As we close our fiscal year, I welcome the opportunity to pause and reflect through my annual letter. Below, I share my thoughts on the overarching themes we’ve witnessed in the markets over this period, as well as provide a few noteworthy firm and team updates.
As I look back over the past twelve months, my conviction in our disciplined, long-term focus and diversified investment approach remains as strong as ever. While this period saw unique challenges, including tariff uncertainty and a national focus on college and university endowments, it also encompassed a deepening of relationships with our clients, industry peers, and colleagues. The ability to make a positive impact through our work and mission – to invest in the lives of others – drives me and our team each day. As we review Verger’s results, we remain pleased with our portfolio’s long-term track record of participating in the upside when markets are performing well, while protecting capital when markets are experiencing a downturn.
Market Themes
One key theme that remained relevant throughout the fiscal year was steady steering through volatility. In our 2024 Q3 Market Outlook, we highlighted our expectations that markets would continue to experience bouts of volatility and likened long-term investing to long-haul air travel. Importantly, the process of steering through heightened turbulence requires extensive preparation, focus, and discipline and often requires the fortitude to remain on the ultimate flight path, despite short-term term jolts of turbulence and market fluctuations.
Continuing this line of thinking, our 2024 Q4 Market Outlook outlined our view that a reliable investment process looks past short-term bouts of volatility and does not seek to chase trends or match declarations about what is “in” or “out.” Instead, Verger focuses on maintaining a disciplined, all-weather investment strategy that can withstand changing market conditions and evolving investor sentiments.
These reflections on volatility remained relevant and became even more important as early 2025 saw a series of aggressive trade policies, increased corporate uncertainty, and dampened investment sentiment. In our March 2025 piece titled Market Volatility: Strategies for Endowments and Foundations, we reminded readers that the team at Verger doesn’t just expect market volatility, we prepare for it. While the range of possible outcomes going forward for both the economy and financial markets at the time (and indeed, now) was (and remains) quite wide, this is nothing shocking or new. Both recent and storied history are filled with unexpected timing of market cycles and financial events resulting in notable market swings.
In our 2025 Q1 Market Outlook, we reiterated our view that Verger’s all-weather and antifragile portfolio is particularly well-designed to meet moments of heightened uncertainty, where a combination of geopolitical and economic challenges create idiosyncratic investor behavior and continued market volatility. We again highlighted the importance of a steady hand on the wheel and our commitment to monitoring markets closely, staying in close contact with our investment managers, and evaluating if and how the long-term drivers of risk and return could be shifting.
Going forward, many of the themes discussed throughout the year remain relevant and even top of mind. While the most recent quarter featured (perhaps surprisingly) quite optimistic market results, our 2025 Q2 commentary borrowed language from the world of gambling and pointed out the crucial importance of sticking to our long-term focus and disciplined approach rather than following the current trend of “doubling down” or going “all in” on U.S. equities in the wake of a recent “hot streak.” Outside of large cap U.S. equities, we currently see compelling opportunities in non-U.S. equities, natural resources, precious metals, reinsurance, mortgages, and emerging market debt.
Team Activities, Leadership, and Living Verger’s Values
One of the most rewarding parts of my role as CIO is to help develop and nurture a talented team of investment professionals. This past fiscal year has been marked by a continued growth of our team, including the promotion of Taylor Jackson to Managing Director, a reflection of both his strong contributions and leadership at the firm. Additional highlights include a rigorous schedule of manager updates, including many in-person meetings in the U.S. and abroad, conferences, panels, and in-depth research. Working closely and collaboratively to source and diligence compelling investment opportunities continues to be at the heart of our investment approach, and we’ve added new manager relationships that I have strong conviction will be additive to our client portfolios. The deep network and relationships that we build and maintain are integral to our long-term success.
As highlighted in Verger’s first Annual Report, the investment team is honored to be part of Verger’s continuing commitment to embodying our values and living our mission. Whether it be through community engagement and partnerships, employee led engagement and philanthropy, or mentoring with Girls Who Invest (GWI) or Verger’s Internship Program, we are committed to understanding each other’s needs and the needs of our communities and providing resources to make a positive impact.
As I look forward to another fiscal year, I am grateful to be part of this strong, cohesive team and feel well prepared to weather a wide range of market conditions with these colleagues at my side. I speak for the full investment team when I say thank you for your continued partnership and the opportunity to help you pursue your non-profit missions.
With best wishes for a great remainder of your summer,
Craig Thomas, Chief Investment Officer
Photo: Craig Thomas and Taylor Jackson on a due diligence trip, London, Spring 2025.