Previously the COO and Managing Director at Columbia University’s endowment, Mercado will lead key operational teams, elevating both the investment and client experience.
Radnor, PA – April 16, 2026 – TIFF Investment Management, an independent, employee-owned investment firm specializing in OCIO services and alternative investment strategies, announced today that Julius Mercado, the former COO and Managing Director at Columbia University’s endowment, has joined TIFF as Executive Director and Head of Operations, Reporting, and Data.
In this role, Mercado will lead investment and fund operations, portfolio reporting, and data and analytics. He will oversee TIFF’s investment and client platforms, strengthening the quality, consistency, and accessibility of data and reporting, while supporting more efficient execution and coordination across the firm.
“Julius has built his career at the intersection of institutional experience and operational leadership,” said David Brenner, Chief Operating Officer of TIFF. “He has a demonstrated history of building and scaling multi-asset investment operating platforms across public and private markets, and brings deep expertise in data architecture and performance reporting. He will be key in advancing our platform and delivering an even stronger client experience.” Mercado’s addition deepens TIFF’s operational leadership and reflects the firm’s continued focus on building a high-performing, client-focused team.
Prior to joining TIFF, Mercado served as a strategic consultant to an OCIO supporting mission-driven organizations and began his career at PwC in the Asset and Wealth Management practice.
About TIFF Investment Management
TIFF Investment Management is an independent, employee-owned investment firm specializing in OCIO services and alternative investment strategies, including private equity, venture capital, and hedge funds. Founded in 1991, with approximately $10Bi in assets under management, TIFF draws on decades of experience to serve nonprofits, family offices, RIAs, and other sophisticated investors. As a certified B CorporationTM, TIFF embeds accountability, transparency, and sustainability into its operations and investment process. TIFF combines nonprofit expertise with institutional-quality access, partnering with long-term investors to deliver sustainable growth and enduring results that can advance their objectives over time. Learn more at www.tiff.org.
Past performance is no guarantee of future results and the opinions presented cannot be viewed as an indicator of future performance. There is no guarantee that any particular asset allocation or mix of strategies will meet your investment objectives.
The materials are being provided for informational purposes only and constitute neither an offer to sell nor a solicitation of an offer to buy securities. These materials also do not constitute investment, legal or tax advice. Opinions expressed herein are those of TIFF and are not a recommendation to buy or sell any securities.
These materials may contain forward-looking statements relating to future events. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” or “continue,” the negative of such terms or other comparable terminology. Although TIFF believes the expectations reflected in the forward-looking statements are reasonable, future results cannot be guaranteed.
Footnotes
i TIFF assets under management (AUM) is as of 9/30/25 and includes discretionary and non-discretionary client assets for which TIFF affiliates provide investment management or advisory services. The private markets portion of TIFF AUM is calculated based upon fund net asset value plus unfunded commitments. Calculation of TIFF AUM differs from the calculation of regulatory assets under management in TIFF’s Form ADV filings with the SEC and may differ from the AUM calculation methodologies used by other investment managers.
B Lab is the independent third party that certifies companies as B Corporations when they meet rigorous standards of social and environmental performance, accountability, and transparency. B Lab certified TIFF Advisory Services, LLC as a B Corporation on September 12, 2025. To remain certified, B Corporations must update and verify their information every three years.
Spend policy methodology often receives less attention than the spending rate itself, despite having an equally meaningful impact on the dollars flowing into an institution’s budget.
While Investment Committees and organizations carefully review the rate annually, the implications and trade-offs of the calculation methodology are often not well understood.
The key trade-off is between spending stability and long-term endowment growth.
Each organization should assess its own needs and priorities to ensure the methodology selected aligns with objectives.
All organizations should be aware that market factors influence each methodology differently.
Over its 35 years of experience, TIFF has guided clients to understand and select the best spending methodology to meet its objectives.
Rethinking Spend Policy: Why Methodology Matters More Than You Think
Spend policy methodology often receives less attention than the spending rate itself, despite having an equally meaningful impact on the dollars flowing into an institution’s budget. While Investment Committees focus on the rate carefully and annually approve it, they don’t often consider with the same rigor how the spend is calculated, even though the methodology has immense impact on the amount of dollars going into the budget on an annual basis.
Based on various studies, the trailing average market value is the most popular spend methodology.1 However, there are a multitude of other methodologies, each with their own trade-offs. A methodology will perform differently depending on the current economic environment and generally falls along a spectrum of ensuring consistency/growth of spend and protecting the endowment corpus (especially in times of drawdown).
This article provides a framework for institutions to consider their objectives and needs when it comes to their spend, and which methodology might best fit those needs.
The Three Main Types of Methodologies
Our Spend Policy 101 whitepaper gave an overview of the most commonly used and discussed methodologies. A brief summary is below:
Endowment Market Value: A predetermined percent of endowment market value, often on a trailing multi-year average basis.
