Investment Strategies

Objective: Using bottom-up fundamental diligence combined with quantitative technical analysis, the Constitution strategies’ primary objective centers on investing in private equity funds and co-investment opportunities managed by leading general partners, creating a private equity portfolio that is diversified by number of partnership investments, segments of the private equity markets, financing stages, geographic regions and industry sectors, in order to produce returns superior to the public markets and ranking in the top quartile of industry benchmarks.

Data as of December 31, 2015.

Funds within the strategy:

Objective: Using bottom-up fundamental diligence combined with quantitative technical analysis, the Liberty strategy’s primary objective centers on investing in private equity funds and co-investment opportunities focused on middle market stage companies, creating a middle market private equity portfolio diversified by number of partnership investments, type of security held within the funds, geographic regions and industry sectors, in order to produce returns superior to the public markets and ranking in the top quartile of industry benchmarks.

Data as of December 31, 2015.

Funds within the strategy:

Objective: Using bottom-up fundamental diligence combined with quantitative technical analysis, the Providence strategy’s primary objective centers on investing in venture capital funds and co-investment opportunities managed by leading venture capital general partners, creating a venture portfolio diversified by number of partnership investments, venture financing stages, geographic regions and industry sectors, in order to produce returns superior to the public markets and ranking in the top quartile of venture industry benchmarks.

Data as of December 31, 2015.

Funds within the strategy:

Objective: The Absolute strategy focuses on liquidity and aims to maximize the overall cash multiple on private equity investments by maximizing returns on the sale of securities distributed from private equity funds and co-investments relative to the price at which they are distributed while minimizing or eliminating associated costs and fees. Its goal is liquidity by converting to cash as quickly as possible. Securing the best pricing while concurrently minimizing trading costs, eliminating investment related fees and reducing the administrative burdens associated with distributions from private equity funds and with holdings in private equity funds later in life on the J-curve, the Absolute strategy seeks to enhance the overall private equity return performance. It employs a disciplined quantitative technical process for executing trades in which holdings with good fundamentals are held in order to contribute to performance and poor performers are quickly sold with best execution and price and cost. The time to cash liquidity and realization of each holding is based on the forecast for that unique holding and determined by employing the quantitative tools from our Investment Realization To Cash Services. Correct decisions for maximizing returns are made with this discipline combined with thoughtful analysis and expertise in the private and public markets.

Data as of December 31, 2015.

Objective:  The Independence strategy is currently being finalized and will focus on investing in secondary portfolios of brand name private equity funds that have leveraged buyout, venture capital, growth equity, mezzanine, distressed debt and related investments including co-investment opportunities. The strategy expects to be broadly diversified by number of partnership investments, financing stages, geographic regions and industry sectors, with the objective to produce returns superior to the public markets and that rank in the top quartile of industry benchmarks. Portfolio construction will be based on proprietary, structured transactions, supported by bottom-up due diligence and technical investment analyses.

Objective: The Excelsior strategy is a new strategy on the drawing board. With a goal of being among the most innovative private equity investment strategies, Excelsior Liquid Alternatives Strategy will be a version of Constitution Private Capital Strategies, but will focus on remaining fully invested in both primary fund investments, co-investments, and secondary opportunities, including diversified private equity mid-cap focused funds, large-cap buyouts, including mezzanine, and diversified venture capital funds. The strategy’s unique objective will include maintaining full exposure to the private equity markets upon initial investment without the need to retain substantial cash reserves and fixed income to meet capital call obligations of the underlying investments. The most innovative feature of the strategy includes an interval liquidity feature for converting illiquid long-term holdings into more liquid interests, or through SEC registration, designed to provide enhanced liquidity for the entire strategy.