The NC State Investment Fund, Inc. (Fund) was created in 1998 as a North Carolina not-for-profit organization exempt from income tax under Section 501(c)(3) of the Internal Revenue Code and was established to support North Carolina State University (the “University”) by operating an investment fund for the Endowment Fund of the University and other University-affiliated foundations. There are no involuntary participants in the Fund pool.
The goal of the Fund is to provide a real total return from endowed assets invested that will preserve the purchasing power of Fund capital, while generating an income stream to support the spending needs of the University and its Associated Entities.
The Fund is managed as a broadly diversified portfolio with exposure to eight primary asset classes and many sub-strategies within each asset class. The Fund seeks to diversify exposure to the sub-strategies through the use of multiple investment managers that utilize a variety of investment approaches. The purpose of diversification is to provide reasonable assurance that no single security, class of securities, or investment manager has a disproportionate impact on the Fund’s aggregate results. The focus on controlling volatility preserves capital and benefits Fund participants through the power of compounding.
The Fund’s oversight is provided by the Fund’s Members Board and its Board of Directors. The Members Board provides governance and oversight to the Fund. The Members’ Board’s role includes approving other governance documents including bylaws, operating agreements, participant agreements, asset-based fees, and other policies, as it relates to the Fund. The Board is elected by the Members’ Board. The Board of Directors’ primary role is to develop investment policies, oversee the allocation of the Fund’s portfolio among asset classes, and investment vehicles, and to monitor investment managers and overall performance.
As of June 30, 2021, the Fund had a market value of $1.59 billion, a year-over-year increase of approximately $505.2 million. The Fund has experienced considerable growth over the last ten years with its market value expanding at a compounded annual growth rate (CAGR) of 15.5%. For the last five years, the growth rate has been even more robust, with the Fund growing at a 18.5% CAGR.
As of June 30, 2021, the Fund outperformed both of its stated benchmarks over 1-, 3-, 5-, and 10-year investment horizons. The Fund’s absolute performance has been strong across those time periods with returns of 39.3%, 15.1%, 13.8% and 10.5%, respectively.