Yale Boosts Private Equity, Cuts Hedge Funds

Mar 22 2010 | 2:06pm ET

One of the biggest hedge fund investors in the U.S. is cutting back on the asset class.

Yale University’s $16.3 billion endowment has reduced its hedge fund allocation from 21% to 15% to fund increases in its private equity and real estate and commodities portfolios. The former, Yale’s best performing asset class over the past decade, will rise from 21% to 26%, while the latter will be increased from 29% to 37% of the endowment’s assets.

“Alternative assets, by their very nature, tend to be less efficiently priced than traditional marketable securities, providing an opportunity to exploit market inefficiencies through active management,” the school wrote in a report released last week. “The endowment's long-time horizon is well-suited to exploiting illiquid, less-efficient markets such as venture capital, leveraged buyouts, oil and gas, timber and real estate.”

Yale made the allocation changes at its June 2009 investment committee meeting.


In Depth

Humble in Hofstra...One Debate an Election Can Make

Sep 26 2016 | 10:20am ET

Tonight's U.S. Presidential debate, infamously coined the “Humbling in Hofstra...

Lifestyle

Vortic: Reimagining the Custom Wristwatch

Sep 27 2016 | 7:24pm ET

American watch manufacturer Vortic, which started out restoring antique pocket watch...

Guest Contributor

Malik: The Ever-Changing Middle Market and The Entering Class of 2016

Sep 2 2016 | 5:01pm ET

Deal sourcing and origination is only going to get more competitive given current...