The Yale University endowment has reduced its allocation target for private equity to 31 per cent for 2014 from 35 per cent previously.
In a recent update, Yale said its endowment made an investment return of 12.5 per cent in the year to the end of June. Its value increased to $20.8bn from $19.3bn a year earlier.
Investments gains and distributions reached $2.3bn and $1bn respectively.
Yale noted that its endowment posted an average annual return of 11 per cent over the past ten years, while domestic stocks and bonds returns 8.1 and 4.5 per cent annually.
The endowment’s private equity investments returned 14.4 per cent per annum during the ten year period.
While lowering the private equity target by four per cent, the endowment also reduced the allocation target for real estate to 19 per cent from 22 per cent. Meanwhile, the targets for absolute return and foreign equity were lifted to 20 per cent from 18 per cent and to 11 per cent from eight per cent, respectively.
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