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CU Foundation Implements Portfolio Management Changes

University of Colorado FoundationThe University of Colorado Foundation has made a structural change in the management of its investment portfolio, including the University of Colorado endowment. The move is expected to save money, increase management resources, and maintain continuity with an investment-management team that has significantly outperformed the broad equity markets and peers over the past five years.

The foundation has entered an arrangement with asset management firm Perella Weinberg Partners (PWP) to manage its portfolio.

Chris Bittman, the foundation's chief investment officer since 2004, will continue to manage the portfolio. But Bittman and his staff will leave the foundation and manage it under the auspices of PWP, where Bittman will take on a role as partner and chief investment officer.

A 1985 CU-Boulder alumnus, Bittman will remain available to CU and foundation donors, faculty and development officers for presentations and consultations on investment strategy and performance. He and his staff will continue to work adjacent to the foundation's 1800 Grant St. offices.

Other key aspects of the CU endowment's management remain unchanged. Its asset allocation benchmarks will continue to be set by the foundation's investment policy committee, and its portfolio strategy and legacy holdings will largely remain the same. The Foundation's Board of Directors will maintain fiduciary responsibility for the endowment, with foundation Chief Financial Officer Rick Lawrence responsible for day-to-day interface with PWP.

Under Bittman's leadership, the foundation's investment track record has been exceptionally strong. Its portfolio is up 28 percent since Sept. 30, 2004, during which time the S&P 500 has been down 11 percent.

As the investment landscape grew increasingly complex, a need was seen for a sustainable investment model that would enable the foundation to enhance due diligence and monitoring efforts (in an era in which investments have become increasingly complex), while keeping costs from increasing.

Foundation management and board members have reviewed various approaches to portfolio management over the past three years, and have reviewed pricing and services of peer models before deciding to negotiate the new arrangement.

The new partnership offers an optimal mix of increased due diligence capabilities with the aid of PWP's much larger staff managing the CU Endowment. It also offers a cost structure below what the foundation would pay for in-house management services going forward, a structure that accommodates the foundation board of directors' fiduciary duty, and the continuation of investment leadership by Bittman.

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