asset allocation and great manager selection is a winning combo!

There is a huge difference between having high valuations on paper versus actual distributions of cash or public stock.

If your portfolio returns are based on the former, the illiquidity risk is real.

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"We are seeing the continuation of a multi-year trend in which private assets (and their strong performance) appear to act as the primary driver for UPenn’s performance. At $20.5B, UPenn is well-diversified both in public and private assets, leaving very little 'credit' to individual manager selection ('Selection' item in charts above) – despite the extremely wide distribution of PE results year-by-year. This could be an important piece of news for the UPenn endowment team as they chart their future allocations. As new data will come in it would be interesting to see whether we will have an outlier like Brown last year or this will be the Year of Diversification with asset allocation determining all Ivies 'to a T.'

As we examine each endowment’s results, we’ll be watching for the effect private equity and venture capital have had across the space, and to see how endowments deal in future with the increase in real portfolio risk that comes from growth of both illiquid assets and equity sleeves – natural results of the exceptionally strong performance of these asset classes in FY21."

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Private Equity returned 59% for FY 2021 at Penn's endowment:

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