Cambridge University's £1.2bn (€1.8bn) endowment may launch private equity and absolute return pooled funds to encourage co-investment among the colleges.

The funds would follow a private equity pooled fund launched by the central university endowment in April. Eleven colleges joined the vehicle, which closed with £50m in commitments, 10% of which has been invested. Andrew Reid, director of finance at Cambridge University, said: "We will be creating pooled-type funds of particular asset classes into which the colleges can buy if it makes sense for their asset allocation. "We see follow-on private equity funds and probably an absolute return fund. They would be for illiquid asset classes and give access to the best fund managers." Each of Cambridge's 31 college endowments direct their investment management and together they manage about £2bn. The central university endowment last week appointed Nick Cavalla, chief investment officer of Man Global Strategies, as the first chief investment officer at any UK university.