Philosophy Grounded in Academic Research

ICG’s investment philosophy is grounded in the academically-validated principle that asset allocation rather than security selection or market timing is the basis for successful investment management and the primary driver of long-term investment returns. Asset allocation is most successful if implemented in two steps: STEP ONE 1. Step one involves building a “core portfolio” comprised of the traditional asset classes of domestic and international equities and domestic fixed income securities. The “core portfolio” must be well diversified “among and within” asset classes and must maintain an “equity bias” and a “value tilt”.  Although both passive and active management strategies may be employed, ICG believes that the “core portfolio” should be primarily “anchored” in carefully structured “true asset class” investments. We would be pleased to share with you our view of the strategic role of each individual asset class that would be included in your “core portfolio”. STEP TWO 2. Step two in the asset allocation process involves identifying investment strategies that may be significant sources of “alpha” and allocating a portion of endowment/foundation funds to them. These allocations may include commitments to active managers of traditional assets who have demonstrated a consistent ability to add alpha through security selection as well as commitments to managers of alternative assets (e.g., real estate) and managers employing non-traditional strategies (e.g., absolute return strategies). The result of this second step in the asset allocation process is an “Alternatives and High Expected Alpha” portfolio that complements the “core portfolio” and potentially enhances overall endowment/foundation returns. “Over the past several years, the theory and practice of investment management have advanced significantly. Astute money managers have learned how to successfully apply the tools of modern portfolio theory in a variety of market settings and have realized that at its core, portfolio management is about identifying, measuring, and managing risks and costs in the pursuit of targeted returns. ICG would welcome the opportunity to visit with you about our philosophy and services.” Craig Rogers ICG believes that manager fees, trading commissions and other endowment/foundation-related expenses significantly impact portfolio performance and must be vigorously negotiated and carefully monitored. We will assist you in the negotiation process and monitor all portfolio costs and expenses on an ongoing basis. In sum, through particular attention to asset class and investment manager allocations and to cost and expense management, ICG assists each institution and its trustees in achieving portfolio objectives and in fulfilling the institutional mission.