Stanford University, Palo Alto, Calif., said its investments rose 14.4% in the year ended June 30, beating returns at Harvard and Yale universities on gains in credit investments and stocks.
The increase, along with gifts from donors and distributions to the university, led a 9.6% climb in endowment assets to $13.8 billion in the year ended Aug. 31, according to an e-mailed statement from the university.
Stanford generated an average annualized return of 6.9% in the 10 years through June 30. That compares with Harvard's 7% annualized 10-year gain, Yale's 8.9% return and the 3.4% median increase of public and corporate pensions, endowments and foundations tracked by Wilshire Associates for that time period.
“Our investment managers took advantage of strong equity and credit markets through the first three quarters of the fiscal year, allowing us to make up some of the ground lost in fiscal 2009,” John Powers, CEO of Stanford Management Co., which manages the university's endowment assets, said in the statement.
Mr. Powers had planned to sell as much as $1 billion in private equity, distressed debt and energy funds to take advantage of rising prices before canceling the transaction in December. Stanford had lost a record 26% the previous year, following the September 2008 bankruptcy of Lehman Brothers Holdings Inc.
As its endowment tumbled, the university cut the fund's payout to the school by 10% last year and by an additional 15% this year, according to the statement. Stanford plans to spend $758 million, or 5.5% of its endowment, this fiscal year, the university said.
Yale said last week that investments at its $16.7 billion fund increased 8.9% as of June 30, trailing Cambridge, Mass.-based Harvard and the three other Ivy League funds that reported returns for the past year. Results at Yale, New Haven, Conn., were hampered by a second straight year of losses on real estate, timber and oil and gas holdings.
Harvard's $27.4 billion endowment rose 11%. Columbia University, New York, said its $6.5 billion endowment jumped 17% in the past year, while the University of Pennsylvania in Philadelphia reported its $5.7 billion fund gained 13%. The $3 billion fund at Dartmouth College, Hanover, N.H., advanced 10%.
Massachusetts Institute of Technology, also in Cambridge, said investments climbed 10% in the past year, leading to a 5.1% gain in the endowment to $8.3 billion in the year ended June 30.
Stanford's investments include most of its endowment as well as money from Stanford Hospital & Clinics and the Lucile Packard Children's Hospital. Those investments were valued at $15.9 billion as of June 30, the school said.