endowments

Harvard and Yale Are No Match for the Bears

“…how was it possible for so many endowments to make bad choices among private equity and venture capital funds? The following chart from Markov suggests that it is down to outlandishly wide variations in performance within the private equity/venture capital world,” writes John Authers about MPI’s research in his opinion piece on Bloomberg.

If the Ivy League Can’t Get This Right, Who Can?

“Last year was a great one for private equity and venture capital, but Ivy League endowments, with their huge allocations to alternative investments, didn’t all benefit, according to MPI.,” writes Julie Segal about MPI’s research in her article in Institutional Investor. 

Outsmarted: Why investor brainiacs couldn’t beat the market over the past decade

Ian McGugan, investing columnist at Canada’s premier daily Globe & Mail wrote a column reviewing the decade and discussing why beta was so hard to beat has a prominent mention of the Ivy endowments’ failure to beat a 60/40 portfolio and MPI’s research.

A College Investor Who Beats the Ivys

“Bowdoin posted an 8.8 percent average annual return over the 10 years that ended June 30, handily beating the 6 percent average for all college endowments with assets of more than $1 billion, according to a national study. The school also outperformed all eight Ivy League endowments, none of which managed to beat the 8.1 percent average annual performance of a plain vanilla portfolio consisting of stock and bond indexes, according to Markov Processes International, a research firm.” Read the full article here. (subscription required)

Broken Trust, Texas’ huge school endowment pays out less and less for school children

“One way to look at a fund’s performance is by its growth in market value. Another way is to examine its returns. Analysts at Markov Processes International, a global investment research and technology firm, estimated that the fund was performing comparable to the worst-performing Ivy League endowments. One hundred dollars invested in the top-performing Ivy League endowments about a decade ago would be worth roughly $250 now. The Ivy average came in at about $220. The same cash put in the Permanent School Fund would now be valued at about $190. Read the full article here.

Bad Manager Picks Have Sunk Pensions’ Bet on Alts

“Public pension funds aren’t the only institutions to fail to benefit from the heady promise of alternatives. The performance of Ivy League endowments has trailed a passive portfolio of 60 percent U.S. stocks and 40 percent bonds over the past ten years — and has been more volatile to boot, according to a report from research and analytics provider Markov Processes International.” Read the full article here.

A Fine Balance Leads to Successful Long-Term Investing

In the 1990s, it pioneered a strategy that has since become the preferred approach for the endowments of many of the continent’s top universities and foundations. The Yale model consists of pouring money into opportunities that aren’t as thoroughly picked over as public stock and bond markets–areas such as timberland, hedge funds and private-equity deals. In theory, this makes sense. Investors should derive a reward for taking on the additional work and risk that goes along with venturing into the dimmer corners of the financial markets. But in practice the Yale model has been inconsistent. It beat a 60/40 approach during its early years; more recently, it’s looked strictly ho-hum. In fact, over the past 10 years, the endowments for Yale and all the other Ivy League schools in the United States failed to match the performance of a standard 60/40 portfolio, according to a recent study by (MPI), an investment research and software firm. Read the full article here. (subscription required)

Why the Ivy League Clings to a Strategy of Diminishing Returns

“With $136 billion in assets and enviable access to exclusive investment opportunities, Ivy League universities have long boasted that their endowments earn higher returns than other investors. Not anymore. This year the 10-year returns achieved by the endowments for all the Ivy League schools lagged a plain-vanilla portfolio of stocks and bonds, according to a new study by Markov Processes International, which closely monitors the performance of Ivy League endowments. It’s the first time that has happened in the 16 years for which Markov has data on all the Ivy League endowments.” Read the full article here. (subscription required)

Ivy League Endowments Lag 60-40 Portfolio

“Despite reporting strong returns for the second straight year, Ivy League university endowments have lagged behind a simple portfolio comprised of 60% stocks and 40% bonds over the past 10 years, according to a report from Markov Processes International. The report said that from fiscal year 2009 to 2018, a portfolio made up of 60% stocks and 40% fixed income had annualized returns of 8.1%. Meanwhile not even the top-performing Ivy League endowments beat this over the same time period as Columbia University and Princeton University’s endowments were a shade behind with annualized returns of 8.0% each.” Read the full article here.