February 19, 2019
Mountain Sky United Methodist Foundation WebinarKristi Kinnison, Executive Director
Mountain Sky United Methodist [email protected] • 303-778-6370 direct
Karen Manczko, Director, Institutional RelationshipsWespath Institutional Investments
[email protected] 847-866-4236 direct • 773-981-2507 mobile
Presenter Biographies
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Karen Manczko, Director, Institutional Relationships, Wespath Institutional Investments
Karen joined Wespath in April 2013. Karen is primarily responsible for developing and managing relationshipswith institutional clients. Specifically, she helps guide clients with asset allocation analysis, investment policystatement development and in incorporating sustainable investing guidelines into an overall investmentprogram. Karen also frequently presents on investment-related topics at United Methodist-affiliatedconferences and events. She most recently served as an Associate Investment Program Manager forNorthern Trust Global Advisors, where she was responsible for developing, implementing, monitoring andevaluating custom investment programs for institutional and ultra-high net worth clients. Prior to that, shewas a Senior Investment Performance Analyst within Northern Trust’s Investment Risk and Analytical Servicesdepartment. She received a B.S. degree in Psychology from the University of Illinois at Urbana-Champaign.
Kristi Kinnison, Executive Director, Mountain Sky United Methodist Foundation
Kristi discovered her passion for church stewardship in 2007 when she was challenged with organizing the annual giving campaign at her church. Since then, she has grown deeply in the spiritual practice of faithful financial management, generosity, and holistic stewardship. She has spoken to thousands of United Methodists about faithful financial stewardship.
Kristi has been Executive Director of the Mountain Sky United Methodist Foundation since 2010. She has more than 30 years of business management experience in nonprofits, mortgage banking, and manufacturing. A life-long United Methodist, she and her 17-year-old daughter are members of Trinity United Methodist Church in downtown Denver. Calling Colorado home for most of her life, Kristi feels blessed to combine her education, business experience, and passion with her faith.
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About the Mountain Sky United Methodist Foundation
Our Mission is to help churches fund and support ministry and mission in this and subsequent generations.
• Financial and stewardship partner in ministry to the United Methodist organizations of the Mountain Sky Conference
• One of 43 U.S.-based UM foundations
• 32 years servicing Mountain Sky United Methodist organizations—incorporated in 1987
• 501 (c)(3) not-for-profit organization
• $40.3 million in assets under management as of December 31, 2018
As of December 31, 2018, unless otherwise stated.
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2018 Foundation Merger
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Fulfilling Our Mission Through the Services We Offer
Funding Scholarships for Future Leaders
(48 scholarships funded since 2009)
Promoting Planned Giving Programs
Providing Investment Solutions Aligned with the
Social Principles of the UMC
Giving Grants
To create systemic change that strengthens ministry
and finances
Conserving Assets
Providing investment solutions aligned with the
Social Principles of The United Methodist Church
Church Loans
Loans for capital needs
Building Endowments
Helping churches achieve financial stability with planned giving, trust management and
leadership training.
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Financial Ministry Grants
To help with debt relief and establish credit so that the church can eventually refinance some private debt
Deer Park United Methodist Church
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Financial Ministry Grants
To provide video recording and live streaming equipment
Peoples United Methodist Church
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Financial Ministry Grants
To help install the bricks for a new community garden
Green Mountain UMC
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Financial Ministry Grants
To help promote estate planning and create a “Tithe Your Will” campaign
Heart of Longmont
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Financial Ministry Grants
Seed money for a new ministry forming a spiritual community for addicts, loved ones of addicts, and spiritual refugees
FREEA ministry of St. Luke’s United Methodist Church
The capital for church loans comes from investments in the Methodists Helping Methodists Fund:
a great way to put your money where your faith is!
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Church Loans – We Speak Church!
• Construction• Renovations• Repairs• Refinancing• Other capital needs
What For?
• Originated $1.84 million
• Three churches• Renovations• Refinancing
2018
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Investment Solutions in Full Alignment with the Social Principles
The foundation and its investment managers are fiduciaries
Sustainable and socially responsible investing through social screens, proxy voting and advocacy
Fees from investments support the missional work of the Foundation
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Investment Opportunities
• Balanced Fund• 65% equities• 35% fixed
• Fixed Income• Equity Growth
Markets
• Short Term Cash• Methodists Helping
Methodists• Time-deposits• Demand
savings
Cash
(meets UPMIFA guidelines for endowment investing)
Markets Cash
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Investment Managers
Markets
• Wespath Institutional Investments
• DA Davidson Investments• ANB Bank (Sturm
Financial Group)
Cash
• ANB Bank• Texas Methodist
Foundation• Methodists Helping
Methodists Fund
Foundation Investment Performance Summary (as of January 31, 2019)
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Performance isnet-of-fees Portfolio Model 2019 YTD
Actual 2018 3-Year 5-Year 10-Year* Average Yield(Income)**
Balanced Fund 65% Equities35% Fixed Income 6.44% -5.79% 10.50% 5.49% 10.08% 1.88%
Fixed Income Fund80% Fixed Income
20% Inflation Protection
2.05% -1.76% 3.64% 1.99% 3.33% 3.33%
Equity Growth Fund 70% U.S.30% International 9.27% -8.86% 13.73% 7.56% 17.73% 1.18%
Socially Responsible Investment Summary Annualized
†On November 1 2010, the Foundation changed investment managers to Wespath. *The Balanced Fund was created by the foundation November 1, 2010. The five and ten year historical figures are provided as if the fund had been in place during this time. **Average Yield (Income) is based on three year average of interest and dividend earnings.
