Qubit: Charley Ellis on David Swensen's Investment Approach
According to Charley Ellis, former member of the Investment Committee at Yale, this was David Swensen’s investment approach:
Be disciplined
Anoint up-and-coming fund managers
“Another part is--David's whole approach is best characterized as disciplined. It's very creative, but it's also very disciplined. And the discipline requires extra efforts and due diligence that most people would imagine putting in, more rigor on what are your screening criteria and policies than most people could believe would be appropriate or useful, and tougher discipline with an investment manager when Yale is getting to the position of choosing to work with that investment manager.”
“So, scuttlebutt network, David Swensen’s got far and away the world's best, and it vibrates. And he gets most of his suggestions for possible new investment managers from current investment managers who say, ‘David, I hear that so and so and so and so might be getting together to start a new firm.’ David very often sits down in the kitchen with them and works out how they're going to design that new firm to be sure it's very, very successful. And if he gets his confidence level in them really high, he'll then be a founding investor and sometimes a very large founding investor.”
Source:
Charley Ellis: Why Active Investing Is Still a Loser's Game
Tweets and Posts:
Qubits are insights that we find and share with you.