Paul L. Caron

Wednesday, August 10, 2022

College Endowments Post 10.2% Loss, Biggest Decline Since 2009's 17.6% Loss

Bloomberg, College Endowments Post Biggest Losses Since Financial Crisis:

Investments in US college endowments declined the most since the global financial crisis, owing in part to double-digit losses in US equity markets.

Endowments lost a median 10.2% before fees for the 12 months through June, according to data to be published Tuesday by Wilshire Trust Universe Comparison Service.


The largest funds — those with assets of more than $500 million — fared substantially better, with a slight gain of 0.9%. Larger endowments tend to invest more in alternatives such as private equity funds, which offered a buffer against the equity-market losses, while smaller ones rely more heavily on US stocks. ...

The returns contrasted sharply with the previous year’s results, when endowments returned a median 27%, their best results since 1986. The largest funds posted a median gain of 34% last year, driven by private equity and venture capital, with some colleges faring even better. Washington University in St. Louis notched returns of 65% and several schools gained more than 50%, including the Massachusetts Institute of Technology, Bowdoin College and Vanderbilt and Duke universities.

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