Short Term Cash Fund APYAPY Month 2018 2017 2016 2015 2014 2013
Variable Rate 0.60% 0.58% 1.41% 1.67% 1.84% 2.10% 2.10%
Methodists Helping Methodists Fund – Fixed Rate InvestmentsTerm (months)
Effective February 1, 2019 to March 31, 2019
12m 24m 36m 48m 60m
$1,000 to $4,999 1.41% 1.51% 1.76% 2.17% 2.43%
$5,000 to $9,999 1.92% 2.02% 2.27% 2.68% 2.94%
$10,000+ 2.02% 2.12% 2.38% 2.78% 3.04%Variable-Rate accounts starting at $500 pay 0.75%
Rates effective as of the date of this report and aresubject to change. Rates are Annual Percentage Yield (APY). Accounts are not FDIC insured nor areaccounts insured by any other governmental or private insurance of any kind. This is not an offer to sell or the solicitation of an offer to buy any investment or security. The offering is made only by the current Offering Circular which is available by contacting the Foundation.
Historical returns are not indicative of future performance.
Foundation Net-of-Fees Performance Summary (as of January 31, 2019)
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Annualized
(%) Month 1-Year 3-Year 5-Year 10-Year* 2018 2017 2016 2015 2014 2013 2012 2011
Balanced Fund 6.44 -3.30 10.50 5.49 10.08 -5.79 16.61 8.21 -3.31 3.42 15.50 12.17 1.14
Blended Benchmark** 5.97 -3.07 9.50 6.35 10.17 -5.62 16.63 8.84 -1.11 5.91 16.00 12.67 0.40
The Balanced Fund was established by the Foundation Nov, 2010.*Historical figures for 10-Year returns are provided by Wespath. This information is provided as if the fund had been in place during this time. ** The blended custom benchmark index is a blend of Barclays Capital US Govt. Inflation Linked Bond Index, Barclays Capital US Universal Index (excluding mortgage backed securities), Russell 3000 Index, and the Morgan Stanley all Country World Index (excluding USA).
(%) Month 1-Year 3-Year 5-Year 10-Year 2018 2017 2016 2015 2014 2013 2012 2011
Fixed Income Fund 2.05 0.25 3.64 1.99 3.33 -1.76 5.29 5.76 -3.28 3.33 -2.91 8.57 6.09
Blended Benchmark^ 1.66 1.65 3.30 2.90 4.66 -0.80 4.50 6.45 -0.45 5.26 -4.00 5.05 9.57
^This Blended Benchmark Index includes Barclays Capital U.S. Government Inflation-Linked Bond Index and Barclays Capital U.S. Universal Index (excluding mortgage-backed securities).
(%) Month 1-Year 3-Year 5-Year 10-Year* 2018 2017 2016 2015 2014 2013 2012 2011
Equity Growth Fund 9.27 -5.40 13.73 7.56 17.73 -8.86 21.59 9.13 -2.79 5.00 27.58 15.50 -5.71
Blended Benchmark^^ 8.28 -5.49 12.80 8.25 13.20 -8.10 23.13 10.24 -1.04 7.63 28.22 16.71 -3.28
^^Includes the Russell 3000 Index and the Morgan Stanley Capital All Country World Index - excluding USA.
(%) Month 2018 2017 2016 2015 2014 2013 2012 2011
APY % Variable Rate 0.6000 0.5806 1.4090 1.6789 1.8369 2.0999 2.0999 2.0999 1.9065Historical returns are not indicative of future performance.
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The Markets: What Happened in 2018? January 2019?
4th Quarter and 2018 Market Returns
Source: FactSet.
4th Qtr 2018 (%) 2018 YTD (%)
Bloomberg Barclays U.S. Treasury Index 2.6 0.9
Bloomberg Barclays Universal Index 1.2 -0.3
Bloomberg Barclays U.S. Inflation-Linked Index -0.5 -1.5
Bloomberg Barclays U.S. Corporate High-yield Index -4.5 -2.1
Bloomberg Barclays U.S. Credit Index 0.0 -2.1
Bloomberg Barclays Emerging Markets USD Aggregate Index -0.2 -2.5
S&P 500 Index -13.5 -4.4
Russell 1000 Index -13.8 -4.8
Russell 2000 Index -20.2 -11.0
Bloomberg Commodity Index -9.4 -11.3
MSCI EAFE Net Dividend Index -12.5 -13.8
MSCI ACWI ex-U.S. IMI Net Index -11.9 -14.8
MSCI Emerging Markets Investable Mkt Index -7.4 -15.1
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Frequently Cited Explanations for December Market Downturn
Hawkish Comments out of December Fed Meeting
Recession Fears/Inverted Yield Curve
Partial Government Shutdown
Decreasing Manufacturing Activity in Europe
Algorithmic Trading Strategies
Ongoing Impasse in China Trade Negotiations
Decelerating Corporate Profit Growth
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January 2019 Market Returns
Source: FactSet.
