private asset management investment solutions ... - TIAA-CREF

PRIVATE ASSET
MANAGEMENT
INVESTMENT SOLUTIONS DESIGNED
TO HELP MEET YOUR NEEDS

ABOUT TIAA-CREF TRUST COMPANY
TIAA-CREF Trust Company provides Private Asset Management, estate
planning and fiduciary services for individuals, families, foundations
and other institutions. As part of the wealth management arm of TIAA-
CREF, we have been helping our clients achieve their financial goals
for more than a decade. From asset allocation to investment selection,
account service and more, our asset management approach is driven
by—and personalized to meet— your distinct needs.
At TIAA-CREF Trust Company, we believe that
just as no two investors are alike, neither are
any two foundations, families, or businesses. We
also understand that as wealth increases, so does
the complexity of wealth management needs.
This is why we take an individual approach to
asset management—designing personalized
investment solutions one by one to help you
achieve your unique goals.
As a fiduciary, we understand the daunting
responsibility of growing an endowment or leaving
a legacy. As an asset manager, we understand
the critical importance of generating income that
lasts for generations. And as an experienced
team of professionals, Private Asset Management
has the expertise, resources and dedication you
need to get where you want to go.

10%
$100,000
-10%
YEAR 1 YEAR 2
DOWNSIDE UP
In this hypothetical example, both
portfolios begin with an initial
investment of $100,000. Portfolio A
outperforms in year 1 and Portfolio B
outperforms in year 2. Looking at
average returns, you might conclude
that these portfolios performed the
same. But did they? Portfolio B is
worth $1,500 more than Portfolio A.
Why? Because Portfolio B outperformed
during the down market,
rather than the up one. This is why
we believe that managing downside
risk is so critical to your portfolio
over the long term.
YEAR 1 YEAR 2 AVG ANNUAL RETURN TOTAL
PORTFOLIO A 15% -20% -2.5% $92,000
PORTFOLIO B 10% -15% -2.5% $93,500
This illustration is not intended
to depict the performance of any
specific investment or account. Past
performance is not indicative of
future returns.
THE UPSIDE OF THE DOWNSIDE
Some managers believe the best way to generate excess returns is to take on
additional risk, assuming that outperforming when markets are up is the
best way to grow your portfolio. As volatile markets have proven, however,
outperforming during downtimes can actually be more important to the
health of your portfolio. This is especially true for retirees, endowments or
foundations that may be consistently withdrawing funds over time. We have
always believed in—and focused on—managing downside risk while striving
to achieve strong investment returns. The example above illustrates the
difference this can make.
REDEFINING ASSET ALLOCATION
Following the unprecedented market events, many were left wondering
why asset allocation didn’t work as well as they expected. Like with any
science, changing or new circumstances often lead to breakdowns—and
breakthroughs. Our Investment Strategy Group has developed innovative
allocation models exclusively for our clients. These evolved allocations
provide more diversifiers and fewer equities than “traditional” allocations
and are designed to help you:
Negative markets are not all bad news—even if the only positives are
the lessons we learn. The events of 2008 and 2009 taught investors the
importance of risk management, advanced asset allocation, and keeping
a long-term perspective. At Private Asset Management, these three
tenets have always driven our investment philosophy and are the key
to providing the potential for better risk-adjusted returns.
· Improve your overall risk-adjusted returns
· Manage your downside risk
· Improve your downside risk posture in extreme market environments
TAKING THE EMOTIONS OUT OF INVESTING
When it comes to investing, emotions may work against you. In fact, research
has shown that following emotions can lead to investment decisions that
will cost you and your portfolio for years to come. That’s why it is critically
important to have a professional manager and a long-term investment plan
designed to meet your individual objectives. Our Portfolio Managers are
experienced professionals trained to navigate your portfolio through every
kind of market, so you stay on track toward your goals.
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Whether you are a foundation, a client who has
put your assets in trust, or an individual with a
taxable account, we approach our responsibilities
the same way. As we conduct due diligence,
fundamental research or investment selection,
we are always focused on what’s best for you.
