Veteran chief investment officer Collette Chilton quietly built and runs one of the country’s best institutional portfolios at Williams College, earning her the allocator Lifetime Achievement Award at Institutional Investor’s 2019 Hedge Fund Industry Awards.
In 2006, Chilton arrived at Williams as a breakout star of both the public and corporate pension worlds. She had no experience investing in hedge funds — and yet, over little more than a decade, she became nearly unbeatable. Her ongoing work, and that of her team, has already secured educations for generations of students to come.
The Williams endowment has roughly doubled under Chilton’s tenure at the Massachusetts liberal arts college, reaching $2.7 billion as of June 2018. Hedge funds make up about 40 percent of the portfolio, she says. Over the last decade, the fund’s returns rank in the top decile of U.S. endowments and foundations, and the investment office has added almost 40 basis points of alpha over its target annually.
This stunning track record follows two other successful CIO tenures: Chilton previously led the then-$30 billion Massachusetts pension system and Lucent Technologies’ $40 billion retirement fund.
“I’ve known Collette since her days at MassPRIM,” wrote Chris Ailman, CIO of California’s teacher retirement system, in an email. “She is truly one the best CIOs in the country and rivals the greats of all time in the endowment world.” He followed up to add, “#Rockstar and #FearlessWoman.”
Chilton and her team have resisted the ultra-competitive horserace of elite nonprofit investing, where there’s no greater mission than beating Yale. (For the record, Chilton and her team did beat Yale’s endowment over the 10 years ending in 2018, by 60 basis points.)
While flying very much under the radar, Chilton has earned the admiration of her peers across institutional categories.
Williams managing director Julia Crosby sees this firsthand. “Lots of CIOs seek her out for advice as they’re setting up investment offices — or perhaps looking for a new job,” Crosby says. “She’s willing to sit down for an hour and talk. It’s amazing how many people come up to me and say, ‘I spoke to Collette about this new role, and she really helped me out.’ She has had a tremendous impact on a lot of people’s careers across this industry.”
As a hedge fund allocator, Chilton’s success has come via discipline, networking, and judgement honed over decades.
“She’s very attuned to who Williams is, and how to play to our strengths,” said managing director Abigail Wattley, who started working for Chilton in 2007. “One of the things about her as an investor is that she’s incredibly disciplined and very consistent. For example, with hedge funds, we avoid strategies where we don’t understand how managers are creating their edge.”
Chilton recognizes the divergence between her team’s experience with hedge funds and many of their peers. “Unlike everyone else in the world who’s getting out of hedge funds, we really like hedge funds,” Chilton told Institutional Investor in a rare interview last week.
She attributes the Williams endowment’s success in part to the school’s deep network in the hedge fund world.
Asked to name her mentors, she cites “my four investment committee chairs at Williams: Dave Coolidge, Michael Eisenson, Jonathan Kraft, and Tim Barrows. They have all been great mentors to me in different ways at different times.”
[II Deep Dive: The Allocator Finalists for II’s 2019 Hedge Fund Awards]
Chilton will be honored at the 17th Annual Hedge Fund Industry Awards dinner at the Mandarin Oriental hotel in New York, on Thursday, June 27.
For more about the dinner, and for a full list of hedge fund investment manager and allocator finalists, please visit the Institutional Investor 2019 Hedge Fund Industry Awards website.
Winners will be announced at the event.