January 2019
Bloomberg Barclays U.S. Treasury Index 0.5
Bloomberg Barclays Universal Index 1.4
Bloomberg Barclays U.S. Inflation-Linked Index 1.4
Bloomberg Barclays U.S. Corporate High-yield Index 4.5
Bloomberg Barclays U.S. Credit Index 2.2
Bloomberg Barclays Emerging Markets USD Aggregate Index 3.2
S&P 500 Index 8.0
Russell 1000 Index 8.4
Russell 2000 Index 11.3
Bloomberg Commodity Index 5.5
MSCI EAFE Net Dividend Index 6.6
MSCI ACWI ex-U.S. IMI Net Index 7.6
MSCI Emerging Markets Investable Mkt Index 8.4
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3.7%
2.3%
4.6%
3.5%
2.0%
4.5%
3.6%
1.7%
4.9%
0%
1%
2%
3%
4%
5%
World Advanced Economies Developing Economies
2018 2019 2020
World Economic Growth Forecast 2018-2020
Source: International Monetary Fund World Economic Outlook. Data as of January 21, 2019.22
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About Wespath Institutional Investments
• A subsidiary of Wespath Benefits and Investments (Wespath). About Wespath:
• An agency of The United Methodist Church
• Founded in 1908
• Nearly $23 billion in assets under management
• More than 130 institutional clients
• Team of 20 dedicated investment professionals
As of January 31, 2019
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Wespath Team
Bill Stewart, CFADirector, Institutional Relationships
Karen ManczkoDirector, Institutional Relationships
Investment Analytics
Piotr ChwalaManager
Amy BulgerManager, Alternative Investments
Mark Warren, CFAManager, Public Equities
Rashed Khan, CFAManager
Anita GreenDirector
Nicholas AbelSpecialist
David ZellnerChief Investment Officer
Juan LoisManagerFrank Holsteen
DirectorBrian Boyer, CFADirector
Investment ServicesSustainable Investment Strategies
Constance Christian, CFAManager
Trent SparrowSenior Analyst
Hsiu-Feng HuangSenior Analyst
Sylvia PonieckiDirector
Krystal HolmesSenior Client Operations Specialist
Christina TincherManager, Marketing
Investment Management
Equities Fixed Income Positive Social Purpose Lending
Alicia MarriottClient Service Specialist
Susan Chung, CFAManaging Director
Wespath Benefits and Investments’ (Wespath) subsidiaries, including Wespath Institutional Investments, utilize certain shared personnel, including the tenured Wespath investment team presented above.
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Low–Carbon TransitionSustainabilityInvestor Focus Optimistic Worldview
Long–Term Perspective CultureDiversification Stewardship
Active ManagementExpertise
Investment Beliefs
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Fund Construction Utilizing World-Class Managers…
a
Sampling of managers as of December 31, 2018.
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…and Boutique Specialists
Sampling of managers as of December 31, 2018.
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Broad Global Diversification of Investment Funds – Target Allocations
Future asset allocations may be different than those stated above.
Wespath International Equity Fund – I Series
• Developed Core• Developed Growth• Emerging Market• Small-Cap Core• REITs• Private Equity• Private Real Estate
U.S. Equity Fund – I Series
Wespath: • Large-Cap Core (Passive)• Large-Cap Growth• Large-Cap Value• Mid-Cap Core• Mid-Cap Growth• Small-Cap Value• Small-Cap Growth• Private Equity• Private Real EstateDavidson:• Large-Cap Core • Mid-Cap Core
Wespath Fixed Income Fund –I Series
• Core Plus (Active)• Credit• Affordable Housing
Loans/ Agency CMBS• High-Yield• Global• Emerging Market
Wespath Inflation Protection Fund – I Series
• U.S. TIPS (Passive)• Global (Inflation-Linked)• Emerging Market
(Inflation -Linked )• Commodities• Senior Secured Loans
45%10%
20%
25%
Wespath Inflation Protection Fund – I Series: 10%
Wespath U.S. Equity Fund – I Series: 35%
Davidson Investments Multi-Cap Equity Fund: 10%
Wespath International EquityFund – I Series: 20%
Wespath Fixed Income Fund – I Series: 25%
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Mountain Sky United Methodist Foundation Balanced Fund Comparison (Net-of-Fees as of January 31, 2019)
Fund Performance Comparison
Annualized Performance (net-of-fees)
1-Year 3-Year 5-Year 10-Year
Balanced Fund -3.3% 10.5% 5.5% 10.1%
Lipper Median* -3.8% 7.4% 4.6% 9.0%
# of Observations 4,789 4,080 3,240 1,994
As of January 31, 2019. The historical returns presented herein represent the actual historical returns of the Balanced Fund, which reflect the deduction of fees charged by The Mountain Sky United Methodist Foundation.
*Median returns from the Lipper mutual fund universe for balanced funds in the asset class category.
Source: Wilshire Associates, Lipper, and Mountain Sky United Methodist Foundation.
The information in this document was obtained from sources believed to be reliable, however, accuracy is not guaranteed. Historical returns are not indicative of future performance.
1-Year 3-Year 5-Year 10-YearBalanced Fund -3.3% 10.5% 5.5% 10.1%Lipper Median* -3.8% 7.4% 4.6% 9.0%
-5%
-3%
-1%
1%
3%
5%
7%
9%
11%
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Aligning Fiduciary Duty with UMC Values
• Proxy voting• Shareholder
resolutions• Corporations• Policymakers
• Ethical exclusions• Financial risk
exclusions
• External manager ESG benchmarking
• Positive Social Purpose LendingProgram
• Low-carbon energy solutions
Avoid Engage Invest
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Performance Comparison: Wespath’s Screened Passive Portfolios vs. BenchmarksGross-of-Fees Return Data as of December 31, 2018
Note: This exhibit only includes Wespath's passively managed portfolios that have been in existence for at least ten years and that have been a part of the Wespath funds .
