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University News

Endowment jumps to $2.5 billion in year of high returns

Senior Staff Writer
Thursday, October 20, 2011

The University posted an 18.5 percent return on its endowment for the fiscal year that ended in June, bringing the total endowment figure to $2.5 billion. The unusually high gains were largely due to success in the market, said Beppie Huidekoper, executive vice president for finance and administration.

Last year’s 6.9 percent return left the endowment at $2.1 billion. The average return over the past 10 years is about 7.7 percent. Huidekoper said she was “really pleased” with this year’s uptick.

The endowment peaked in value at $2.8 billion before falling 27 percent in the economic downturn of 2008.

The rest of the Ivy League posted similar returns this year. Columbia enjoyed the greatest rate of growth, with a return of 23.6 percent in the 2011 fiscal year, bringing its endowment to $7.8 billion.

Harvard’s endowment grew by 21.4 percent to $32 billion, while Princeton and Yale each saw their endowments grow by 21.9 percent, bringing their totals to $17.1 billion and $19.4 billion, respectively.

Though the market was generous in fiscal year 2011, Huidekoper cautioned against excess optimism in light of recent economic events. “The market has been way off to date this year, so our returns are not going to continue,” she said.

The investment staff aims to make a return on the endowment while also providing enough funds to support areas like need-blind financial aid and the University’s operating budget. Fourteen percent of the 2011 fiscal year operating budget was funded by the endowment, according to a University press release.

“Brown’s investment strategy is slightly more conservative than some of its peers because we have less money,” Huidekoper said. “We may not do as well in the good years, but we don’t do as bad in the bad years.”

Other Ivy League institutions posted returns similar to Brown’s. Cornell saw its endowment grow 17 percent in the last fiscal year. The endowments of Penn and Dartmouth rose 18.6 percent and 18.4 percent, respectively.

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