Yale Earns 19.4% Return on its Endowment

Yale’s Endowment earned a 19.4% return in the fiscal year ending June 30, 2004, bringing total assets to $12.7 billion, Yale’s Investments Office reported. Investment officials said the excellent performance resulted in approximately $2.1 billion in gains for the University.

“The superb management of the Endowment by David Swensen and his investment team has greatly enhanced the University’s ability to carry out its mission,” President Richard C. Levin said. “I know I speak for the faculty, students, alumni and staff of Yale in thanking the Investments Office for its outstanding performance over many years.”

The Yale Corporation, at its most recent meeting, approved an increase in the target rate of Endowment spending to 5.25 percent from the previous level of 5.0 percent. The increase in the target rate accompanied a change in the smoothing formula designed to dampen the volatility of the flow of funds released from the Endowment to support Yale’s operations.

Spending from the Endowment in the University’s current fiscal year is expected to total $562 million, an 11% increase over Endowment spending in the prior fiscal year. The Endowment’s contribution equals an estimated 32% of the University’s revenues, more than two times the share of operating budget support provided a decade ago.

Yale’s Endowment returned an annualized 16.8% over the past 10 years, placing the University in the top one percent of institutional funds. Over the past decade, Endowment funds grew from $3.6 billion to $12.7 billion.

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Tom Conroy: tom.conroy@yale.edu, 203-432-1345