Historical returns are not indicative of future performance. Please refer to the Investment Funds Description at wespath.org for more information about the Fund. This is not an offer to purchase securities. See the Investment Funds Description for a description of the fees and expenses related to the funds managed by all external managers including those listed above. Wespath Institutional Investments and the I Series of funds were launched on January 2, 2019. The information does not represent investment manager performance within the I Series of funds.
*BlackRock's passive management of the Russell 3000 portfolio is based on a statistical sampling of stocks within the index. This strategy attempts to replicate the performance of the index by holding approximately three-fourths of its constituents.
Engage InvestAvoid
Name of External Manager Index Weight of Portfolio
Benchmark Eligible Stocks 1-Year 5-Years 10-Years Inception Date
Northern Trust Quantitative Advisors 97.7% -7.7% 6.0% 11.1% 12/1/1998
Russell 1000 Value Index 100.0% -8.3% 5.9% 11.2%
Difference -2.3% 0.6% 0.1% -0.1%
BlackRock, Inc.* 96.8% -12.1% 4.4% 11.8% 3/1/2001
Russell 2500 Value Index 100.0% -12.4% 4.2% 11.6%
Difference -3.2% 0.3% 0.2% 0.2%
BlackRock, Inc.* 96.4% -5.0% 7.7% 13.1% 6/1/1999
Russell 3000 Index 100.0% -5.2% 7.9% 13.2%
Difference -3.6% 0.2% -0.2% -0.1%
Annualized Returns
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Shareholder Engagement Success Stories
InvestEngageAvoid
Developed Supplier Code of Conduct Published a Sustainability Report
Committed to Source 100% Fair Trade Cocoa by 2020
Signed an agreement to make HIV medicine Atazanavir more accessible worldwide
Wespath Benefits and Investments implements the Sustainable Investment Strategies for investment funds made available through it and its subsidiaries, including Wespath Institutional Investments.
For more information: wespath.com/research_and_resources/press_releases/
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Positive Social Purpose (PSP) Lending Program
Avoid
More than 52,000 affordable housing
units financed
Providing access to needed multi-family affordable
housing
• More than 65,000 jobs• More than $1.9 billion
in tax revenue
Supporting jobs and local communities*
Invested more than$83 million in loans
to entrepreneurs
International microfinance—supporting entrepreneurs
in emerging markets
• Internally-managed investment strategy • More than $2 billion in PSP investments since 1990
Engage Invest
*Estimate based on data obtained from the National Association of Home Builders in 2016.
Wespath Benefits and Investments’ subsidiaries, including Wespath Institutional Investments manage funds that participate in the Positive Social Purpose Lending Program. The information provided represents the combined investments of all funds.
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Positive Social Purpose (PSP) Lending Program – Affordable Housing
Avoid Engage Invest
Garden Court at Yale StationDenver, Colorado
Loan: $3.2 millionUnits: 66
Affordable multifamily housing
• Amenities include community center, business center and community garden
• Walking distance to Denver’s Southeast Light Rail Line
• Located near Grace United Methodist Church
Image Source: Brad Bartholomew of Bartholomew Photography
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Positive Social Purpose (PSP) Lending Program – Affordable Housing
Avoid Engage Invest
Castle Bar II ApartmentsBozeman, Montana
Loan: $1.1 millionUnits: 36
Affordable multifamily housing
• Amenities include access to internet connected computers, in-unit washer/dryer hookups and a clubhouse with a meeting room
Image Source: Community Development Trust
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Our Missions are Aligned
• Enable UM entities to meet their investment objectives
• Support the continued mission of the UMC
• Fulfill ministry with a secure financial future
Working Together Since 2005
Added in January 2018
Relational LeadershipAligned with the goals of
The United Methodist Church
Supportive LeadershipCounseling and guidance
for a secure financial future
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The MSUMF and Wespath Institutional Investments Advantage
Professional LeadershipInvestment solutions to meet your investment
objectives
We provide the leadership and insight to help your program thrive into the future.
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Planned Giving and Endowment Building
Available to All Churches and Ministries:
• Postcards• Will-Power Program• Endowment Development Work• Planned Giving Resources• Free Trust Management
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Free Trust Management
Lawn Mower Trust
Benefits a church in Wyoming
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Appendix
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Investments Division – Biographies David Zellner, Chief Investment OfficerDave has been with Wespath since 1997 and is responsible for the entire Investments Division, comprised of InvestmentManagement, Investment Services and Sustainable Investment Strategies. Former employers include Shell Oil Company,where he managed equity portfolios for Shell’s retirement plans and Investment Research Company (an investmentmanagement firm) where he was a portfolio manager and responsible for managing the firm’s investment operations.As CIO, Dave is responsible for executing and administering Wespath’s investment program as directed by itsInvestment Strategy Statement and Statement of Administrative Investment Policy. Dave helped co-author and was oneof the original signatories to the United Nations Principles for Responsible Investment in 2006. Dave receiveda bachelor's degree in Finance from Louisiana State University and his MBA from the University of Houston.
