Stanford Posts Very Strong Investment Returns

A rate of return and endowment growth much higher than Harvard's and Yale's

According to accounts by Bloomberg and the Stanford Daily (and confirmed by an official news statement), Stanford Management Company has reported a 14.4 percent return on endowment investments for the fiscal year ended last June 30. Net of distributions to support Stanford's operations, but factoring in gifts received, that return on investments enabled the university's endowment to grow a relatively robust 9.6 percent during the year, from $12.6 billion to $13.8 billion.

In comparison, Harvard Management Company reported an 11 percent investment return for fiscal 2010, and a net growth in the value of the endowment of just 5.4 percent,to $27.4 billion. Yale reported an 8.9 percent investment return, and just 2.5 percent appreciation in its endowment, to $16.7 billion. All three institutions follow a highly diversified investment strategy, with significant reliance on private equity, real estate, and other relatively illiquid assets intended to produce stronger returns over the long term than are available from holdings of public securities. During fiscal 2009, Harvard's investment returns were negative 27.3 percent, Stanford's negative 25.9 percent, and Yale's negative 24.6 percent. The other institution with a similar strategy and a large endowment portfolio, Princeton, has yet to report fiscal 2010 results.

Among other schools that have reported, Columbia's investment return was 17 percent, Penn's 13 percent, Dartmouth's 10 percent, and MIT's 10 percent.

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