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Endowment model. This model is characterized as an active management approach with higher allocation to alternative investments and lower allocation to the public equity and fixed income. The investments are outsourced.
The advantage is the better upside and investment return. The disadvantages are 1) alternative investment typically requires large amount of investment, 2) the funds invested in alternatives will be hard to liquidate, 3) difficult to implement: for smaller funds, who may not have access to top-tier private asset managers. For large funds, their footprints are large. 4) expensive in fees and costs.