The Endowment Index calculated by Nasdaq OMX fell for the second consecutive quarter, declining 0.41% on a total return basis for the three-month period ended June 30, after dropping 0.36% during the first quarter of the year.
Despite ending the quarter lower again, 10 of the index’s 19 components posted gains during Q2, though only four gained more than 1%. The biggest gainers were commodities-oil and gas, which returned 17.20%, followed by domestic real estate, which climbed 8.83%. Domestic equity rose 3.90%, while commodities increased 2.30%.
Emerging Markets-China led the nine components that posted declines, tumbling 14.19% during the quarter, followed by emerging markets-equity, which shed 7.76%. Gold was off 5.59%, and emerging markets-fixed income ended the quarter off 4.19%.
The index represents an asset allocation used by major universities’ endowments, and its methodology is based on the portfolio allocations of more than 800 higher learning institutions managing over $500 billion in total assets. The asset allocation includes stocks, bonds, and alternative investments, such as hedge funds, private equity, and real assets.
Within each of the 19 components are more than 30,000 underlying securities, with a current target allocation of 52% alternatives, 36% equity, 8% fixed income, and 4% liquidity, which is represented by the SPDR Bloomberg Barclays 1-3 Month T-Bill ETF.