<instructions>Your goal is to analyze the following comment and estimate how highly it will be upvoted by the Hacker News community.</instructions><comment><author>andr3w321</author><text>I don&amp;#x27;t really care if universities hire hedge managers to manage their endowment, but it&amp;#x27;s absurd that schools with multibillion dollar endowments still charge tuition.  Yale has ~12,000 students and a $26 billion endowment.  Tuition is ~$45,000 per student.  $45,000 * 12,000 = $540 million.  They can&amp;#x27;t spend 2%(540&amp;#x2F;26,000) of their endowment per year on free tuition?  What is this money for?&lt;p&gt;Of course this ignores financial aid so Yale&amp;#x27;s operating costs are much less than $500 mil&amp;#x2F;year.  If you&amp;#x27;re going to donate to a university your money will go much further at a small college that actually needs your money and will actually spend it rather than hoarding it.  TMQ had some great articles about this topic back in the day.  &lt;a href=&quot;http:&amp;#x2F;&amp;#x2F;espn.go.com&amp;#x2F;nfl&amp;#x2F;story&amp;#x2F;_&amp;#x2F;page&amp;#x2F;TMQWeekFour140930&amp;#x2F;robert-griffin-iii-blaine-gabbert-why-mega-trades-work-nfl-tuesday-morning-quarterback&quot; rel=&quot;nofollow&quot;&gt;http:&amp;#x2F;&amp;#x2F;espn.go.com&amp;#x2F;nfl&amp;#x2F;story&amp;#x2F;_&amp;#x2F;page&amp;#x2F;TMQWeekFour140930&amp;#x2F;robert...&lt;/a&gt;  Halfway down.</text><parent_chain></parent_chain></comment><story><title>Universities Are Becoming Billion-Dollar Hedge Funds with Schools Attached</title><url>http://www.thenation.com/article/universities-are-becoming-billion-dollar-hedge-funds-with-schools-attached/</url></story>
<instructions>Your goal is to analyze the following comment and estimate how highly it will be upvoted by the Hacker News community.</instructions><comment><author>inthewoods</author><text>I&amp;#x27;ve been waiting for this article to surface on HN. The other problem here is that hedge funds, as an investment vehicle, really haven&amp;#x27;t done that well. So it is essentially a transfer of donations to the hedge fund industry while the endowment could have done better avoiding them altogether. Obviously there are some hedge funds that have done well - but on the whole they are expensive and do not add alpha.&lt;p&gt;Back in the day, Harvard didn&amp;#x27;t outsource to hedge funds but instead had the portfolio managers in-house. These folks were paid a small fraction of what they would make in the private hedge fund industry, but my understanding is that the Harvard community was up in arms at what they were making - so they quit&amp;#x2F;got pushed out and then Harvard started outsourcing to hedge funds. The result was worse performance and higher fees.&lt;p&gt;Of course, it&amp;#x27;s not all roses - Larry Summers famously made a terrible bet on interest rates that Harvard had to unwind at a large loss.</text><parent_chain></parent_chain></comment><story><title>Universities Are Becoming Billion-Dollar Hedge Funds with Schools Attached</title><url>http://www.thenation.com/article/universities-are-becoming-billion-dollar-hedge-funds-with-schools-attached/</url></story>