System investment committee terminates SCGE manager, approves ~1% allocation to Bal Yasny Atlas fund

The system's Investment Committee approved two resolutions to reshape parts of the system's public-equity and diversifying strategies allocations. Staff recommended terminating the contract with SCGE Offshore Fund LP and adding a roughly 1% position in the Bal Yasny Atlas Enhanced Fund to both the Pooled Endowment Fund and the Liquidity and Capital Reserve Pool.

Nolan Bean of Fund Evaluation Group reviewed recent market moves and the portfolios’ trailing returns, saying the pooled endowment and reserve portfolios have performed strongly over multiple time horizons but that the public equity sleeve needed some rebalancing. He described the committee's approach as combining “high-conviction active managers” with low-cost index funds to capture market returns where appropriate and to use diversifying strategies to smooth downside risk.

Bean explained the recommendation to terminate Sequoia Capital Growth Equities (SCGE) as a reallocation consistent with those goals. For diversifying strategies, staff proposed Bal Yasny, a multi-manager or "pod shop" that Bean said has delivered low correlation to the stock market and selective capacity to add capital. The committee viewed a short Bal Yasny student stock‑pitch video; a trustee observed that University of Alabama students had placed first in that competition and noted the program connection to the manager under consideration.

Justin Fanning, assistant vice chancellor for investments and treasury, presented the formal resolutions. After a motion and second, the committee approved the termination of SCGE's public-equity mandate and approved the approximately 1% allocations to Bal Yasny in both pools.

The committee vote was by voice and the resolutions were adopted; staff will proceed with termination and onboarding steps consistent with contract terms and internal approvals.