Investment Management
Brian Boyer, CFA, Director, EquitiesBrian joined Wespath in September 2003. As the director of Equities in Investment Management, he is responsible foroverseeing the strategic direction and staff of the public equities and alternative investments programs, including theasset classes of private equity and private real estate. Previously, he spent 15 years with First Analysis Corporation, aChicago-based investment firm. At First Analysis, he was a senior vice president with responsibility for developing publicequity research coverage and making venture capital investments in various technology sectors includingtelecommunications products and services. Brian currently serves on the Northbrook United Methodist Churchendowment committee. He received a bachelor of arts degree and a bachelor's degree in engineering from DartmouthCollege, and an MBA from The Wharton School at the University of Pennsylvania. He is also a CFA Charterholder.
Susan Chung, CFA, Managing Director, Investment ManagementSusan joined Wespath in April 2018. As the Managing Director of Investment Management, Susan provides strategicinvestment support and risk management for Wespath’s investment program, as well as administrative and operationaloversight. She leads a team of investment professionals responsible for sourcing, monitoring and reporting on all ofWespath’s fixed income, equity, and alternative investments, and its internally managed Positive Social Purpose LendingProgram. Prior to this role, Susan was the Head of Global Strategy at Allstate Investments, where she was responsiblefor providing views on global macro-economic and geopolitical events. Her previous experience includes investmentconsulting with Ennis Knupp & Associates (now Aon Hewitt Investment Consulting), managing real estate and structureddebt with Bank of America, and equities analysis with Morningstar. Susan received a bachelor’s degree in Mathematicsand Economics from the University of Chicago. She received her MBA in Finance and Accounting from the BoothGraduate School of Business at the University of Chicago. Susan is a CFA Charterholder.
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Investments Division – Biographies
Sylvia Poniecki, Director, Positive Social Purpose Lending ProgramSylvia joined Wespath in September 2011, and is responsible for providing managerial oversight of all aspects ofWespath’s Positive Social Purpose Lending Program. Previously, she worked at the Illinois Housing DevelopmentAuthority in positions of increasing responsibility, most recently overseeing the state’s Low Income Housing TaxCredit and Illinois Affordable Housing Tax Credit programs. In addition, she has managed a wide range of complexhousing projects and programs including: TCAP, Section 1602, HOME Multifamily Rental Programs, IllinoisAffordable Housing Trust Fund, taxable first mortgage financing and tax exempt bond financing. Sylvia received abachelor's degree in Computing and Web Design from DePaul University.
Amy Bulger, Manager, Alternative InvestmentsAmy joined Wespath in March 2013. As manager of Alternative Investments in Investment Management, she isresponsible for monitoring and expanding alternative investments and supporting the administration of thealternative investment program. Previously, she was an investment analyst at the Illinois Municipal RetirementFund, where she covered private real estate and other sector portfolios. Prior to that, she worked as an analyst inthe CMBS market at LaSalle National Bank and GMAC Commercial Mortgage. Amy received a bachelor's degree inEconomics from Northern Illinois University and an MBA from DePaul University.
Investment Management
Frank Holsteen, Director, Fixed IncomeFrank joined Wespath in March 2012. As the director of Fixed Income in Investment Management, he isresponsible for overseeing the strategic direction and staff of the fixed income investment program. Previously,he was managing director at Barrington Strategic Wealth Management Group, where he contributed his fixedincome background to risk control and return enhancement strategies. Prior to that, he worked for 14 years as afixed income portfolio manager and trader at Chicago Asset Management Company. Frank received a bachelor'sdegree in Economics from Lake Forest College.
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Investments Division – Biographies
Investment Management
Piotr Chwala, Manager, Positive Social Purpose Lending ProgramPiotr joined Wespath in April 2014 and is responsible for executing and administering the organization’scommercial real estate portfolio, known as the Positive Social Purpose Lending Program. Prior to Wespath, Piotrwas an underwriter within Prudential’s FHA multifamily business, primarily focusing on affordable multifamilylending. During his more than seven years at Prudential, he held positions within portfolio management, specialservicing and underwriting. Piotr received a bachelor's degree in Finance and Real Estate from DePaulUniversity.
Rashed Khan, CFA, Manager, Investment AnalyticsRashed joined Wespath in November 2008. He is responsible for managing the analyst pool and overseeing thecross-platform investment analysis and reporting on all Wespath funds. Before joining Wespath, he worked as aloan officer for Cambridge Realty Capital, a Chicago-based senior housing and healthcare finance company, andserved as a loan administration officer at a certified community development financial institution. Rashedreceived a bachelor's degree with a concentration in Finance from Berea College. He is also a CFA Charterholder.
Constance Christian, CFA, Manager, Fixed IncomeConnie joined Wespath in May 2016. As manager, Fixed Income, she shares responsibility for the oversight offixed income assets within the Wespath funds. Previously, she was vice president and fixed income portfoliomanager at ABN AMRO Asset Management. Prior to that, she was partner and fixed income portfolio managerat Brinson Partners. Connie also taught college level pre-calculus for Chicago Public Schools. She received abachelor's degree in Finance and an MBA from Xavier University, and she received a master's degree fromDePaul University. She is also a CFA Charterholder.
Mark Warren, CFA, CIMA, Manager, Public EquitiesMark joined Wespath in August 2015 and is responsible for overseeing the public equity investment program.Previously, Mark held senior level positions with The Boeing Company where he was responsible for public andprivate equity investments within the pension group. Prior to joining Boeing, Mark was vice president withHighMark Capital Management where he evaluated investment allocations with outside money managers. Prior tothat, Mark worked at the Abu Dhabi Investment Authority (ADIA) as an assistant fund manager and at Deloitte &Touche Investment Advisors as a senior consultant. Mark received a bachelor's degree from Purdue University. Heis also a CFA Charterholder and a Certified Investment Management Analyst (CIMA).
