GRAINGER: Hedge funds deliver opportunity

FILE - In this May 17, 2018, file photo, new graduates line up before the start of the Bergen Community College commencement at MetLife Stadium in East Rutherford, N.J. Many new college graduates are struggling to find work as their first student loan payments loom on the horizon. Fewer entry-level jobs are available during the pandemic, and unemployment benefits typically aren’t accessible. (AP Photo/Seth Wenig, File)

It was my honor to be elected to six terms to the Board of Governors of the University of North Carolina. The Board of Governors oversees the 17 campuses of the state’s higher education system, which is known as the most prominent and highly sought-after public university system in the nation. This reputation didn’t happen by accident. Like most successful stories in life, hard work, discipline, vision, and a keen understanding of investment strategies is the way to achievement.   

During my terms on the UNC Board of Governors, I worked with my colleagues and the President of the University of North Carolina system, as well as the respective chancellors, to make sure we had adequate investments by the schools to pay for scholarships and other expenses that the General Assembly didn’t fund with taxpayers’ money. I’m proud that we created a state system of higher education which is the envy of the nation.   

We worked smartly with our investment and hedge fund managers to create amazing opportunities for our North Carolina families and children who wanted to go to college. We are proud of that legacy.   

Unfortunately, the Biden administration and progressive Democrats in Congress do not support investment policies such as hedge funds. Instead they prefer to demonize capitalism and Wall Street.   

In North Carolina alone, $23 billion is invested in hedge funds from investors such as universities, foundations and retirement plans. Some of our most notable universities operate endowments dependent on hedge fund investments that support a combined total of over 267,000 students. These investments also help keep tuition down and provide financial aid through scholarships.  

Another positive benefit of investments in hedge funds is our retirement systems and benefits offered for hard-working Americans. The North Carolina Department of State Treasurer invests $3.9 billion in hedge funds to cover 1.14 million plan participants. This investment will cover necessary benefits for the current 1.14 million people enrolled once they retire. Universities and retirement plans rely on these returns on investments in hedge funds to help everyday people who are essential to offering scholarships and retirement benefits for North Carolinians.  

Not only do we see universities investing in hedge funds, many nonprofits and charities also invest in hedge funds to help rural communities and those in need. The Golden LEAF foundation invests $346 million in hedge funds on behalf of rural communities to help them with economic development initiatives. Novant Health invests $420 million in hedge funds. Many nonprofits struggle with funding, so they rely heavily on the return on investments in hedge funds to continue their good work to help people and communities in need. 

It is my hope that all of our lawmakers will understand how essential investments in hedge funds are for financial security here in North Carolina and across the country. I trust lawmakers will embrace what needs to be done to make sure North Carolina and all those who benefit from hedge funds have a positive future instead of putting up more barriers.  

Frank Grainger is the CEO of Fair Products.