State Street Investment Management has announced the launch of the State Street SPDR UC Investments 90/10 Endowment Strategy Index ETF, an asset allocation exchange-traded fund developed in collaboration with UC Investments, the investment division of the University of California and the provider of the fund’s index. The launch is backed by a $2.5 billion seed investment from UC Investments. The ETF has been trading on NYSE Arca since September 1.
The fund aims to track the UC Investments 90/10 Endowment Strategy Index, which combines broad exposure to U.S. equities with exposure to short-duration investment-grade corporate bonds. The index allocates 90% of its weight to the S&P 500 Index and the remaining 10% to the S&P U.S. Investment Grade Corporate Bond 1-3 Year Index, which includes U.S. dollar-denominated, investment-grade corporate bonds with maturities between one and three years.
UC Investments and S&P Dow Jones Indices custom-developed this index, inspired by the institution’s $7.9 billion “Blue and Gold Endowment Pool”—a long-term strategy in public markets that, since its inception seven years ago, has been the top-performing product within UC Investments’ portfolio. The strategy reflects UC Investments’ conviction that low-cost, liquid, and diversified public market exposure can generate attractive long-term returns while avoiding the complexity and illiquidity of traditional endowment models.
By embedding this philosophy into an ETF, UCBG offers long-term investors access to UC Investments’ approach, which was previously only available within the institution’s portfolio and directly to employees across its ten campuses and six medical centers through its retirement savings program—the second-largest public defined contribution program in the nation, behind only the federal government’s.
“At UC Investments, we are focused on building long-term, cost-effective portfolios to support our hundreds of thousands of students, faculty, staff, and alumni for generations to come,” said Jagdeep Singh Bachher, Chief Investment Officer of the University of California. “The launch of this ETF brings our institutional investment philosophy within reach of a broader investor community through the transparency, efficiency, and accessibility of the ETF structure, while staying true to the principles that have guided our investment approach,” he added.
The ETF builds on State Street’s longstanding relationship with UC Investments. State Street Investment Management currently provides asset management services to UC Investments’ portfolio of over $200 billion, spanning pensions, endowments, and other assets, while State Street Bank and Trust Company provides custody and other investment services.
“Our relationship with UC Investments spans more than two decades and has always been driven by innovation. With this launch, we are bringing an endowment-inspired strategy to a much broader range of investors with the low cost and transparency that make ETFs so powerful,” said Ronald O’Hanley, Chairman and CEO of State Street Corporation.
“This collaboration demonstrates what can be achieved when a leading asset owner and asset manager work together to turn a successful institutional investment strategy into an accessible solution for investors,” said Yie-Hsin Hung, President and CEO of State Street Investment Management. “It reflects our commitment to helping clients expand their investment priorities into new markets and investor communities.”
