Over the past decade, foundations and endowments have repositioned their market exposures away from long-only U.S. equities, and moved into U.S., global and emerging markets fixed income, according to a new report form eVestment.
These investors have been searching for yield around the world as a way to rely more heavily on income-producing investments, the report said.
Although much of these reallocated assets have gone to U.S. fixed-income strategies, the reallocation process has resulted in large increases in exposure to the sovereign debts of a diverse group of countries.
Since 2011, foundations and endowments have allocated more to emerging markets fixed-income strategies than to any other strategy, according to eVestment.
eVestment based its report on information provided to its global database on more than $500 billion of foundation and endowment assets under management.
According to the report, foundations and endowments’ emerging markets fixed income exposure amounted to some $8 billion across 28 firms and 38 strategies. Five firms accounted for 70% of assets.