Page 38 - July JSF report

INVESTMENT COMMITTEE MEETING MINUTES (DRAFT)
JOHNSON SCHOLARSHIP FOUNDATION MINUTES FROM INVESTMENT COMMITTEE MEETING
Draft June 14, 2023
June 5, 2023 – 8:50AM EDT – at Prime Boston location
(the meeting started 50 minutes late due to an elevator breakdown in Prime office building)
Attendees:
Committee Members: Dick Krause, Hugh Brown, Bobby Krause, Mike Miller and Malcolm Macleod who participated via Zoom
Prime Buchholz (Prime) Consultants: Rick Morrison, Ian MacPherson, Stephen Roche Dick chaired the Meeting.
1. Approval of Investment Committee Meeting Minutes – The minutes from the February 16, 2023 meeting were approved. Malcolm noted in the Private Capital commentary on page 6 that the weighting for the two Private Capital sectors discussed – venture capital and buyouts – only added to 75%. Hugh explained the other two small Private Capital allocations – real assets and distressed/opportunistic – which together account for about 25% of the total, were not mentioned since no change is anticipated in their weightings. On a related topic Prime indicated they may change the way Private Capital investments are categorized.
2. Investment Performance in the 2023 First Quarter – The turnaround in investment performance noted in the 2022 fourth quarter continued into the 2023 first quarter with JSF achieving investment returns of 4.5% (4th Q restated to reflect write downs in the Private Capital space) and 3.7% (in the 1st Q) respectively. JSF assets increased by $7.6 mill to $247.3 mill in the first quarter. As indicated in Table 1 JSF’s underperformed on a relative basis in the 2023 first quarter. On a one-year basis JSF’s percentile ranking versus its peer group fell into the bottom quartile (at 77). However, over longer periods JSF’s ranking is still first or second quartile – a ranking Prime and the Committee expects to be maintained. JSF’s significant overweight in the Private Capital space (especially for Venture) and underweight in Fixed Income/Cash, which boasted returns during the 2020 to 2022 period is now acting as a drag (see Table 2). This drag may continue to be the case over the next several quarters however over the long term Prime and the Committee believe Private Capital will produce above average returns. Additional comments on Private Capital follows.
Page 36 July Report
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