Inflation-Based: Last year’s spend value increased by inflation, sometimes within a band.
Hybrid: A combination of market value and inflation.
There are other less common methodologies that we will not discuss in this article.
Trade-offs Among the Methodologies: A Framework for Consideration
Understanding what is important to your institution will help determine the best-aligned spend methodology. These factors should be documented in an institution’s spend policy, to ensure future leaders and fiduciaries understand the choices made. Each organization should assess their organizational preferences and objectives to help determine the best spend policy.
At a high level, institutions must balance institutional needs for consistency of spend value and what best helps build endowment value for the long term. TIFF has outlined conceptually where each methodology falls across these two considerations.
Source: TIFF internal analysis, representative view of consistency of spend.
A helpful starting point is assessing the institution’s sensitivity to changes in annual distributions. Organizations that rely heavily on endowment spending to fund their operating budget, or that have limited flexibility in other revenue sources, may prioritize policies that provide greater stability in spending levels. Institutions with more diversified or flexible funding sources may be better positioned to tolerate some variability in annual distributions in order to keep spending more closely aligned with investment performance.
Institutions should also consider their longer-term priorities for the endowment. Policies that prioritize consistency in spending can support budgeting and program stability but may require distributions during periods when the endowment is under pressure (e.g. taking out money during a market drawdown). Approaches that more closely track market performance may introduce short-term variability but can better protect the endowment’s ability to support future generations.
Key Questions for Institutions
To help an institution assess its endowment needs and what spend methodology might be appropriate, TIFF recommends focusing on the following questions:
How dependent is the institution’s operating budget on endowment spending, and how much variability in annual distributions can it realistically absorb?
If endowment spending declined meaningfully in a given year (e.g. 10–30%), how would the institution adjust its budget or operations?
How important is it for annual spending to grow consistently to keep pace with inflation and rising operating costs?
To what extent should spending be aligned with investment performance to protect the endowment’s long-term purchasing power?
This will help institutions assess their financial flexibility, reliance on endowment funding, need for predictable growth, and priority placed on endowment growth over time.
How Market Outlook Impacts Methodology
While it is difficult to predict future market and economic performance, it is important to recognize these factors, though out of any individual’s control, have an impact on the dollars in the institution’s pocket depending on the chosen methodology. While TIFF doesn’t support selecting a spend methodology based on market outlook, institutions should still be aware of the impact market factors have on their choice.
An institution can broadly anticipate each methodology to perform better in a different environment. While there are multiple inputs in the various spend methodologies, there are three key market factors across all of the approaches: (1) inflation, (2) market performance, and (3) market volatility.
A moving average will provide the highest dollars in the withdrawal when market performance is high and inflation is low (e.g. during the 2010s). An inflation-based methodology will produce the highest spend in a stagflation environment, where the spend increases to match inflation as the markets are flat (if not down). Hybrid, as it is a blend, typically ends in the middle of outcomes between market- and inflation-based approaches.
Chart: Case Study of Market Factor Impact on Spending Value
Source: TIFF Internal analysis, representative of average approach of each type.
Conclusion
Endowment spending policy is ultimately a reflection of an institution’s financial priorities, risk tolerance, and long-term mission. While the spend rate often receives the most attention, the methodology used to calculate that spending can have an equally meaningful impact on both annual budget support and the preservation of the endowment over time. By thoughtfully considering the trade-offs between spending stability and long-term endowment growth, and by aligning methodology with the institution’s financial structure and objectives, organizations can adopt a policy that supports both present needs and future generations. A well-documented approach ensures that these decisions remain intentional and well understood by future leaders and fiduciaries.
For 35 years, TIFF has helped endowed nonprofits achieve their investment goals to support their missions. One element of that support involves providing strategic governance advice to institutions as they navigate these challenging and “no-right-answer” topics. TIFF helps guide institutions toward the answer that best aligns with their organization’s financial structure, priorities, and mission.
Past performance is no guarantee of futureresultsand the opinions presented cannot be viewed as an indicator of future performance. There is no guarantee that any particular asset allocation or mix of strategies will meet your investmentobjectives.
The materials are being provided for informational purposes only and constitute neither an offer to sell nor a solicitation of an offer to buy securities. These materialsalso do not constituteinvestment,legalor tax advice. Opinions expressedhereinare those of TIFF and are not a recommendation to buy or sell any securities.
These materials maycontainforward-looking statements relating to future events. In some cases, you can identify forward-looking statements by terminology such as “may,”“will,”“should,”“expect,”“plan,”“intend,”“anticipate,”“believe,”“estimate,”“predict,”“potential,” or “continue,” the negative of such terms or other comparable terminology. Although TIFF believes the expectations reflected in the forward-looking statements are reasonable, future results cannot be guaranteed.
