U.S. educational endowments returned 10.6% in fiscal year 2006, ended June 30, according to the Commonfund Benchmark Study released today. The endowments returned 9.7% in fiscal 2005, 14.7% in 2004 and 3.1% in 2003, but saw a 6% decline in 2002 and a 3% dip in 2001. The average three-year return was 12.3% in fiscal 2006, compared with 16.1% the prior year. Over five years, endowments returned an average 6.8% for fiscal year-end 2006, compared with 3.5% in 2005.
Private universities and colleges returned 11.2% in fiscal 2006, compared with 10.1% for public universities and 9.6% for independent K-12 schools, Commonfund data showed.
The average asset allocation in fiscal 2006 was 39% in alternatives, compared with 35% in fiscal 2005; 20% international equity, up from 18%; 26% domestic equity, down from 28%; 13% fixed income, from 16%; and 2% cash, from 3%.
Commonfund said June 30 was the end of the fiscal year for more than 80% of the endowment offices of 741 U.S. colleges, universities and other educational institutions interviewed in the third and fourth quarters.
