These are good arguments for providing stable levels of funding per year, but there are often ways to further that goal without materially dialing back the riskiness of one’s investments (probable exception: crypto, because the swings can be so wild and because other EA donors may be disproportionately in crypto). One classic approach is to set a budget based on a rolling average of the value of one’s investments—for universities, that is often a rolling three-year average, but it apparently goes back much further than that at Yale using a weighted-average approach. And EA philanthropists probably have more flexibility on this point than universities, whose use of endowments is often constrained by applicable law related to endowment spending.
These are good arguments for providing stable levels of funding per year, but there are often ways to further that goal without materially dialing back the riskiness of one’s investments (probable exception: crypto, because the swings can be so wild and because other EA donors may be disproportionately in crypto). One classic approach is to set a budget based on a rolling average of the value of one’s investments—for universities, that is often a rolling three-year average, but it apparently goes back much further than that at Yale using a weighted-average approach. And EA philanthropists probably have more flexibility on this point than universities, whose use of endowments is often constrained by applicable law related to endowment spending.