ACCESS TO INDUSTRY LEADERS
Our Investment Strategy Group knows that the investments we approve today may be going into your
portfolio tomorrow. To help ensure we are providing a selection of what we believe to be the best possible
funds, we use a disciplined due diligence process to review investments and investment managers on a
consistent basis. We scrutinize each potential mutual fund, Exchange-Traded Fund (ETF) and alternative
investment from every possible angle, ensuring that each investment:
· Behaves as we expect
· Costs what it should
· Supports a wide array of individual preferences
Only when we are certain we would trust a manager with our money will we recommend that you trust
them with yours. See the highlights of our process for yourself at right.
BUYING COMPANIES, NOT STOCKS
When researching individual equities (for desiring and qualifying clients), we consider each stock as if
we were buying the whole company. We conduct exhaustive fundamental research into how the company
is financed and managed. We want to know if they have a scalable business model, strong managers
and a distinct competitive advantage. If it’s a business we would consider owning, then it’s a stock we’ll
consider buying.
actively managing portfolios and risk
Our disciplined investment process focuses on delivering long-term performance while preserving capital
through stringent risk management. We take an active approach—studying economic trends, interest
rates and the credit environment—not only to identify market opportunities, but to capitalize on them as
well. Our experienced team selects only the high-quality securities with the potential necessary to deliver
the competitive total return clients want and need over the long term.
QUANTITATIVE EVALUATION
MUTUAL FUND AND ETF UNIVERSE
CORE LIST
QUALITATIVE REVIEW
Reference
List of Approved
Investments
STRINGENT DUE DILIGENCE
Through a strict process combining both quantitative
and qualitative analysis, the Investment Strategy Group
selects and continuously monitors an approved list of
funds. Portfolio Managers can select from this list the
funds they believe will best meet your objectives.
During the quantitative evaluation, the Investment
Strategy Group screens for asset class, subclass, style
and operational criteria. Then, we sort the investments
into passive, active and alternative strategies and rank
them by performance.
During the qualitative review, the Investment Strategy
Group conducts rigorous analysis of the fund complexes
and investment strategies. Next, we interview each
manager regarding their research process, risk management
process and asset valuation methodology. Finally,
we select the funds and ETFs we believe to be the best in
each asset class.
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DESIGNING THE RIGHT SOLUTION—TOGETHER
At Private Asset Management, we take a very collaborative, very individual
approach to working with clients of all kinds. We will work closely with you to
understand your distinct situation and unique needs in order to build the
right solution for you, your family, or your foundation.
“The closer we get
to retirement, the more
I realize the need
to have one advisor
looking at everything
from a comprehensive
perspective.”
CLIENT: Lydia Hayden
AGE: 55
OCCUPATION: Professor
FAMILY: Married w/ Two Grown Children
CURRENT INCOME: $150,000
PORTFOLIO SIZE: $1.2 million
CURRENT PROFILE: Between my husband
and myself, we have several accounts with
a number of different investment firms and
they’re all being managed independently.
The closer we get to retirement, the more
I realize the need to have one advisor
looking at everything from a comprehensive
perspective. We would like to be able to
maintain our two homes, while ensuring
we have enough income to last us throughout
our retirement. My Wealth Management
Advisor recommended consolidating
our assets in a customized Private Asset
Management Portfolio.
PRIOR TIAA-CREF RELATIONSHIP:
Participant
INDIVIDUAL PRIVATE ASSET
MANAGEMENT INVESTMENT SOLUTION:
As Lydia and her husband are looking for a
balance between capital preservation and
the opportunity for income, a Long-Term
Conservative allocation has been selected.
The portfolio uses mutual funds and ETFs
to provide substantial fixed-income exposure
across corporates and governments
in the United States and abroad. Exposure
to growth-oriented equity mutual funds
offers potential for principal growth and
protection against inflation.
“I’m comfortable taking
business risks, but don’t know
as much about investing.”
