Princeton University announced that its endowment returned 3.9% for the fiscal year ended June 30 in an Oct. 24 news release on its website.
Endowment assets, managed by the Princeton University Investment Co., remained at $34.1 billion, the same as a year earlier.
It is the first positive return for the endowment in three years after two straight years of negative returns. The endowment returned -1.7% for the fiscal year ended June 30, 2023 and -1.5% the prior fiscal year.
While the endowment posted a positive return for the most recent fiscal year, it is by far the lowest yet disclosed among the 28 college and university endowments whose returns for the period have been tracked by Pensions & Investments as of Oct. 24. Among the endowments tracked by P&I, the median return is 10.2%.
The next-lowest return was posted by University of Pennsylvania's $22.3 billion endowment, which returned 7.1% for the fiscal year ended June 30. Other Ivy League institutions have disclosed higher returns, including Providence, R.I.-based Brown University's $7.2 billion endowment, which returned a net 11.3%, and Cambridge-Mass.-based Harvard University’s $53.2 billion endowment, which posted a return of 9.6%.
Princeton’s endowment has returned an annualized 9.2% for the 10 years ended June 30, and an annualized 9.9% for the 20-year period, according to the news release.
The news release did not provide a reason for the underperformance, whether the returns were gross or net of fees and did not provide returns by asset class.
According to the Princeton University Investment Co. website, the endowment's target allocation is 30% private equity, 24% independent return, 18% real assets, 12% developed markets equities, and 8% each emerging markets equity and fixed income/cash.
The independent return asset class consists of "investment vehicles that seek high absolute returns that are independent of broad market trends," according to the website.
