Princeton Endowment Returns 12.5%

Investments' value rises by $1.6 billion to $23.8 billion.

Princeton University’s endowment reported a 12.5% investment gain for the fiscal year that ended June 30, increasing the endowments’ value by $1.6 billion to $23.8 billion.

The returns outpaced last year’s results, when the endowment lost 2.7%, but were shy of the 12.9% return from the broad universe of college and university endowments as measured by consulting firm Cambridge Associates.

The endowment’s average annual return over the past 10 years is 7.1%, which the university said places the endowment among the top 1% of 458 institutions listed by the Wilshire Trust Universe Comparison Service.

Further details of the fund’s performance have not yet been disclosed. The results will be certified by the Princeton University Investment Co. (PRINCO), which manages the endowment, at a meeting of its directors on Oct. 19.

“The university relies on earnings from the endowment to cover more than half of its operating budget, as well as to help fund its highest-priority strategic initiatives,” said Provost Deborah Prentice in a statement. “These earnings enable the university to provide generous financial aid.”

The asset allocation set by PRINCO is heavy on equities, with 95% of the portfolio dedicated to them. However, only 10% of the portfolio is allocated to US equities. Large portions of the portfolio are also allocated to high-return categories, such as international, hedged, and private investments.

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