Michigan State Endowment Gains 15.4%

Foundation attributes strong gains to active management.

The $2.66 billion Michigan State Endowment reported annual gains of 15.4% for the fiscal year ended June 30.

The university’s common investment fund also reported annualized trailing three-, five-, and 10-year earnings of 4.5%, 8.4%, and 5.0%, respectively. The annual earnings also beat out its 12.7% benchmark.

“Our performance was driven by strong returns in our hedge fund portfolio, and active management was a significant contributor in our global equities portfolio,” Philip Zecher, the fund’s chief investment officer, told Bloomberg News. “We are still concerned that active management’s performance in the long-only, large-cap space is ephemeral.”

As of June 30, of the endowment’s total assets of $2.66 billion, 34.7% were comprised of global equities ($926 million), 24.5% of hedge funds ($653.4 million), 19.2% of private investments ($512.8 million), 8.2% of emerging markets equity ($219.4 million), 5.9% of fixed income ($158.2 million), 4% of private real assets ($106.3 million), 2.2% of private real estate ($57.6 million), and 1.2% of marketable real assets ($32.6 million).

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