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Pioneering Portfolio Management: An Unconventional Approach to Institutional Investment

4.17  ·  Rating details ·  887 ratings  ·  33 reviews
In his 14 years as Yale's chief investment officer, David Swensen has propelled the university's investment portfolio into the top one per cent of institutional funds. Here, he articulates his philosophy and strategies of portfolio management. ...more
Hardcover, 366 pages
Published May 22nd 2000 by Free Press (first published May 15th 2000)
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Average rating 4.17  · 
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 ·  887 ratings  ·  33 reviews


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Jeff Garrison
Feb 16, 2016 rated it really liked it  ·  review of another edition
Favorite quote from the book: “[S]uccssful investment cultures encourage professionals to find new mistakes to make, instead of simply repeating old errors.†(page 304)


Originally published in 2000, Swensen updated his classic work on institutional investments early this year. Swensen’s writing is very systematic, which can be expected from the Chief Investment Officer for Yale University. He begins by exploring the reasons for endowments and the necessity of an appropriate polices for spend
...more
Kevin
Nov 26, 2014 rated it really liked it  ·  review of another edition
This is a book detailing many strategies that can be employed with endowment and pension management as well as describing which are often or sometimes the best fit for a situation. I thought it overall was a pretty good book, but the writing style left a little to be desired. It was about as engaging as a textbook.
Regarding endowments, I thought his comments regarding the time frame for it was interesting. Is it intended to last forever, or is it intended on having a set lifetime? Also, is the
...more
Jeff Garrison
Jan 19, 2019 rated it liked it
Shelves: business-finance
Favorite quote from the book: “[S]uccssful investment cultures encourage professionals to find new mistakes to make, instead of simply repeating old errors.” (page 304)

Originally published in 2000, Swensen updated his classic work on institutional investments early this year. Swensen’s writing is systematic, which should be expected from the Chief Investment Officer at Yale University. He begins by exploring the reasons for endowments and the necessity of appropriate polices for spending and inv
...more
Alex
Mar 11, 2020 rated it liked it  ·  review of another edition
This book reads like an college financial studies textbook, very dry and colorless. I would recommend this to anyone working directly in the field of finance or active fund management. However, for the rest of us investors, the content is a bit much. There is a good amount of time dedicated to the specifics of running a large endowment, including how to treat fund managers, reviewing past endowments, and other specific things that do not apply to the every day investor.

If you want an overview o
...more
Tyson Strauser
Mar 01, 2010 rated it liked it
Swensen's views on asset allocation are a useful check against an investment view of specific investments within an asset class. The best lesson I learned from this book was the importance of asset allocation in addition to great investment idea generation. ...more
Akhil Jain
Apr 14, 2018 rated it really liked it
My fav quotes (not a review):-Page 11 |"The sixth secret is that, as Charles Darwin tried to explain, survival of the fittest is not determined by competitive strength, but rather by social desirability. There’s more money than certified talent in the world of investing, so outstanding investment managers have many choices because so many investors want to be their clients. Given their freedom of choice, managers prefer to work for and with clients they like and admire, and they like and admire ...more
John Mcdonnell
Jan 01, 2020 rated it really liked it
Swensen's book ranges from a dry, almost textbook-like description of the mechanics of portfolio assembly to gory war stories of greed and mismanagement. It's actually fairly clear to see the principles that should (in principle) underlie one's own personal portfolio allocation decisions, while also providing insight into the eagle's eye view institutional investors take when making their decisions.

