Annual report : 2000 / Burroughs Wellcome Fund.

  • Burroughs Wellcome Fund
Date:
2000
Catalogue details

Licence: Attribution 4.0 International (CC BY 4.0)

Credit: Annual report : 2000 / Burroughs Wellcome Fund. Source: Wellcome Collection.

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    REPORT ON FINANCE The Burroughs Wellcome Fund’s investments totaled $763.7 million at August 31, 2000, the end of our fiscal year. BWF’s primary financial goal is to pursue an investment strategy that will support annual spending needs and maintain a constant real level of assets over the long term. To achieve this goal, substantially all of our investments are placed in U.S. and international capital markets. Hence, fluctuations in BWF’s investment results will be due largely to variability in capital market returns. BWF’s investment policies are developed with the recom- mendations and review of the Investment Committee, which is appointed by and reports to BWF’s Board of Directors. The committee, which meets three times a year, has six voting members, including four representatives from outside BWF and two representatives from our board. The board’s chair, BWF'’s president, and BWF’s vice president for finance also serve on the committee as nonvoting members. As part of BWF’s investment strategy, we have established “allocation targets”—that is, percentages of our total assets to be invested in particular asset classes. Investment managers hired by BWF pursue more focused mandates within each sector. As of the end of the fiscal year, BWF’s asset mix and market values were: ° US. large capitalization equity assets had a market value of $235.7 million. The sector’s target allocation was 31 percent, and actual holdings stood at 30.9 percent. ¢ U.S. small capitalization equity assets had a market value of $116.7 million. The sector’s target allocation was 14 percent, and actual holdings stood at 15.3 percent. ¢ International equity assets had a market value of $219.1 million. The sector’s target allocation was 30 percent, and actual holdings stood at 28.7 percent. ¢ US. fixed income assets had a market value of $168.3 million. The sector’s target allocation was 22 percent, and actual holdings stood at 22 percent. * Cash equivalent assets had a market value of $11.8 million. The sector’s target allocation was 3 percent, and actual holdings stood at 1.5 percent. ° Alternative assets had a market value of $12.1 million. The sector did not have a target allocation, and actual holdings stood at 1.6 percent. The total market value of BWF’s investments increased by $94.1 million, or 14.1 percent, from the end of the previous fiscal year. This large increase in assets was due primarily to strong returns in worldwide equity markets over the course of the fiscal year. BWF’s total investment return for the fiscal year was 21.1 percent. The two sectors that drove this result were the U.S. small capitalization equity sector, which posted a 56.6 percent return, and the international equity sector, which posted a 24.8 percent return for the fiscal year. As of August 31, 2000, BWF employed 10 investment managers. In the U.S. large capitalization equity sector, the managers were Independence Investment Associates; Westpeak Investment Advisors; and Cohen, Klingenstein and Marks. Kennedy Capital Management and Scudder Kemper Investments managed U.S. small capitalization equities. Pacific Investment Management Company and Smith Breeden Associates were the bond managers. Capital Guardian Trust Company and Hansberger Global Investors managed inter- national equities. State Street Global Advisors managed a hedge fund. BWF also held investments in five venture capital funds: Intersouth Partners IV and V, the Spray Venture Fund, Mission Ventures II, and the North Carolina Bioscience Investment Fund.