Investing in Your Alumni: Endowments' Investment Choices in Private Equity
Journal
Journal of Financial Services Research
ISSN
0920-8550
1573-0735
Type
journal article
Date Issued
2023-11
Author(s)
Abstract
We investigate the role of alumni ties in university endowments' decision to invest into private equity funds. Based on a sample of 1,590 commitments made by 189 U.S. endowments into 613 funds during the period of 1995 to 2017, we show that endowments are more likely to invest into funds that are managed by the alumni of their own alma mater. This finding is more pronounced for less prestigious and less private equity experienced university endowments. Thus, our results are not only dominated by institutions with a larger proportion of active alumni in the private equity industry. Furthermore, we observe that alumni ties are not associated with better performance compared to other endowment investments where such a tie does not exist.
Language
English
Keywords
Alumni ties · Fund managers · Investment choice · Private equity · University endowment
HSG Classification
contribution to scientific community
Refereed
Yes
Number
November 2023
Contact Email Address
roland.fuess@unisg.ch
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