CLIENT: Martin Albertson
AGE: 46
OCCUPATION: Entrepreneur/
Business Owner
FAMILY: Married w/Three Children
CURRENT INCOME: $300,000
PORTFOLIO SIZE: $3.5 million
CURRENT PROFILE: 10 years ago, I quit
my job and started my own company
selling a medical device I invented. I’ve
been very fortunate in business, but one
of my brokerage accounts took a huge
hit in 2008-2009. I’m comfortable taking
business risks, but don’t know as much
about investing. I like the approach Private
Asset Management takes. I trust my team
and believe they will help me grow my
nest egg, so I can pay for college for my
three kids, retire comfortably and support
my family’s future.
PRIOR TIAA-CREF RELATIONSHIP: None
INDIVIDUAL PRIVATE ASSET
MANAGEMENT INVESTMENT SOLUTION:
Given Martin’s current income, willingness
to take risks, and long time frame, a Very
Aggressive allocation has been selected.
The portfolio is aggressively allocated
toward equities. Individual stocks will be
selected for large- and mid-cap allocations,
supplemented by mutual funds, ETFs,
and long/short equity funds. A portfolio
of individual bonds will provide the fixedincome
exposure.
“I would like to
establish a trustee
relationship to give
me peace of mind,
knowing that someone
knowledgeable can
step in to manage our
affairs if and when I’m
no longer able.”
CLIENT: David Hershey
AGE: 70
OCCUPATION: Retired Physician
FAMILY: Married w/ Grown Children
& Grandchildren
CURRENT INCOME: $200,000
PORTFOLIO SIZE: $10.2 million
CURRENT PROFILE: As a doctor, I’m well
aware of all the things that can go wrong
as we age. My wife and I have built a
beautiful family and a fair share of wealth.
I’ve always been the one to manage our
financial needs and investment relationships.
I would like to establish a trustee
relationship to give me peace of mind,
knowing that someone knowledgeable can
step in to manage our affairs if and when
I’m no longer able. My wife and I would
also like to set up Trust accounts to pay
for the education of our grandchildren.
PRIOR TIAA-CREF RELATIONSHIP:
Participant
INDIVIDUAL PRIVATE ASSET
MANAGEMENT INVESTMENT SOLUTION:
Because David wishes to be actively
involved in initial investment decisions
for the Trust, an Investment Advisory
Account has been selected. A Long-Term
Moderately Aggressive allocation has
been chosen in order to seek to grow the
assets for the benefit of David’s children
and grandchildren. As the Hersheys have
no current need for investment income,
the portfolios will be tilted toward equities
and a portfolio of individual stocks will be
diversified with mutual funds. The smaller
sub-accounts (Trusts for the grandchildren)
will be managed as a single portfolio using
the same strategy.
“We needed to find an institutional
investment manager that we could
trust to provide us with more
thoughtful investment advice.”
CLIENT: University Medical Foundation
CURRENT INCOME: N/A
PORTFOLIO SIZE: $32 million
CURRENT PROFILE: Following several
years of market-lagging performance,
the Board of Directors of our Foundation
determined we needed to find an institutional
investment manager that we could
trust to provide us with more thoughtful
investment advice. Our Investment Policy
Statement no longer reflects our needs
and we would like to improve our returns
in order to meet our 4% per year spending
commitments. David Hershey, a TIAA-
CREF participant, is on our investment
committee—and he recommended TIAA-
CREF wholeheartedly.
PRIOR TIAA-CREF RELATIONSHIP: N/A
INDIVIDUAL PRIVATE ASSET
MANAGEMENT INVESTMENT SOLUTION:
Based on spending concerns and the
income needs of the University Medical
Foundation, a Long-Term Moderate allocation
was selected. A taxable portfolio of
individual bonds, supplemented with highyield
and emerging market debt, will be
used to meet the spending requirements
of the foundation. The equity portion would
include a portfolio of individual stocks,
as well as long/short mutual funds and
REITs for diversification.
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A lasting legacy means different things to different people. So does
growing an endowment—or even creating retirement income. Whatever
your goals are, we will dig deep to uncover what they really mean to you or
your organization. Only when we truly understand the detailed future you
envision can we create the right investment plan to meet your needs.
