Quietly, some of the best performances have been realized by the investment managers of the large endowment funds of major universities.

These are names that we all would recognize as the most prestigious educations institutions in America.  But if there reputations as universities are stodgy and conservative their investment methods are not.

These are things available to these huge funds that most of us cannot access, but the basic concept is universal; diversification.

In the words of one of the best of the institutional managers "use a lot of asset classes, invest in the long term and keep costs low".  Many investment areas don't correlate with the U.S. stock and bond markets.  These will do well when we are not. This seems obvious, but many investors have concentrated their entire portfolios in domestic investments. 

Often overlooked are commodities.  This market segment is well represented in the portfolios of large universities, averaging nearly 15%. There is also a significant representation of emerging market investments; think about what has been happening to china and other developing economies.

We can't access private equities and hedge funds like large institutions, but we can create broadly diversified portfolios that will serve us well regardless of general market conditions.