The referenced case study is included for illustrative purposes only, and was selected for inclusion based onobjective, investment guidelines-based criteria for the purpose of describing the investment processes and analyses that TIFF uses to evaluate such investments.
Footnotes
FY25 Commonfund-NACUBO Study of Endowments, FY25 Commonfund-NBOA Study of Independent Schools.
Institutional Investor: Growth Is Shifting to Private Markets
Kane Brenan
Chief Executive Officer & Board Member of TIFF Advisory Services
In a recent Institutional Investor article on growth versus value investing, comments from Kane Brenan, CEO of TIFF Investment Management, highlight that many of today’s largest growth opportunities are increasingly occurring in private markets. The article draws on Brenan’s earlier remarks published in Essential Allocator, Institutional Investor’s weekly newsletter for institutional allocators (February 13, 2026).
Past performance is no guarantee of future results and the opinions presented cannot be viewed as an indicator of future performance. There is no guarantee that any particular asset allocation or mix of strategies will meet your investment objectives.
The materials are being provided for informational purposes only and constitute neither an offer to sell nor a solicitation of an offer to buy securities. These materials also do not constitute investment, legal or tax advice. Opinions expressed herein are those of TIFF and are not a recommendation to buy or sell any securities.
These materials may contain forward-looking statements relating to future events. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” or “continue,” the negative of such terms or other comparable terminology. Although TIFF believes the expectations reflected in the forward-looking statements are reasonable, future results cannot be guaranteed.
They allow TIFF to isolate managers’ idiosyncratic stock risk from factor risk, illuminating manager value-add.
Granular holdings data enables precise portfolio construction and risk management.
TIFF utilizes these elements in portfolio construction, risk management and manager selection.
Overview
For the marketable equity allocations, one of the most important portfolio analysis views is provided by security-level holdings. For most of our marketable equity managers, TIFF receives security-level detail, meaning what stock is held and at what size. This information is in addition to traditional exposure reports most managers provide. This level of detail allows TIFF to have a more robust and accurate view of our portfolio and to manage our exposures appropriately. The multi-dimensional, timely detail inherent in holdings is critical to TIFF’s risk management and equity portfolio construction approach.
Why are holdings so important? There are three key reasons:
Granularity & Specificity: Holdings tell us the magnitude and sources of exposures at the most granular possible level.
Idiosyncratic Risk Identification: Active managers’ specific stock views are the primary source of value in TIFF portfolios. The only way to identify and measure the individual risk and impact of these individual positions net of their generic factor exposures is to know the positions in detail.
Actionable Risk Management: Knowing detailed manager holdings enables TIFF to manage portfolio risk with passive exposures and hedges with more efficacy and precision, and with less chance of overlooking an important exposure or of inadvertently offsetting managers’ specific stock views. Tracking the performance of individual stocks allows us to track these factor exposures in near-real time without having to rely on manager updates.
1. Granularity & Specificity
Security-level holdings allow us to understand our exposures, both magnitude and sources, at the most granular level possible. TIFF works with its managers to get holdings level data beyond the traditional exposure returns, allowing TIFF a better understanding of those exposures. Granularity below the summary level matters, sometimes very much.
Active equity managers will generally provide summaries of portfolio exposures at the regional level (e.g., US, EAFE, EM) or sector level (e.g., healthcare, IT). They may bucket market capitalization in broad categories (e.g., mega, large, small cap). To the extent they track style factors, the information they share is generally qualitative (e.g., “overweight growth”). Style factors are security-specific characteristics, such as Value (price:book), Profitability (profit:revenue) or Momentum, that help explain risk and return of a stock.
Case Study: Sector Distinctions that Matter
These kinds of industry-level distinctions are significant more often than not.
Healthcare comprises both large cap value-like pharmaceuticals (J&J, Pfizer), and small cap volatile biotech. It is one thing to have no net exposure to either industry and a very different thing to report no net healthcare exposure while being 5% overweight biotech and 5% underweight pharma.
Both software and semiconductors are components of IT, recently displaying dramatically different behaviors.
Case Study: Style Factor Decomposition
For style factors, granularity illuminates how a given factor is arising. Style factors are defined on a spectrum comparing a given portfolio’s exposure to the average exposure of the full equity investing universe. A style such as a Profitability overweight can arise via larger holdings in stocks that are more profitable than average or, instead, via underweights to unprofitable stocks. These are very different portfolio constructions that look the same at the qualitative “overweight Profitability” level.