Trent Sparrow, Senior Analyst, Positive Social Purpose Lending ProgramTrent joined Wespath in October 2012. As senior analyst of the Positive Social Purpose Lending Program, he isresponsible for the day-to-day reporting and analysis of several internally-managed portfolios of market-ratecommunity development loans, one of which is a component of Wespath’s Fixed Income Fund. Previously, he wasan analyst at Neighborhood Housing Services of Chicago (NHS), where he managed investor relations and portfolioreporting. Prior to NHS, Trent worked as a commercial real estate portfolio manager for Zions Bank. Trent receiveda bachelor's degree in Finance from Idaho State University.
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Investments Division – Biographies
Investment Management
Hsiu-Feng Huang, Senior Investment Analyst, Investment ManagementHsiu-Feng joined Wespath in January 2016. Her primary role is to analyze, monitor and evaluate investmentportfolios and manager performance. She most recently served as investment analyst for Plan Sponsor Advisors,where she was responsible for creating investment reports and monitoring portfolios for institutional clients. Priorto that, she was operations manager at IBT Securities Company. Hsiu-Feng earned a bachelor's degree with aconcentration in Insurance and Finance from Takming College in Taipei, Taiwan and an MBA from the University ofIllinois at Chicago.
Institutional Investment Services
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Investments Division – Biographies
Karen Manczko, Director, Institutional Relationships Karen joined Wespath in April 2013. Karen is primarily responsible for developing and managing relationships withinstitutional clients. Specifically, she helps guide clients with asset allocation analysis, investment policy statementdevelopment and in incorporating sustainable investing guidelines into an overall investment program. Karen alsofrequently presents on investment-related topics at United Methodist-affiliated conferences and events. She mostrecently served as an Associate Investment Program Manager for Northern Trust Global Advisors, where she wasresponsible for developing, implementing, monitoring and evaluating custom investment programs for institutionaland ultra-high net worth clients. Prior to that, she was a Senior Investment Performance Analyst within NorthernTrust’s Investment Risk and Analytical Services department. She received a B.S. degree in Psychology from theUniversity of Illinois at Urbana-Champaign.
Bill Stewart, CFA, CIMA, Director, Institutional RelationshipsBill joined Wespath in September 2016. As the director of Institutional Relationships, he is responsible formaintaining and growing relationships with institutional investors, including foundations, higher educationinstitutions, health care organizations, church agencies, and others. Bill was most recently a managing director atPNC Capital Advisors, where he served as the senior client portfolio manager for multiple equity investment teams.Prior to that, Bill served as the vice president and director of Investor Relations for Mercy Investment Services, Inc.,the socially responsible asset management program for the Sisters of Mercy and its ministries. Bill has also heldsenior leadership roles in institutional investments with Invesco, Ltd., National Asset Management, WachoviaSecurities, Inc., and EF Hutton. Bill received a bachelor’s degree in finance from Auburn University’s HarbertCollege of Business and a bachelor’s degree in psychology from Auburn University. Bill is a CFA Charterholder andhas earned the Certified Investment Management Analyst (CIMA) designation. Additionally, he is an Emeritusmember of the Dean's Advisory Council at The Raymond J. Harbert College of Business at Auburn University.
Institutional Investment Services
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Investments Division – Biographies
Christina Tincher, Manager, MarketingChristina joined Wespath in November 2016. As the marketing manager, she is responsible for developing marketingmaterials, including print and digital communications, to inform existing and prospective clients. She also leads thecampaign to raise awareness on social media about Wespath’s value proposition. Previously, Christina was anassistant vice president of client service at Brookfield Investment Management, where she worked closely with theinstitutional investor relations team to develop institutional investor marketing materials. Prior to that, Christina wasemployed as the marketing manager at Aurora Investment Management LLC. Christina received a bachelor's degreein Finance and Marketing from Marquette University.
Krystal Holmes, Senior Client Operations SpecialistKrystal joined Wespath in April 2014. As senior client operations specialist, she is responsible for deliveringoperational support to institutional clients, and for enhancing internal processes and systems designed to supportclient needs. Prior to this role, Krystal served as a plan sponsor manager within Wespath’s Customer Service division,where she was responsible for providing operational support to a variety of clients, including United Methodistannual conferences and general agencies. She received a bachelor's degree in Leadership Studies from DePaulUniversity and has successfully completed the Principles for Responsible Investment (PRI) Academy’s ResponsibleInvestment Essentials course.
Alicia Marriott, Client Service Specialist, Institutional Investment ServicesAlicia joined the Wespath Investments team in June 2018. As the client service specialist, she is responsible forsupporting the communications and operational efforts of our Institutional Investment Services team. She mostrecently worked with Wespath’s Meeting and Events team, planning and coordinating educational eventopportunities for participants and institutional investors. Prior to her roles with Wespath, she worked as the globalaccounts director at SBC Communications (Cingular Wireless), where she was responsible for building new clientrelationships and servicing existing accounts. Alicia received a bachelor's degree in Business Communications fromthe University of Kansas.