The single most useful thing I learned is that active management really can work, at least if you'
...more
Henry Barry
Mar 17, 2018 rated it really liked it
Overall very solid book. You may find less value in it if you have no experience or education in asset management, but he does a nice job summing up basics of asset classes and the typical pitfalls faced by many institutional investors. I found his descriptions of the incentive structures of small vs large managers, and of his claim that all fixed income other than treasuries is “impure fixed income” particularly fascinating.
Mark Zodda
Some very interesting insights in this book though I am not the intended audience. Those financial professionals who deal with institutional investments will probably rate this book one or two stars higher than I did. I still found it to be worthwhile reading and am glad to have picked it up. I might now look at reading his book for individual investors, "Unconventional Success: A Fundamental Approach to Personal Investment." ...more
Ning
Dec 03, 2018 rated it really liked it  ·  review of another edition
Shelves: investing
This book is very insightful and the author proposed some practical problems in the asset management industry. It is very helpful, not only for beginners but also for experienced investment professionals.
This book is definitely worthwhile to be read again.
KevinLee
Jul 18, 2018 rated it it was amazing
Shelves: investment
It's a great book! Swensen taught me how to do investment in the right way. ...more
Keven Wang
Apr 19, 2021 rated it it was amazing  ·  review of another edition
Great insights into how institutional investors think
Dawei Liu
Mar 28, 2020 rated it really liked it
Pioneering Portfolio Management is probably considered the closest thing to a textbook one could find in the field of Investment Management. Dave Swensen is a modern legend and though he might not admit it, the forefather of the dominant investment style found in endowments, foundations, and family offices around the world. Much of what Mr. Swensen details in this book are still quite relevant I found the writing style quite easy to read. While he doesn’t dive too deep into the weeds, or go into ...more
Danielle
Jan 12, 2020 rated it really liked it
It's a bit dry. The big takeaway is to customize to your institution's needs. People mistakenly think that they can just take this and apply it to a smaller endowment or one with different budgetary restrictions and goals. This is not a turnkey solution but provides solid guideposts. ...more
J.T.
Jul 08, 2019 rated it it was ok
Shelves: work, finance
Decent book to increase overall financial acumen but found the flow hard to follow. The book title says it's for institutional investment but at times Swensen seems to go off into the retail/individual space. ...more
Sean
Nov 07, 2013 rated it really liked it
This book lays out fundamentals of portfolio management from the perspective of one of the most successful and credible practitioners in the market: David Swensen of Yale's Endowment. Swensen discusses the three tools of portfolio management: 1) asset allocation -- responsible for ~90% of portfolio returns 2) market timing -- mostly a fool's game, and 3) security selection -- contingently appropriate dependent on the strategy and time horizon. Swensen advises appropriately to maintain an equity ...more
Roman Schuster
Nov 13, 2018 rated it really liked it  ·  review of another edition
Very illuminating book - it gave a great macro overview of how university endowments should think about their portfolios, in terms of balancing the decisions of what percent of the endowment should be spent each year versus what the portfolio should be invested in to ensure preservation of purchasing power. It made me consider macro risks I had never thought about before and suggested ways to hedge them. It was also full of blow-up stories. He spent a full two pages running Jim Cramer through th ...more
JimmiD
Jan 17, 2019 rated it it was amazing  ·  review of another edition
An excellent reference manual. First chapter is really the most important.

What my ratings mean:
5 – I felt this book was an exemplar in its genre/field. That does not mean I agree with everything it says (or the moral of the story). It is likely to be a book that will change my thinking about a topic.
4 – A very impressive book for its genre/field. It probably didn’t change me or my thinking though.
3 – An enjoyable way to spend the time reading it.
2 – This was a pain to read. It was probably diff
...more
Joseph Stec
Jul 30, 2010 rated it it was ok
kind of basic and boring, doesnt say anything novel or give any real insightful ideas. however, the various stories and examples of other funds he tells are really interesting. i would rather read a sort of "tell all" kind of book from him (or just as good, this same book written today, after their endowment fund debacles of the past few years).

dude is also in love with keynes, which in turn makes me question everything written in the book, including things i already agreed with.
...more
Michael Berges
First half is very good explanation of diversified investing and asset allocation. Second half gets very wonkish and he kind of starts speaking out of both sides of the mouth. The appendix is all about fixed income but isn't considered an actual chapter, which seemed very strange. ...more
Mark
Mar 01, 2008 rated it liked it
Hard to knock the "Father" of portfolio management. I just thought it was a little elementary. I was expecting a little more advanced portfolio theory. ...more
John Reeves
Jun 10, 2008 rated it it was amazing
Every Fool should read this book. He's probably more skeptical than most of us when it comes to whether most folks can outperform the market or not. But that's probably a good thing. ...more
Yuko
Jun 20, 2008 rated it it was amazing
Great starter book for anyone getting into indirect fund investing.
Peter
Aug 19, 2012 rated it it was amazing
Pretty repetitive but generally interesting and good fundemental approach to investment and different asset classes.
Bart Kramer
Sep 16, 2012 rated it it was amazing
Great book on portfolio management
Peter Keilman
Dec 28, 2012 rated it really liked it  ·  review of another edition
This is valuable for understanding how strong portfolio managers think about various types of alternative investing. Recommended for its contrarian view, especially around fixed-income investing.
John
Aug 26, 2013 rated it liked it  ·  review of another edition
Shelves: john, already-have
I found The Four Pillars of Investing by Bernstein a better read. This book repeats itself so often that 100 pages could be trimmed easily from it.
Chris
Mar 13, 2013 rated it it was amazing  ·  review of another edition
A must read for all investors.
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David F. Swensen (born 1954) has been the Chief Investment Officer at Yale University since 1985. He is responsible for managing and investing the University's endowment assets and investment funds, which total $23.9 billion. Realizing an average annual return of 11.8 percent on his investments over the ten years to 2009, Swensen's consistent track record has attracted the notice of Wall Street po ...more

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“most important distinction in the investment world does not separate individuals and institutions; the most important distinction divides those investors with the ability to make high quality active management decisions from those investors without active management expertise. Few institutions and even fewer individuals exhibit the ability and commit the resources to produce risk-adjusted excess returns.” 1 likes
“John Maynard Keynes criticized fiduciaries for preferring to “fail conventionally” rather than taking, as Swensen so often does, direct responsibility for independent, even pioneering thought and action.” 0 likes
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