How the Trump Rally Could Save Endowments

The right combination of high returns, predictable correlations and tolerable volatility holds the key to meeting the objectives of most investors. The last few years have not been easy for many -- in part because of the rather unusual relationships among the main asset classes that feature in strategic asset allocations.

However, there is one group of investors -- endowments and foundations -- whose inherent characteristics provide, at least on paper, greater flexibility and longer staying power to harvest the benefits of their portfolio positioning. But for them, too, it has not been easy. And their discomfort can be amplified by crucial funding requirements and noncommercial objectives that many of them often face.