David Swensen

Pioneer of institutional investing, creator of the "Yale Model" for endowment management

48 principlesInstitutional InvestingUSABorn 1954

"Asset allocation is the most important tool an investor has."

About David Swensen

David Frederick Swensen (January 26, 1954 – May 5, 2021) was an American investor and the chief investment officer at Yale University from 1985 until his death. He transformed Yale's endowment from $1 billion to over $31 billion, achieving an average annual return of 13.7% over his tenure. Swensen pioneered the "Yale Model" of institutional investing, which emphasizes diversification across asset classes, particularly alternative investments like private equity, venture capital, real estate, and natural resources. This approach revolutionized how university endowments and other institutional investors allocate capital. His investment philosophy centered on equity-oriented, diversified portfolios with a long time horizon. Swensen believed that institutional investors with long-term mandates should embrace illiquidity in exchange for higher expected returns, a key insight that drove Yale's exceptional performance. Beyond his investment success, Swensen mentored numerous investment professionals who went on to manage other major endowments and institutional portfolios. His books have become required reading for institutional investors worldwide.

Investment StyleInstitutional Investing, Alternative Assets, Diversification, Long-term Orientation

Key PhilosophyYale Model, Asset Allocation, Illiquidity Premium, Manager Selection, Equity Orientation

Notable HoldingsYale Endowment (Private Equity, Real Assets, Hedge Funds, Domestic Equity, Foreign Equity, Fixed Income)

Books & WritingsPioneering Portfolio Management, Unconventional Success