2. Idiosyncratic Risk Identification
TIFF primarily aims to add value by identifying and investing with active managers that take idiosyncratic risk, risk over and above the factor risk inherent in their portfolios. A number of such TIFF managers take a “fundamental” approach, characterized by concentrated portfolios of stocks with relatively long-term investment theses (i.e., not high-frequency trading strategies), each of which is selected to deliver outperformance vs. similar stocks with similar factor profiles. The only way to understand the portfolio’s sources of idiosyncratic risk and their performance is to analyze these at the individual stock level.
Even among very similar stocks the differences in ex-ante risk and ex-post performance can often be dramatic. Although Nvidia and Analog Devices are both larger cap semiconductor designers, there has been a massive difference between these stocks over the past few years. This year, there has been extreme dispersion between AI “winners” and “losers” within the software industry.
Absent holdings data, it is very difficult to tell how effectively fundamental managers are taking idiosyncratic risk. While they will generally manage to self-selected benchmarks such as the S&P 500 (SPX), or even much more specific ones such as the NASDAQ Biotechnology Index (NBI), they will generally take on factor risks with respect to these benchmarks. Without knowing their factor-driven performance we cannot identify their idiosyncratic performance. Even if a manager were to report total idiosyncratic performance, we are very interested in the details. Did a manager rely on a single Nvidia-like outperformer? Or did they generate idiosyncratic alpha across their portfolio?
Longer term, the factor postures and idiosyncratic risk efficacy of our managers are critical to understanding whether a manager is adding value and whether we maintain, upsize or redeem our positions.
3. Actionable Risk Management
The detail we get from holdings only really matters if it is actionable. We use this information to fine-tune our portfolio factor exposures through a few techniques including:
passive ETF exposure
custom baskets of individual stocks, designed to offset any unwanted factor exposures at an equally granular and timely level. Knowing our managers’ intentional idiosyncratic risk-generating stock selections, we exclude any such overweighted stocks from our custom factor hedges to avoid inadvertently negating managers’ views.
Where Holdings-Level Doesn’t Matter
We are equally careful not to overuse holdings information. Alongside fundamental managers, we intentionally allocate to “systematic” managers (including multi-manager portfolios). These strategies are characterized by much more diversified portfolios with many more individual stocks and are also often characterized by higher-frequency trading strategies. Many systematic managers are not seeking to generate idiosyncratic risk via fundamental stock analysis but rather via proprietary strategies that take advantage of factor-like characteristics that are different from the common factors that we concentrate on in our factor analysis.
Knowing the holdings of these strategies does not help us; but, critically, we know that these managers carefully manage their traditional factor exposures. That means that if they say they are managing to a benchmark such as SPX or NBI, we can count on them to match the factor exposures of that benchmark. We can then confidently use the benchmark’s holdings as a proxy in our holdings-based factor analysis. We can also confidently ascribe all their performance vs. that benchmark to idiosyncratic risk. In this way, we appropriately combine holdings detail across different types of managers in our analyses and portfolio management.
Holdings-Level Detail Matters
Holdings detail is central to our equity portfolio management. Whether via fundamental manager individual stock holdings or very reliable proxies for systematic managers, we rely on it and would feel partially blind without it — to the extent that this information is a prerequisite for inclusion in our portfolios. We use it to efficiently and effectively construct portfolios with only the factor exposures we seek, minimizing unwanted, unproductive factor risk. In doing so, we allocate more of our risk budget to productive idiosyncratic risk, the area where our managers differentiate themselves and add value.
The materials are being provided for informational purposes only and constitute neither an offer to sell nor a solicitation of an offer to buy securities. These materials also do not constitute an offer or advertisement of TIFF’s investment advisory services or investment, legal or tax advice. Opinions expressed herein are those of TIFF and are not a recommendation to buy or sell any securities.
These materials may contain forward-looking statements relating to future events. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” or “continue,” the negative of such terms or other comparable terminology. Although TIFF believes the expectations reflected in the forward-looking statements are reasonable, future results cannot be guaranteed.
Top 1000 Funds: Why Active Management Matters in Emerging Markets
Zhe Shen, CFA
Managing Director, Head of Diversifying Strategies
In a recent Top1000funds.com article on emerging markets, Zhe Shen, Managing Director, Head of Diversifying Strategies at TIFF Investment Management, discussed how the rise of AI is contributing to Asia’s evolving role in global manufacturing and why accessing this opportunity can benefit from active managers with deep local insight.
The materials are being provided for informational purposes only and constitute neither an offer to sell nor a solicitation of an offer to buy securities. These materials also do not constitute an offer or advertisement of TIFF’s investment advisory services or investment, legal or tax advice. Opinions expressed herein are those of TIFF and are not a recommendation to buy or sell any securities.
These materials may contain forward-looking statements relating to future events. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” or “continue,” the negative of such terms or other comparable terminology. Although TIFF believes the expectations reflected in the forward-looking statements are reasonable, future results cannot be guaranteed.
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