Endowment Performance

18 Pages Posted: 8 Jun 2020 Last revised: 24 Jul 2020

Date Written: July 24, 2020


Endowment funds in the U.S., large and small, significantly underperform passive investment. Moreover, an analysis of the performance of 43 of the largest individual endowments over the 11 years ended June 30, 2019, reveals that none outperformed with statistical significance, while one in four underperformed with statistical significance. Alternative asset classes have failed to deliver diversification benefits and have had an adverse effect on endowment performance. Given prevailing diversification patterns and costs of 1 to 2% of assets, it is likely that the great majority of endowment funds will continue to underperform in the years ahead.

Keywords: Wealth Management, Endowment Funds, Pension Funds, Alternative Investments, Portfolio Choice

JEL Classification: G11

Suggested Citation

Ennis, Richard, Endowment Performance (July 24, 2020). Available at SSRN: https://ssrn.com/abstract=3614875 or http://dx.doi.org/10.2139/ssrn.3614875

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