State panel ponders role in investments (The Oregonian)
When I read this article, the first thing that came to mind was that this is exactly the reason many institutions rely on fund-of-funds to deal with the time consuming due diligence associated with private equity investing.
Since Jan. 1, high-flying and expensively clad masters of the private-equity universe have flown out to Or-e-gone, made 15-minute presentations to the six locals charged with husbanding the public-employee nest egg, and flown home with commitments for investments of $2.6 billion.
...But with a steady flow of new private-equity deals, the council has spent 70 percent of its meetings discussing an asset class that represents only 15 percent of its $68 billion portfolio, said Richard Solomon, the council chairman and Portland accountant.
In the end, the council voted unanimously to turn over more investment authority to staff.
posted by Robert Stankavish @ 9:42 AM
2 comments
2 Comments:
Working in the alternative investment industry I've seen a huge push lately from smaller colleges looking to get in to the hedge fund/pe side of investing. Essentially, many mid-size endowments and pension plans have caught on to what David Swensen and Jack Meyer have taught for years: diversification across asset classes and managers (esp. with a hedging aspect) can lower the volatility of returns and hopefully increase them in the long run.
Plus, with many hedge funds now moving towards registration they are now being looked at more carefully by institutional investors like endowments - whereas before the secrecy of their returns/exposures may have kept them away.
Thanks for your comments Alex. This trend should bode well for fund-of-funds since small colleges have even fewer resources dedicated to investment management. In addition to fewer resources, they also have a smaller pool of money that presents additional investment challenges. I believe Investure in Charlottesville has a focus on pooling assets from smaller colleges.
Post a Comment
<< Home