Yale Keeps Yale Endowment Model

private equity

Yale’s massive US$ 23.9 billion endowment gained US$ 4 billion in investment returns during its fiscal year 2014 – essentially a 20.2% return. The big threat facing U.S. endowments is sustainable funding and Yale’s endowment for 2014 subsidized nearly 33% of the university’s income. The world of asset allocation models and theories are rife with contentious debates. Yale’s endowment model has accumulated both admirers and haters. Pioneered and led by Yale’s Chief Investment Officer David Swensen, the endowment is heavily allocated to nontraditional assets. These unlisted assets include venture capital, leveraged buyouts, natural resources and institutional real estate.

Asset Allocation – June 30, 2014

Asset Class Weight
Absolute Return 17.4%
Domestic Equity 3.9%
Fixed Income 4.9%
Foreign Equity 11.5%
Natural Resources 8.2%
Private Equity 33.0%
Real Estate 17.6%
Cash 3.5%

 

How Long Will It Last?

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