Yeah, I heard Swensen has a new book out. He attempted to write a book on how us "regulars" can invest like an endowment, but as he sat down to write it, his conclusion was we can't.
Interesting op-ed piece on the yale endowment from nytimes:
 Quote:
Yale has an endowment of something approaching $13 billion. Under the stewardship of its top-flight investment manager, David F. Swensen, it has compounded recently at the rate of very roughly 20 percent a year.
The Yale endowment can grow at this astounding rate partly because of the stock-picking prowess of Mr. Swensen's team. That prowess is obviously formidable - although, based on what I read by and about him, it is not unusual or exotic. But the endowment can compound at that rate mostly because its immense size allows it to invest in great things called private-equity deals. In this type of investment, the managers of a company buy it away from its stockholders, or outsiders buy it from its owners and then restructure it.
There are staggering profits to be made in these deals - sometimes losses, too. But in a well-thought-out deal, private-equity investors buy a company with a thin little slice of equity - maybe 10 percent - and a lot of debt. If the company can be spruced up and resold a few years later (or many years later) for four times the purchase price, that original investment has suddenly (or gradually) grown by a multiple of 30 because all of the gain goes to the investors who put up only 10 percent of the purchase price.
This is the best business in America - by far - and it is run by very brilliant men and women. People like me, even with seven figures to invest, cannot come near these deals. Big players like university endowments and very rich family funds get in on them all the time. Again, these deals account for a large part of Yale's spectacular endowment growth.
Another major source of Yale's great gains is their tax-free status. Its endowment managers can trade rapidly in hedge funds without paying the short-term capital gains rates that we peons pay. This gives them a big advantage over most investors. If it were taken away, I wonder what the endowment's return on investments would be in stock or commodities trading.
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