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Matthias Knab, Opalesque:

Gary Mishuris, Managing Partner and CIO of Silver Ring Value Partners, writes on Harvest Exchange:

The Yale Endowment, led by its CIO David Swensen, is legendary for its independent thinking and superior long-term results. The 2016 endowment report makes a strong case for why active management is the right choice for the Endowment, why alignment with managers is extremely important, and why net returns, not fee minimization, should be the primary objective.

The Yale Endowment believes that active management is right for it, but not for the majority of other endowments and foundations

Excerpted from page 18 of the 2016 Yale Endowment report:

Instead of paying fees to active managers, Yale could invest in low-cost passive index strategies. Such strategies make sense for organizations lacking the resources and capabilities to pursue successful active management programs, a group that arguably includes a substantial majority of endowments and foundations. However, Yale has demonstrated its ability to identify top-tier active managers that consistently generate better-than-market returns, after considering performance fees. Yale's returns net of fees are superior to the returns of the low-cost index-tracking vehicles.

Yale is right to defend its choice to invest with top......................

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