Denver Post – College endowments and state pension funds that once plowed billions of dollars into hedge funds and private-equity investments as a way to balance their stock holdings officials are watching the value of their alternative investments shrink.

So far, the losses are mostly on paper, but analysts say they could eventually lead to reduced payouts to retirees, higher taxes so state governments can fulfill their promises, or less cash available for colleges to give out as financial aid.

In recent years, endowments and pensions heaped cash into hedge funds — private investment funds that often use unconventional and risky trading strategies. They also bought into private-equity funds, which make direct investments into private companies or buy them out.

Read Complete Article

Comments are closed.

Tags:
31st-october, australian-securities-and-investment-commission, bahrain, california-officials, devonshire, falling-back-to-earth, financial-aid, foreign-affairs, fund-groups, fund-specialist, global-investor-network, losers, loyalty, mayhem, minerals, poor-performance, state-governments, time-investors, trillion