Returns with Resilience: The Role of Alternative Assets in the INSEAD Endowment

This case examines the evolution of the investment strategy of the INSEAD endowment, focusing on the role of alternative assets in generating long-term returns while maintaining portfolio resilience. It traces the endowment’s adoption and adaptation of the Yale Endowment Model, highlighting key decisions related to asset allocation, risk management, and manager selection. Set against a backdrop of changing market conditions, declining private equity outperformance, and increasing portfolio complexity, the case explores the continued role of private equity within the endowment’s portfolio. Students are challenged to evaluate the tradeoffs among return, liquidity, risk, and governance considerations, and to determine an appropriate investment strategy aligned with the endowment’s long-term objectives.

This case enables students to develop a deeper understanding of institutional investment strategy, with particular emphasis on the role of alternative assets in achieving long-term returns while maintaining portfolio resilience. Students examine the principles underlying endowment investing and analyze how asset allocation, risk management, and manager selection influence investment performance. The case encourages critical evaluation of the role of private equity in institutional portfolios, particularly in light of changing market conditions and questions about its ability to deliver sustained outperformance. Through discussion and analysis, students assess the tradeoffs among return, liquidity, risk, governance, and portfolio complexity, and consider how investment strategies should be aligned with an institution’s long-term objectives, liquidity needs, and organizational capabilities.