Sustainable Investment Strategies
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Investments Division – Biographies
Anita Green, Director, Sustainable Investment StrategiesAnita joined Wespath in December 2008. As the director, Sustainable Investment Strategies, she is responsible forstrategic development and implementation of Wespath’s corporate engagement program. In this role sheregularly communicates with corporate management about policies and practices related to environment, socialand governance issues. Previously, Anita worked for 16 years at a retail mutual fund company, where she was thevice president of Social Research. In this capacity she managed the social research, proxy voting and shareholderadvocacy programs. Anita received the "SRI Service Award" in 2004 and the "Making a Difference" award in 2000.Anita currently serves on the board of directors for the Interfaith Center on Corporate Responsibility (ICCR). From1999-2005, she served on the board of directors of the US SIF: the Forum for Sustainable and ResponsibleInvestment. Anita received a bachelor's degree in Communications from Truman State University, amaster's degree in Organizational Management from the University of Phoenix, and has completed theResponsible Investment Academy "Enhanced Financial Analysis" course and the "Climate Change: Risks andOpportunities for the Finance Sector" course offered by the UNEP Finance Initiative.
Nicholas Abel, Sustainable Investment Specialist, Sustainable Investment StrategiesNick joined Wespath in October 2016. As a sustainable investment specialist, Nick works to integrateenvironmental, social and governance (ESG) factors into Wespath’s investment process. Nick also leads ourcorporate governance engagement activities. Previously, he was a senior investment analyst at RVK, Inc., where heperformed ESG-product portfolio analysis, capital market research and investment due diligence for institutionalinvestors. Nick received his bachelor's degree in Finance from Western Washington University.
Juan Lois, Manager, Sustainable Investment StrategiesJuan joined Wespath in September 2015. As the manager, Sustainable Investment Strategies, he ensures thatWespath’s investment program incorporates environmental, social and governance (ESG) metrics into theinvestment process. He is also responsible for overseeing Wespath’s ethical exclusions and contributes to theteam’s corporate engagement and proxy voting activities. Prior to joining Wespath, Juan worked in institutionalsales and business development at Cornerstone Capital Group, a financial services firm dedicated tomainstreaming the discipline of sustainable finance. Before that, he worked in the energy industry in LatinAmerica, focusing on mining, electricity generation and renewable energy technologies. Juan received hisbachelor's degree in Latin American Studies from Tufts University, and his master's degree in InternationalRelations from The George Washington University.
Investment Partnership Supports Continued Mission of the Church
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Bill Stewart, CIMA, CFA, Director, Institutional Relationships, Wespath Institutional InvestmentsLocal Foundation
Wespath Investment
Management
Local Foundation Provides Services
• Local contact for the institution
• Educational and financial resources including:
• Investment strategy development
• Planned giving seminars
• Stewardship workshops
• Provides grants for retired clergy
• Provides scholarships
Churches and Other United Methodist -Affiliated
Institutions
• Provides diversified investment management services
• Invested according to the Social Principles
• Partners with the foundation on:
• Client servicing• Development of
Investment Policy Statements
• Investor communications
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U.S. Equity Fund Allocations (as of December 31, 2018)
Future asset allocations may be different than those stated above. Wespath Institutional Investments and the I Series of funds were launched on January 2, 2019. The allocation information presented above does not represent information for the I Series of funds.
Benchmark: Russell 3000 Index
Holdings-Based Allocation Fund Allocation
Benchmark Allocation Difference
Large-cap stocks 44% 68% -24%
Small- and mid-cap stocks 47% 32% +15%
Private equity and private real estate 7% 0% +7%
Cash (equitized) and unassigned 2% 0% +2%
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International Equity Fund Allocations (as of December 31, 2018)
Future asset allocations may be different than those stated above. Wespath Institutional Investments and the I Series of funds were launched on January 2, 2019. The allocation information presented above does not represent information for the I Series of funds.
1. Real Estate Investment Trusts (REITS) includes REITs, as well as real estate management and development companies.
Benchmark: MSCI All Country World (ex-US) Investable Market Index (Net)
Holdings-Based Allocation Fund Allocation
Benchmark Allocation Difference
Developed markets (excluding REITs) 55% 71% -16%
Emerging markets 30% 25% +5%
REITs1 6% 4% +2%
Private equity and private real estate 7% 0% +7%
Cash (equitized) 2% 0% +2%
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Fixed Income Fund Allocations (as of December 31, 2018)
Benchmark: Bloomberg Barclays U.S. Universal Index (ex-MBS)
Future asset allocations may be different than those stated above. Wespath Institutional Investments and the I Series of funds were launched on January 2, 2019. The allocation information presented above does not represent information for the I Series of funds.
*9% of the fund’s assets are allocated to non-U.S. dollar denominated debt which is included in the “Non-U.S. developed markets debt” and “Emerging markets debt” allocations in the table above. The benchmark does not allocate to non-U.S. dollar denominated debt.
Holdings-Based Allocation Fund Allocation
Benchmark Allocation Difference
U.S. Treasury and government bonds 16% 61% -45%
U.S. corporate investment grade 24% 23% +1%
U.S. corporate high-yield 12% 5% +7%
Non-U.S. developed market debt* 15% 7% +8%
Emerging market debt* 9% 3% +6%
Allocation to market-rate community development loans (affordable housing) 6% 0% +6%
Other (ABS, CMBS, MBS, cash and alternatives) 18% 1% +17%
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Inflation Protection Fund Allocations (as of December 31, 2018)
Benchmark: IPF Custom Benchmark1
Future asset allocations may be different than those stated above. Wespath Institutional Investments and the I Series of funds were launched on January 2, 2019. The allocation information presented above does not represent information for the I Series of funds.1. The IPF Custom Benchmark is a blend comprised of 80% Bloomberg Barclays World Government Inflation Linked Bond Index (Hedged), 10% Bloomberg Barclays Emerging Market Tradeable Inflation Linked Bond Index (Unhedged) and 10% Bloomberg Commodity Index.
