WashU's endowment allocation is 45% private markets and one-third public equities
Scott Wilson · Scott Wilson – Concentrated Investing at Washington University-St. Louis (Capital Allocators, EP. 159) · Oct 5, 2020 · at 33:11
Scott Wilson, CIO of Washington University in St. Louis, outlines the endowment's top-down asset allocation breakdown across privates, public equities, real assets, and hedge funds.
0:00 / 0:24exact quote · 24.4s
720p mp4 · rendered on demand · StarZero watermark
“If you think we're roughly a third public equities, which bounces around, we're probably a little bit overweighted in privates. That's probably 45% of the portfolio today, just because privates, particularly venture and growth equities had such a big run. And then we have five to 10% of the portfolio and real assets type exposure, another 10% in hedge funds, and the balance would just be cash.”
quote is from the automated transcript, cleaned for reading: filler sounds and stutters are removed, nothing is rephrased. names can be misheard (the analysis reads context, assessments check outside sources). how →
More from Scott Wilson
Wilson redeemed nearly half of WashU's endowment in his first weeks
“We put in redemptions for almost half the portfolio in the first several weeks.”
WashU turned over 80% of its legacy endowment portfolio in three years
“At this point, I think we've probably turned over. 70, 80% of the original pool, even more than 80%, actually. So the vast majority of it's been turned over and those we've kept, we've added capital to and concentrated exposures.”
Multi-manager hedge funds act as expensive index funds guaranteeing underperformance
“Because essentially you're an index fund on both sides of the market with an expensive active management fee structure on top of it. And the fee structure is problematic in that it guarantees you always do worse than the average, right? So you're essentially i…”
WashU drove strong returns buying Russian tech at 5x earnings multiples
“Russia, we've made quite a bit of money in some of the more tech based companies that would trade it. 20 times revenue in the U S that are trading at five times earnings in Russia, growing in return on equity of 60% plus growing at 30, 40% right through COVID …”
WashU's top 100 look-through positions constitute over one-third of the portfolio
“If you looked at our top hundred positions, that's going to be probably a third of the portfolio and maybe even slightly more than that currently, just because we've had such a big run in some of those names”
Traditional allocators require years of mentoring to adapt to direct underwriting
“I don't think someone who comes from a traditional allocator background and grew up in that world, it takes, I think, several years of learning and mentoring before they're comfortable with this kind of investment style.”