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Fund Overview: Objective, Strategy and Holdings

  • Earn long-term capital appreciation from a broadly diversified portfolio of primarily U.S. stocks.
  • Holds securities of publicly-traded U.S. based real estate investment trusts (REITs), limited partnership interests in private U.S. real estate and other private investments (venture capital, buyouts, etc.) of U.S. companies.
  • Holds equity index futures of U.S. stock indexes.
  • The Fund generally does not invest in companies that derive more than 10% of their revenue from gambling or from the manufacture, sale or distribution of alcoholic beverages, tobacco-related products, adult entertainment, weapons, or the management or operation of prison facilities.

Fund Managers

The following individuals are responsible for the selection and monitoring of external asset managers:

Frank Holsteen Image

Frank Holsteen

Managing Director, Investment Management

  • With Wespath since 2012
  • B.A. from Lake Forest College
Amy Bulger Image

Amy Bulger

Director, Private Markets

  • With Wespath since 2013
  • B.S. from Northern Illinois University
  • MBA from the Kellstadt Graduate School of Business at DePaul University
Mark Warren Image

Mark Warren, CFA, CIMA

Manager, Public Equities

  • With Wespath since 2015
  • B.S. from Purdue University
  • CFA Charterholder
  • CIMA Certification

Management

The U.S. Equity Fund (USEF) invests with investment managers that specialize in broadly diversified strategies. USEF also invests with more than a dozen general partners through its real estate and private equity investments. Over 30% of the Fund is invested in passive strategies while the remainder is actively managed. These managers rely on professional judgment that involves the use of fundamental analysis to select securities. They seek to invest in attractively valued companies that represent above-average long-term investment opportunities. Each active manager has an objective to outperform specific performance benchmarks related to their investment style.

External Asset Managers

* Signatory to the United Nations Principles for Responsible Investment

 

Please refer to the Investment Funds Description – P Series for a detailed description of the investment strategies used in managing the Fund.

Performance, net of fees (as of 09/30/2021)

  3 mo YTD 1 yr 3 yr 5 yr 10 yr
U.S. Equity Fund -0.22% 12.58% 33.56% 15.83% 16.67% 16.04%
USEF Benchmark -0.10% 14.99% 31.88% 16.00% 16.85% 16.60%

Universe Comparison

U.S. Equity Fund vs. Peer Group Universe

Peer Group Performance Comparison

Peer group performance comparison

Annualized Performance (Gross-of-Fees)

  1 Year 3 Year 5 Year 10 Year
U.S. Equity Fund 45.23% 18.25% 17.98% 14.10%
Median 41.17% 16.14% 16.11% 12.97%
Rank in Universe 23rd 26th 18th 27th
# of Observations 645 583 510 348

Peer Group Performance Comparison and Annualized Performance (Net-of-Fees) data as of June 30, 2021.

Source: Lipper. Lipper Multi-Cap core Universe is a group of mutual funds comparable to USEF. This Universe consists of a Lipper predefined Universe of "Multi-Cap Core funds".

See Risk and Disclosures for more information regarding Net of Fees Performance.


USEF Benchmark

The U.S. Equity Fund performance benchmark is the Russell 3000 Index. The index measures the investment performance of the 3,000 largest (based on total market value) U.S. companies, representing approximately 98% of the publicly traded companies available for investment in the U.S. equity market.


Wespath Benefits and Investments (“Wespath”) is a general agency of The United Methodist Church, a 501(c)(3) tax-exempt organization. Wespath administers benefit plans and together with its subsidiaries, UMC Benefit Board, Inc. (“UMCBB”) and Wespath Institutional Investments, LLC (“WII”) invests (or provides back-office services for) assets on behalf of benefit plan participants and beneficiaries, plan sponsors and other institutions controlled by, affiliated with or related to The United Methodist Church (the “Church”). For GIPS compliance purposes, the Firm referenced herein is defined to include Wespath, UMCBB and WII (“Firm”).

Wespath claims compliance with the Global Investment Performance Standards (GIPS®). GIPS is a registered trademark of CFA Institute. CFA Institute does not endorse or promote this organization, nor does it warrant the accuracy or quality of the content contained herein. To obtain a copy of Wespath’s GIPS Report, please call us at 1-847-866-4100 or e-mail us at [email protected].

