. We have very little private credit to speak of. We don't have any global emerging markets managers. There are all sorts of things that we do…”
Letitia JohnsonApr 29, 2024▶ 26:24Letitia Johnson - Concentrated and Long-Term at Amherst College (EP.382)
Insight
Johnson: Manager Selection Matters as Much as Asset Allocation
“There's a real difference that comes in in the manager selection piece. And I think one of the things that I started to realize over time is that the manager selection piece is as important and as impactful”
Letitia JohnsonApr 29, 2024▶ 16:31Letitia Johnson - Concentrated and Long-Term at Amherst College (EP.382)
Insight
Letitia Johnson: Rigid asset class delineations fail to reflect manager opportunities
“These delineations and asset classes don't actually reflect the manager opportunity set.”
Letitia JohnsonApr 29, 2024▶ 19:39Letitia Johnson - Concentrated and Long-Term at Amherst College (EP.382)
Insight
Johnson: Uncalled commitments cause institutional crises, not private marks
“I have no control over private marks. The one thing that I do have control over is my commitment. Amounts. And oh, by the way, that's what gets me into trouble in times of crisis. The private NAV doesn't get me into trouble in times of crisis. It doesn't matte…”
Letitia JohnsonApr 29, 2024▶ 31:50Letitia Johnson - Concentrated and Long-Term at Amherst College (EP.382)
Insight
Johnson: Beta is completely useless for private asset portfolios
“Like this notion of beta basically becomes completely useless when you have privates. It's not helpful.”
Letitia JohnsonApr 29, 2024▶ 34:42Letitia Johnson - Concentrated and Long-Term at Amherst College (EP.382)
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