Duke University’s endowment posted a -2.6% return for the fiscal year ended June 30, compared with 4.4% in fiscal year 2015 and 20.1% in fiscal year 2014, according to a report posted on the university’s website.
DUMAC, which manages the Durham, N.C.-based university’s endowment and other long-term investment assets, ended the fiscal year at $6.8 billion, down from a record $7.3 billion the previous year. DUMAC returned an annualized 7.1% over the past 10 years.
In addition to managing the endowment, DUMAC manages the employees’ retirement pool; Duke University Health System’s investments; the $3.35 billion Duke Endowment, the private charitable trust established by Duke University’s founder; and some of the university’s working capital.
DUMAC’s return target is 5%, which has been achieved over the long term by a 70% exposure to equity investments historically, according to the endowment’s website. Full details on the June 30 fiscal year-end returns will be published later this year.
The university’s annual spending rate policy is 5.5% of the long-term pool’s average asset size over the three previous calendar years.
According to the 2015 fiscal-year report, the-then $7.3 billion endowment’s long-term target allocation was 49% public and private equity; 13% each commodities and credit; 11% real estate; 9% other, which includes U.S. Treasury inflation-protected securities and non-U.S. inflation-linked bonds; and 5% public obligations, such as Treasuries.
Calls to the endowment office were not returned at press time.