Allocations

Holdings-Based Style Allocations as of September 30, 2021

Style USEF Actual (%) USEF Benchmark (%) Difference (%)
U.S. Equity Securities 100.0% 100.0% -0.0%
   Large Cap 48.2% 68.5% -20.3%
      Large Cap Core 11.0% 17.6%  
      Large Cap Growth 18.2% 29.6%  
      Large Cap Value 19.0% 21.3%  
   Mid Cap 33.5% 24.9% +8.6%
      Mid Cap Core 9.7% 8.5%  
      Mid Cap Growth 6.4% 5.0%  
      Mid Cap Value 17.4% 11.4%  
   Small Cap 10.9% 6.6% +4.3%
      Small Cap Core 3.1% 1.9%  
      Small Cap Growth 5.1% 2.4%  
      Small Cap Value 2.7% 2.3%  
Alternatives 7.4% 0.0% +7.4%
   Private Equity 4.7% 0.0%  
   Private Real Estate 2.7% 0.0%  
Cash 0.0% 0.0% 0.0%

 

Characteristics

Fund Statistics as of June 30, 2021

  USEF1 USEF Benchmark3
Wgt. Mkt. Cap ($MM) $246,984 $449,040
Price/Earnings 47.9 22.0
Price to Book 3.6 4.4
Dividend Yield2 1.1% 1.2%
# of Stocks 2,534 3,009

1 Reflects the portion of the fund portfolio that is invested in public equities and REITs.

2 Does not reflect the deduction of fees.

3 The Russell 3000 was reconstituated in July 2019.


Risk Characteristics as of June 30, 2021

Statistics (trailing 5 years) USEF USEF Benchmark
Beta 1.02 1.00
R-Squared 0.97 1.00


Top 10 Stock Holdings as of June 30, 2021

Company Fund % % of USEF Benchmark
Microsoft Corporation 2.0% 4.6%
Apple Inc. 1.9% 4.8%
Amazon.com, Inc. 1.6% 3.4%
Alphabet Inc. 1.4% 3.3%
Tesla, Inc. 1.0% 1.2%
Berkshire Hathaway Inc. 0.9% 1.2%
NVIDIA Corporation 0.8% 1.1%
Wells Fargo & Company 0.7% 0.4%
Facebook, Inc. 0.7% 1.9%
JPMorgan Chase & Co. 0.7% 1.1%

 


Sector Weightings as of June 30, 2021*

USEL Sector weightings image

* Sector weights include Private Equity and Private Real Estate categorized as Alternatives. Cash is equitized. Other includes U.S. index futures.

Risks & Disclosures

All investments carry some degree of risk that will affect the value of the Fund’s holdings, its investment performance and the price of its units. As a result, loss of money is a risk of investing in the fund. USEF is subject to the following principal investment risks: market risk, investment style risk, security-specific risk, country risk, currency risk, derivatives risk and liquidity risk.

The performance shown is for the stated time period only and computed in U.S. Dollars (USD). Historical returns are not indicative of future performance. For further discussion of the Fund’s investments strategies and risks, please refer to the Investment Funds Description – P Series. This is not an offer to purchase securities.

Lending of Portfolio Securities

The Fund seeks to earn additional income by lending a portion of its portfolio securities to brokers, dealers and other financial institutions. The loans are secured at all times by cash and liquid high-grade debt obligations. As with any extension of credit, there are risks of delay in recovery and in some cases even loss of rights in the collateral should the borrower fail financially. In additionally, losses could result from the reinvestment of the cash collateral received on loaned securities.


Expense Ratio

All expenses of the Fund are deducted from the Fund’s net asset value. The expenses include investment management fees, operating expenses, bank custodial fees and miscellaneous Fund administration expenses. These expenses are paid directly by USEF, and are reflected in the unit price calculated for the Fund. The unit price is multiplied by the number of units held in each client’s account to determine the total value of the client’s holdings in the Fund. For 2020, USEF’s expenses were 0.56% of the fund’s total assets.