U.S. endowments up nearly 20% for year, Commonfund-NACUBO study shows
By Christine Williamson | November 7, 2011 2:59 pm
U.S. endowments returned 19.8% on average for the fiscal year ended June 30, according to preliminary data released Monday by Commonfund Institute and the National Association of College and University Business Officers, cosponsors of an annual survey.
The average one-year return for the fiscal year ended June 30, 2010, was 11.9% for the full universe of endowments surveyed, according to the 2010 NACUBO- Commonfund Study of Endowments.
The preliminary data are based on responses from about one-third of the 850 U.S. colleges and universities that participate in the survey, William F. Jarvis, managing director of Commonfund Institute, said in an interview. Final results will be released in late January.
Analysis of one-year returns as of June 30 for the partial universe of respondents showed “a very tight spread,” with the largest endowments (with assets over $1 billion) returning an average 20.2% for fiscal 2011 vs. an average 19.1% for the smallest endowments managing less than $25 million, according to a news release.
By comparison, the median return for the year ended June 30 was 20.12% for the 900 institutional trusts included in Wilshire Trust Universe Comparison Service. For the one-year period, the S&P 500 index returned 30.6%; MSCI World index, 26.7%; and the Barclay Capital Aggregate Bond index, 3.84%.
Using return data from previous surveys and assuming a 5% spending rate, NACUBO- Commonfund researchers estimated that as of June 30, assets of endowments in the universe totaled 86% of their value as of June 30, 2007. As of June 30, 2010, the assets of the average endowment stood at about 75% of the 2007 total.
“What stands out in these preliminary figures is the fact that, despite the positive returns of this year and last, endowments still have not completely recovered from the damage inflicted by the market declines that accompanied the 2008-2009 credit crisis," said a statement from John D. Walda, NACUBO president and CEO, and John S. Griswold, Commonfund Institute executive director.