Washington University, Duke Report Record Fiscal 2021 Returns

The endowments gain 65% and 55.9%, respectively, in what has been a banner year for institutional investors. 

The endowments of Washington University in St. Louis and Duke University reported record annual returns of 65% and 55.9%, respectively, for the fiscal year that ended June 30. The massive gains helped the endowments’ asset values rise to $15.3 billion for Washington University and $12.7 billion for Duke.

The Washington University Investment Management Company (WUIMC), which oversees the university’s managed endowment pool, also reported three-, five-, and 10-year annualized returns of 24.9%, 19.2%, and 12.2%, respectively. Chancellor Andrew Martin attributed the robust returns to the work of Chief Investment Officer Scott Wilson and his investment team.

“I’m frankly blown away by these results and incredibly grateful to the talented WUIMC team for giving us this truly transformative opportunity,” Martin said in a statement. “This remarkable return will allow us to take a huge step forward.”

For Duke, the results were a major turnaround from last year, when the endowment’s asset value ended fiscal year 2020 down $100 million to $8.5 billon after the investment portfolio managed to earn a meager 0.7%.

Duke said that each year, it aims to spend between 4.5% and 5.5% of the average value of endowment funds annually over the three previous calendar years to finance student financial assistance, faculty salaries, facilities, and research. For the 2020-21 fiscal year, the endowment and other investment income provided $656 million, or 23% of the university’s operating budget.

“The Duke community has worked hard to address financial challenges that predated, but were amplified by, the pandemic,” Duke University President Vincent Price said in a statement. “This growth in the value of the endowment means we will now have the opportunity to engage more deeply in strategic priorities like student aid and research.”

DUMAC, which manages the endowment’s investment portfolio, also reported three-, five-, and 10-year annualized returns of 18.9%, 16.4%, and 11.6%, respectively.

The huge returns continue a trend of institutional investors reporting record earnings during the past year; however, Washington University and Duke have more than doubled the record returns reported by giants such as Japan’s $1.68 trillion Government Pension Investment Fund (GPIF) and Australia’s Future Fund, which returned 25% and 22.2%, respectively.

Despite the economic damage caused by COVID-19, the portfolios of the world’s largest institutional investors have performed well during the pandemic. The strong markets helped the 300 largest pension funds in the world grow their assets under management (AUM) by 11.5% to reach a collective $21.7 trillion in 2020, according to research from the Thinking Ahead Institute.

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World’s Largest 300 Pension Funds’ AUM Surge 11.5% in 2020

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