STEP 1
ESTABLISHING YOUR GOALS AND ACCOUNT TYPE
Once we understand your unique needs and review your current
portfolio, risk profile and other information, we will:
Develop your investment objectives
Write your Investment Policy Statement
Set up the appropriate account type: Trust, IRA, agency, or other
Establish accounting procedures and sub-accounts, if required
STEP 2
CREATING YOUR ASSET ALLOCATION
Based on your investment objectives, risk profile and tax considerations, the Investment
Strategy Group will align your needs with one of our many asset allocation models—
detailing how your portfolio should be allocated between equities, fixed income, cash,
and in some cases, real estate.
STEP 3
CONSTRUCTING YOUR PORTFOLIO
After learning your personal preferences regarding socially responsible investments,
active vs. passive management, and tax efficiency, your dedicated Portfolio Manager
will build your custom portfolio.
In each asset class, your Portfolio Manager will personally select—from those on
the approved list—the mutual funds and ETFs they believe will best meet your unique
needs, objectives and preferences. If appropriate, they may also select individual
stocks or bonds.
STEP 4
ONGOING RISK MANAGEMENT, REVIEW AND MORE
Your portfolio is continuously monitored—on an individual investment and overall
basis—to ensure it remains in line with both your risk and performance expectations
and ours. To keep you on track toward your goals, your Portfolio Manager will regularly
rebalance your portfolio, communicate results, and discuss any changing needs or
objectives you may have. Additionally, if you have external managers, accountants,
attorneys, or other counselors, we will coordinate with them to ensure a completely
integrated approach to meeting your needs.
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PERSONALIZED INVESTMENTS
You are at the center of our Personal
Asset Management services—we
are always available to meet your
personal investment needs.
PERSONAL ATTENTION FOR INDIVIDUAL NEEDS
Truly personalized investment management requires truly personal attention.
Private Asset Management will assemble a team of professionals—chosen based on
your distinct needs—who will be dedicated to your portfolio and your best interests.
You will never be a number to us.
WE DESIGN THE RIGHT TEAM FOR YOU
From trusts and estate planning to tax efficiency and everyday account
management, your complex needs require specialized expertise. Private
Asset Management will leverage our own significant internal resources as
well as those of TIAA-CREF, if necessary, to build a team of professionals
dedicated to your success.
CALL ON OUR EXPERTISE—ANY TIME
Because we are your team, we are available to consult with you at your
convenience. You can speak directly with your personal Portfolio Manager
any time you have a question or concern, or just want to chat about your
investments. Additionally, as each member of your team is intimately
familiar with you, your goals, and your portfolio, you can also call them
with any questions you may have.
{ WEALTH MANAGERS }
{ ESTATE PLANNERS }
{ PORTFOLIO MANAGERS }
WE WORK WELL WITH OTHERS
To ensure a holistic approach to your financial planning, we will collaborate
with any external professionals who may be working on behalf of you
or your foundation. We will work closely with your accountants, lawyers,
tax professionals, insurance and other specialists to ensure the seamless
implementation of your strategy and the complete integration of your
accounts and information.
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WE SUCCEED WHEN YOU DO
At Private Asset Management, we do not
measure our success by accounts opened or by
assets under management. We measure our
success by the achievement of your goals. That
is why we take such an individual approach to
investment management. We know that you can
only reach your unique goals when you have a
plan that was designed specifically for you.
Whether your desire is to leave a legacy for your
children, to grow your foundation’s endowment,
to meet your income needs in retirement—or
anywhere in between, Private Asset Management
can offer the individual solution you need and
the service you deserve.
To start designing your individual plan, please
contact a Trust Company representative. Or
call 888 842-9001.

Investment products, insurance and annuity products: are not FDIC
insured, are not bank guaranteed, are not deposits, are not insured
by any federal government agency, are not a condition to any banking
service or activity, and may lose value.
The tax information contained in this booklet is not intended to be used
and cannot be used by any taxpayer for the purpose of avoiding tax penalties.
It was written to support the promotion of TIAA-CREF Trust Company,
FSB. Taxpayers should seek advice based on their own particular circumstances
from an independent tax advisor.
© 2011 TIAA-CREF Trust Company, FSB, One Metropolitan Square,
211 North Broadway, St. Louis, MO 63102-2733
C47652 A12412 (02/11)