Outperform : Inside the Investment Strategy of Billion Dollar Endowments

by Baschab, John; Piot, Jon

• ISBN13: 9780470442135
• ISBN10: 0470442131
• Format: Hardcover
• Copyright: 2010-08-09
• Publisher: Wiley

Summary

"University endowment managers have generally outperformed themarket benchmarks. However, their knowledge has not been well documented inany book. This book fills that gap and should be of significant help to all those who want to learn from extensive interviews with a number of endowment managers." -Prem JainMcDonough Professor of Accounting and Finance, Georgetown UniversityLearn how higher education's largest endowments consistentlyachieve higher investment returns than the overall market.The Chief Investment Officers who oversee the top academic endowment fundsmanage over $400 billion in total assets. Over the last ten years (1999-2009), large endowments returned an average of 6.1%, compared to the S&P 500 indexaverage of -2.22%, an outperformance difference of over 8%. With the recentsharp economic downturn, and a decade of inflation-adjusted flat returns in theoverall equities market, institutional and individual investors alike are looking to endowments for proven strategies for improving the performance of their portfolios. Outperform: Inside the Investment Strategy of Billion Dollar Endowments interviews top CIOs from leading endowments, to detail how they consistently outperform the market, what they predict for the coming years, and how small investors can employ their investment philosophies.

Author Biography

JOHN BASCHAB is Senior Vice President at Technisource, a leading business services company and a division of SFN Group. He was a cofounder and president of consulting services at Impact Innovations Group before successfully selling the company to Technisource in 2005. After receiving his MBA with honors from the University of Chicago Booth School of Business, Baschab worked as a technology consultant to Fortune 500 companies in the Chicago office of management consultancy Booz & Company. He began his career at AT&T following graduation from the University of Alabama. John is an adjunct professor at Southern Methodist University.

JON PIOT received a bachelor of science from Southern Methodist University and an MBA from Harvard Business School. He began his career at Andersen Consulting (now Accenture) and provided consulting services to Fortune 500 companies at management consultancy Booz-Allen Hamilton. As co-founder and CEO of Impact Innovations Group, Jon led the sale of Impact Innovations to Technisource in 2005 and was part of the executive team responsible for the sale of Technisource to Spherion Corp. He is currently the managing partner at Redpoint Capital, a private equity investment group, and an adjunct professor at Southern Methodist University.

Table of Contents

Preface	p. ix
Acknowledgments	p. xiii
Academic Endowments
Academic Endowments Overview	p. 3
The World of Endowments	p. 4
History of Endowments	p. 6
Academic Endowments in the Context of the Investment World	p. 7
Large Academic Endowments	p. 7
Implications for Individual Investors	p. 17
Summary	p. 19
Notes	p. 20
Historical Endowment Performance	p. 21
Investment Returns	p. 22
Asset Allocation	p. 28
Summary	p. 30
Notes	p. 31
A Look Inside Endowments	p. 33
Endowments are Different	p. 33
Endowments Define Asset Classes Broadly	p. 35
Endowments Achieved a One-time Sophistication Improvement	p. 36
Endowments are Nimble	p. 36
Endowments are Evaluating Approaches to Managing Tail Risk	p. 37
Endowments also Manage Working Capital	p. 38
Endowments Manage Liquidity Carefully	p. 39
Endowments are Changing their Approach to Performance Measurement	p. 41
Summary	p. 41
Public Universities
Jonathan Hook, Chief Investment Officer The Ohio State University	p. 45
Guy Patton, President and CEO The University of Oklahoma Foundation	p. 57
Bruce Zimmerman, Chief Investment Officer University of Texas Investment Management Company	p. 69
Private Universities
James H.C. Walsh, Chief Investment Officer Cornell University	p. 81
Sally J. Staley, Chief Investment Officer, and Anjum Hussain, Director of Risk Management Case Western Reserve University	p. 95
Mary Cahill, Vice President of Investments and Chief Investment Officer Emory University	p. 113
Don Lindsey, Chief Investment Officer George Washington University	p. 125
Scott W. Wise, President Rice Management Company	p. 141
James (Jim) Hille, Chief Investment Officer Texas Christian University	p. 153
Jeremy Crigler, Chief Investment Officer Tulane University	p. 167
Advisors and Managers
Sandy Urie, President and Chief Executive Officer, and Celia Dallas, Co-Director of Research and Managing Director Cambridge Associates	p. 181
Lyn Hutton, Chief Investment Officer Commonfund	p. 199
Thruston Morton, CEO and Chief Investment Officer Global Endowment Management	p. 217
Mark W. Yusko, CEO and Chief Investment Officer Morgan Creek Capital Management	p. 231
Rafe de la Gueronniere, Principal New Providence Asset Management	p. 247
Bob Boldt, Chief Executive Officer Boldt Ventures	p. 267
Conclusion Concepts for Individual Investors	p. 281
Lessons for Individual Investors	p. 281
Trends	p. 288
Predictions for Endowments	p. 292
Summary	p. 294
Glossary	p. 297
About the Authors	p. 307
Index	p. 309
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