Holdings-Based Allocation Fund Allocation
Benchmark Allocation Difference
Treasury Inflation-Protected Securities (TIPS) 53% 44% +9%
Global inflation-linked bonds (developed) 13% 36% -23%
Floating rate senior secured loans 10% 0% +10%
Commodities 9% 10% -1%
Emerging market inflation-linked bonds 9% 10% -1%
Real assets and alternative investments 5% 0% +5%
Cash 1% 0% +1%
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DisclosuresGeneral Board of Pension and Health Benefits of The United Methodist Church, Incorporated in Illinois ("Wespath Benefits and Investments" or "Wespath") is a not-for-profit, administrative agency of the religious denomination known as The United Methodist Church.
Wespath is responsible for the general supervision and administration of retirement, disability, death and health benefit plans, and programs and for investment of the related assets and also provides certain investment services to institutional investors organized for religious, benevolent, or charitable purposes that are related to The United Methodist Church (sometimes referred to as the “Church”) as authorized by General Conference, the highest legislative authority of the Church. All funds under Wespath’s supervision are held in the Wespath Funds Trust, a Delaware statutory trust. Each of the funds available to investors is a series of the Wespath Funds Trust. The P Series funds are for investment of Church benefit plan related assets and the I Series funds are for investment of other assets of not-for-profit entities related to the Church such as foundations, children’s homes, older adult facilities, higher education institutions and healthcare organizations. UMC Benefit Board, Inc. (Benefit Board), a not-for-profit subsidiary of Wespath, is the trustee and investment adviser for the P Series funds. Wespath Institutional Investments (WII), a not-for-profit subsidiary of Wespath, is the trustee and investment adviser for the I Series funds.
Wespath, WII and Benefit Board are not registered investment advisers under the Investment Advisers Act of 1940, as amended, or under any comparable local, state or federal law or statute. Neither the Wespath Funds Trust nor the funds are registered as an investment company under the Investment Company Act of 1940 in reliance upon exclusions from the definition of an investment company under the Investment Company 1940 of Act. Wespath, WII, Benefit Board, Wespath Funds Trust and the funds are not subject to registration, regulation or reporting under the Investment Company Act of 1940, the Securities Act of 1933, the Securities Exchange Act of 1934 or the Investment Advisers Act of 1940. Investors, therefore, will not be afforded the protections of those provisions of those laws and related regulations.
The investment funds referred to in this document are neither insured nor guaranteed by the government. No government entity has approved or disapproved these funds or passed upon the adequacy of this document.
This presentation is for informational purposes only, it does not constitute an offer to sell any investments, and may be subject to changes and corrections. The material in this document contains summary information and is not a complete description of the investment guidelines, investment objectives, policies and risks or other matters associated with the investment funds. An offer for the sale of interests in the funds will only be made through the Investment Funds Description. Any decision to invest with Wespath should be preceded by a complete review of the Investment Funds Description and Investment Policy Statement for the P Series funds and the Investment Funds Description – I Series and Investment Policy - I Series funds, which are available upon request or online at wespath.org.
Historical returns are not indicative of future performance. Except as otherwise noted, the performance in this presentation is presented net-of-fees—that is, with the deduction of investment management fees, custody fees, and administrative and overhead expenses. Our fees and expenses are described in the Investment Funds Description for the P Series funds and the Investment Funds Description – I Series. The returns will be reduced by the amount of fees and expenses charged to the funds.
As part of the Wespath organization, WII and Benefit Board utilize certain shared personnel, including the tenured WBI investment team. All WII shared personnel must comply in all respects with WII’s policies and procedures.
Benchmarks and Universes: Throughout this document, the terms “benchmark” and “universe” are used to refer to comparisons of each fund’s performance. A benchmark is a standard that investors use to evaluate how well a fund has performed. Comparing a fund to this fixed standard allows investors to evaluate how well the fund did in terms of meeting its goals, whether the goal was to match returns of the benchmark or to attain a return above the benchmark. A universe is a group of comparable funds that have a similar investment strategy and similar benchmarks to the subject fund. A universe comparison is useful because it allows the investor to compare the performance of the subject fund to funds offered by other providers. Wilshire Associates, a data provider for the Benefit Board, provides universe data from the Lipper Inflation Protection Funds Universe (composed of a group of comparable mutual funds to IPF). BNY Mellon, a data provider for the Benefit Board, provides universe data from the BNY Mellon U.S. Master Trust Universe, which consists of corporate, foundation, endowment, public, Taft-Hartley and health care plans. The investment fund performance benchmarks have varied over the years. The return of the performance benchmark represents the linked returns of the benchmark(s) in place at the time of the fund’s performance. The universes have also varied over the years, but the rankings noted are based on universes provided by the vendors at the time of the report. The fund performance information for the BNY Mellon Master Trust Universe is provided gross-of-fees because the fees of the institutional investors that comprise the Universe varies.
