PRINCO sets the investment allocation formula for charitable trusts, and selects and evaluates external specialists to handle day-to-day investment decisions.
The asset allocation for the trust accounts is currently 85% equity (stocks and real estate) and 15% fixed income (bonds), with the goal of long-term growth of principal. Of course, investment performance is not guaranteed. Trust values may decline, resulting in lower payments for unitrust beneficiaries. However, in 2007 Princeton's trusts achieved a total return of 8.6%. Over the last ten years (to December 2007) Princeton's trusts have achieved an average growth rate of 9.6%.
Equity Strategy
PRINCO has selected Grantham, Mayo van Otterloo (GMO) a highly respected investment management firm based in Boston, to manage the equity portion of the charitable trust assets. (GMO also manages a portion of the Princeton University endowment.) GMO actively manages trust assets within the asset allocation formula developed by PRINCO.
Fixed Income Strategy
PRINCO has selected Aberdeen Asset Management to manage the fixed income portion of all trust and pooled fund portfolios through its Core Fixed Income Strategy. The objective of this strategy is to maximize portfolio yield and total return relative to its benchmark (the Lehman Aggregate Bond Index).
George R. Webster ’36 established a charitable trust with just under
half-a-million dollars in October 1993, with an additional gift of just
over half-a-million dollars in 1994. When Webster died in January 2002,
the trust had reached almost $1.5 million. Through his gifts, the
George Webster Class of 1936 Endowed Fund for the Department of
Chemical Engineering will provide support for teaching and learning in
perpetuity.
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