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Endowment yields 12.5% growth
(updated 9/25)

Yale's endowment earned a 12.5 percent return in the past fiscal year, the university announced today.

Investment gains were roughly $2.3 billion. After spending of just over $1 billion, the endowment totaled $20.8 billion on June 30—up from $19.3 billion a year earlier.

Perhaps anticipating criticism (like that voiced in the past by US Senator Chuck Grassley of Iowa) about tax-exempt organizations sitting on huge piles of money, a Yale press release notes that "endowment distributions to the operating budget have more than doubled in the last decade." The current budget calls for endowment spending to supply more than a third of Yale's "net revenues," the press release says.

It also touts Yale's investment record:

The university’s longer-term results remain in the top tier of institutional investors. Yale’s endowment returned 11.0 percent per annum over the ten years ending June 30, 2013, surpassing broad market results for domestic stocks, which returned 8.1 percent annually, and for domestic bonds, which returned 4.5 percent annually. Relative to the estimated 7.8% average return of college and university endowments, over the past decade Yale’s investment performance added $7.0 billion of value in the form of increased spending and enhanced endowment value. 

One of the few peer institutions to announce its 2013 endowment results so far is the Massachusetts Institute of Technology. Headed by Yalie Seth Alexander ’95—a protégé of Yale's investment chief, David Swensen ’80PhD—MIT's fund posted an 11.1 percent return.

UPDATE: Harvard's endowment fund, managed by Yalie Jane Mendillo ’80, ’84MBA, reports an 11.3 percent return for fiscal 2013.

Filed under endowment, MIT, David Swensen, Seth Alexander
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