U.S. College and University Endowments Achieved 11.9% Return in FY10, According to New NACUBO-Commonfund Study of Endowments
January 27, 2011
During the July 1, 2009 to June 30, 2010 period, U.S. college and university endowments and affiliated foundations achieved an average investment return of 11.9 percent (net of all investment fees and expenses), according to the 2010 NACUBO-Commonfund Study of Endowments (NCSE). The results are based on 850 U.S.-based participating institutions, a record high in the 40-year history of NACUBO’s endowment study series.
Sharp Reversal from FY09
The FY10 results are a sharp reversal from FY09, when, as the result of the deep economic recession, U.S. endowments returned -18.7 percent. Endowments were helped particularly by their gains in equities. U.S. stock holdings among the participants realized a return on 15.6 percent in FY10, while fixed income (domestic and international) gained 12.2 percent. Private equity real estate was the only asset class to suffer a loss in the study period (-15.8 percent). These investment gains helped total market values recover some of the losses suffered during the recession. Total endowment assets rose from $291 billion to $346 billion.
Endowments Still Down Despite One-Year Gains
Returns were broad-based among endowments of all sizes, with those of over $1 billion gaining 12.2 percent, compared with an 11.6 percent average performance among those below $25 million. However, over the past three years, the largest endowments had an average annual return of -3.5 percent, and the smallest returned -3.9 percent. Endowment market values are still 16 percent below the level reported by NACUBO in FY08. Over the past ten years, endowments had an average annual return of 4 percent. But when inflation and endowment spending are taken into account, this gain in real terms results in an overall loss of value for most institutions.
More information about the 2010 NCSE is available on the NACUBO Web site. The full report for the NCSE will be available for purchase and download in mid February.
Director, Research and Policy Analysis
- IRS Releases Final Report on College and University Compliance Project
- NACUBO Seeks Input on Ethics, Fraud, and Controls
- FY13 Implementation Reminder for Independent Institutions
- CAO and CBO Collaborations: Leveraging Institutional Capacity to Impact Effectiveness
August 5-6, 2013
- 2013 Planning and Budgeting Forum
September 16-17, 2013
- WEBCAST: The Higher Education Accounting Forum Online
Wednesday, May 29, 2013 10:00 AM - 5:00 PM ET
- WEBCAST: Improve Your NFP Audit and Accounting Guide IQ
Wednesday, June 26, 2013 1:00 PM ET
- ON-DEMAND: OD: The Cashless and Paperless Business Office
- ON-DEMAND: Affordable Care Act: Implementation Roadmap for Colleges and Universities
- A Guide to College and University Budgeting: Foundations for Institutional Effectiveness, 4th ed. - by Larry Goldstein
- NACUBO's Guide to Unitizing Investment Pools - by Mary S. Wheeler
- Managing and Collecting Student Accounts and Loans - by David R. Glezerman and Dennis DeSantis