For years, we’ve been told there’s a hierarchy in investing.

At the top:
“Smart money.”
Private equity.
Hedge funds.
Venture capital.
Closed-door deals.

At the bottom:
Index funds.
The S&P 500.
The so-called “lazy portfolio.”

And retail investors?
We were told we were “dumb money.”

But something interesting has been happening.

Even billion-dollar university endowments, with access to the most exclusive private equity deals in the world, have recently underperformed a simple public market portfolio.

And that matters.

🏛️ What Happened?

Major university endowments like:

• Harvard (~$56+ billion)

• Yale (~$40+ billion)

• Princeton (~$30+ billion)

• Stanford (~$30+ billion)

These aren’t small funds.

They are run by full-time professional investment teams with access to private equity firms most retail investors will never see.

Many of these endowments allocated:

• 30–40%+ to private equity

• Significant portions to hedge funds

• Smaller portions to public stock index funds

The assumption?

Private equity = higher sophistication = higher returns.

But over the past few years, public markets specifically broad U.S. equities like the S&P 500 have outperformed many private equity allocations.

In some fiscal years:

Endowment return: ~8–12%
S&P 500: ~15%+

That gap is not small when you’re managing billions.

🧠 Why Is This Happening?

Private equity historically benefited from:

• Falling interest rates

• Cheap leverage

• Expanding company valuations

• Strong exit environments

But conditions have changed:

→ Interest rates rose after 2022
→ Financing costs increased
→ Private companies are harder to sell at premium prices
→ Liquidity dried up

Meanwhile, public markets rebounded aggressively.

Private equity, which is illiquid by nature, couldn’t adjust as quickly.

💬 What Is a “Lazy Portfolio”?

A classic “lazy portfolio” (often called a Boglehead-style portfolio) is something like:

• 60–70% diversified stock index funds

• 30–40% bonds

Or even simpler:

A total market index fund.

That’s it.

No private deals.
No insider access.
No closed-door meetings in Manhattan.

Just:

Low-cost.
Diversified.
Disciplined.

And over the last several years, that approach beat many complex institutional portfolios.

🩺 Why This Should Matter to Nurses

Most nurses do not have access to:

• Private equity funds

• Venture capital deals

• Hedge funds

• “Alternative” institutional vehicles

And that can create FOMO.

It can feel like:

“Am I missing out?”

The recent data is a reminder:

You are not structurally disadvantaged by using index funds.

In fact, in certain market environments, you may be better off.

🏗️ The Illusion of Complexity

There’s an industry narrative that:

More complex = more sophisticated
More exclusive = more profitable

But complexity often comes with:

• Higher fees

• Less transparency

• Illiquidity

• Longer lock-up periods

• Performance smoothing that hides volatility

Public index funds offer:

• Daily liquidity

• Full transparency

• Ultra-low expense ratios

• No lockups

And historically?
Strong long-term returns.

🧠 What I’m Thinking About as I Study This

Private equity isn’t “dead.”

Over 10-, 15-, and 20-year periods, private equity has outperformed public markets in certain cycles.

But cycles change.

And the past few years are a reminder that:

No asset class dominates forever.

Which reinforces something I teach over and over inside NurseMoneyDate®:

You don’t need secret investments.

You need:

• Diversification

• Cost control

• Patience

• Structure

📉 The Emotional Lesson

It’s easy to feel like Wall Street has access to something you don’t.

But when a simple 70/30 portfolio beats billion-dollar endowments with private equity exposure?

It humbles the hierarchy.

Slow.
Broad.
Low-cost.
Disciplined.

Still wins.

💗 NurseMoneyDate® Bottom Line

If you’re:

• Maxing your 403(b)

• Investing in low-cost index funds

• Rebalancing annually

• Staying consistent

You are not behind.

You are not “dumb money.”

You are using the same public market engine that has quietly outpaced complex institutional strategies in recent years.

Private equity may rebound.

Markets will rotate.

Cycles will shift.

But the lesson remains:

You do not need exclusivity to build wealth.

You need discipline.

And discipline is free.