Analysis of Yale’s Asset Allocation 2017

Yale reported its 2017 performance (11.3%) and target allocation for 2017. The performance of the fiscal year 2017 was not as strong as its peers, but Yale’s long-term outperformance is still unbeatable. (source: YaleNews, Yale Investment Office)

Through June 2017

More Absolute Return (Hedge Funds); Less Real Estate

• This is continuation of Yale’s asset allocation trend over the last 6–7 years
• Note that Yale is not a good real estate investor — their performance is not as strong as other investments

Private Equity Allocation Unchanged

• The contrast between Private Equity and Absolute Return is obvious
• Given strong performance of Private Equity, I believe Yale is taking profits from existing investments and not proactively adding to the new opportunities

More Venture Capital and Less Leverage Buyout

• The increase of allocation is partially due to the increased value of underlying invetments in Venture Capital

Other Notable Changes

• Continuing reducing exposures to Real Assets (primarily Real Estate)
• Doubling exposures to Foreign Equity over the last 6 years (mainly through Emerging Markets)
• Maintaining relatively high cash and fixed income balance (better opportunities in the future?)