Yale SOM Receives Major Gift to Launch Swensen Asset Management Institute
The new academic center will further the study and practice of asset management by supporting research, convening thought leaders, and funding scholarships for students.
The Yale School of Management has established the Swensen Asset Management Institute with the support of a $20 million gift from an anonymous donor and has appointed Tobias J. Moskowitz the institute’s inaugural director. The new institute is named for David F. Swensen ’80 Ph.D., the longtime Yale chief investment officer whose investment performance became a byword for excellence guided by a set of values, ethical rigor, and a sense of purpose. The Swensen Institute will build on that legacy of principled investment and strengthen SOM’s mission of educating leaders for business and society. This cornerstone gift is among the most significant the school has received.
Kerwin K. Charles, the Indra K. Nooyi Dean and Frederic D. Wolfe Professor of Economics, Policy, and Management, said the new Swensen Institute reflects the school’s founding principles. “Asset management is a field where financial and societal interests are inseparably intertwined. Skillful investment managers further all kinds of social goals—including fortifying university endowments, ensuring the strength of the funds that support individuals in retirement, and allocating capital to high-impact, high-growth businesses. The Swensen Institute will build on SOM’s tradition of phenomenal academic work in the area of finance and further amplify our ability to impact this critical field by demonstrating how effective, principled, and values-based asset management serves both business and society.”
In addition to creating an endowment fund to support the Swensen Institute’s activities and its directorship, this gift will enable the creation of a new endowed professorship, additional scholarship funding, and innovative programming aimed at enhancing the practice of asset management. All of the Swensen Institute’s activities will augment the success of existing SOM programs in the field, including the Master’s Degree in Asset Management and the Asset Management area of focus within the MBA for Executives. The institute will benefit students across the school as they build their professional knowledge and seek internship and full-time positions.
A scholarship fund created under the gift will help the school provide financial support to students in the Master’s in Asset Management program. Meghan McMahon, David Swensen’s widow, said, “The students in this master’s program represent all that David had hoped for as he worked to create both the program and the curriculum. David was firmly committed to increasing opportunities in the financial sector for women, underrepresented groups, and first-generation students.”
The Swensen Institute will catalyze both scholarly inquiry and professional engagement around the big questions in the field of asset management. By disseminating new research and findings through activities such as conferences and colloquia, helping industry solve problems, and incorporating new tools and ideas into the school’s curriculum, the Swensen Institute will aim to have a broad, positive impact on society.
Yale University President Peter Salovey noted that Swensen provided a fitting model for programs that will train future investors. “David Swensen transformed the way Yale managed its endowment and completely changed the field of institutional investing. A visionary leader, his life’s work demonstrated how investment acumen can vastly augment the financial resources available to institutions and produce wide-ranging benefits for all sectors of society. The Swensen Institute, created and named in his honor, will ensure future generations of leaders and investors can follow his example of outstanding investment performance, rigorous ethics, and open-hearted generosity.”
Tobias J. Moskowitz, the newly named director of the Swensen Institute and the Dean Takahashi ’80 B.A., ’83 M.P.P.M. Professor of Finance at Yale SOM, is a leading researcher in financial markets and investments, including the behavior of prices and investors. After joining the Yale SOM faculty in 2015, he collaborated with David Swensen to conceive and launch the Master’s Degree in Asset Management, which provides a technically rigorous and ethically informed introduction to the industry for recent college graduates.
Moskowitz said the new institute will help SOM in defining the future of asset management. “The new Swensen Asset Management Institute will enhance the school’s existing asset management efforts—from curricular offerings to research to professional connections. Our programs will leverage the expertise of faculty from across Yale as well as a network of investment practitioners to put the school on the cutting edge of the technical side of investing while also ensuring investment decisions benefit a wide range of stakeholders.”
David Swensen assumed management of the Yale endowment in 1985, and over the subsequent 35 years, the endowment generated $36 billion in added value relative to a benchmark portfolio. Swensen’s innovative approach, which included diversifying the endowment’s holdings in non-traditional asset classes, such as natural resource funds, private equity, and venture capital, became known as the “Yale Model” and has had widespread influence. Many of today’s leading endowment managers trained with Swensen, either by taking courses he taught at Yale SOM or by working in the Yale Investments Office. Yale SOM graduates are currently among those leading investments at Rockefeller University, Princeton University, the University of Pennsylvania, and Smith College.
Paula Volent ’97, the current chief investment officer of Rockefeller University, worked with Swensen in the Yale Investments Office early in her career. “It’s not a coincidence that Yale has had such a powerful influence in the world of asset management,” she said. “David Swensen’s example showed how investing with intellectual rigor, purpose, and a sense of mission could create an unbeatable combination. I’m glad that the Institute with David’s name will carry forward that legacy and expand its impact in the future.”
The Swensen Institute will augment and build on Yale SOM’s rich history of study of asset management, asset pricing, and finance more broadly. The SOM finance faculty is noted as a collaborative group with wide-ranging interests, including behavioral finance, the history of finance, asset pricing, machine learning, financial regulation, art markets, and many other topics. The International Center for Finance, led by William Goetzmann, the Edwin J. Beinecke Professor of Finance and Management Studies, has supported research, conferences, data collection, and other initiatives for 20 years. The Yale Program on Financial Stability, directed by Andrew Metrick, the Janet L. Yellen Professor of Finance and Management, has built the world’s leading set of resources for fighting and preventing financial crises. The school has two specialized master’s programs in finance, as well as an asset management area of focus in the EMBA program.
Goetzmann said he is enthusiastic about this transformative gift and its recognition of David Swensen. “Since the early days of the school, Yale SOM finance has meant both cutting-edge research and a broader sense that finance has a meaningful role to play in improving society,” said Goetzmann. “Since I first spoke with the dean about this new institute, I’ve been enthusiastic about how it will build on excellence we have long had in asset management research and teaching. We know that the Swensen Institute will fuel more engagement and inquiry among the faculty and ultimately extend the impact our school has on the investment industry.”
Joel Getz, deputy dean for alumni, development, and special initiatives at Yale SOM, said: “No one more than David Swensen valued the impact philanthropy has on institutions and society. Moreover, he was able to magnify that impact through his pioneering investment style and his generous training and mentorship of countless top investment leaders. This quote from Mahatma Gandhi truly represents the quintessence of David: ‘A sign of a good leader is not how many followers you have but how many leaders you create.’ I am confident that the establishment of the Swensen Asset Management Institute will ensure that the best is still ahead for the field of asset management and that David’s philosophy will be instilled in future generations of scholars and practitioners.”