Thursday, August 5, 2010


The 20 Worst Managed Endowments:

1) Harvard, down 30% and $10.9 billion

2) Yale, down 29% and $6.5 billion

3) Duke, down 28% and $1.7 billion

4) Brown, down 27% and $730 million

5) Syracuse, down 33% and $327 million

6) University of Minnesota, down 27% and $312 million

The Daily has quite an amazing story about how badly the University of Minnesota endowment has tanked, see:

U Endowment takes a dive

In this article the fellow pictured above is quoted as saying:

"This was a perfect storm of bad circumstances,"

While the University of Minnesota lost more than nearly all other Big Ten universities, it fared better than Northwestern and other large, private institutions.

[Our 24.2 vs. their 24.8? Wow!]

"Those were the smart guys, I mean the really smart guys," Mason said, referring to Ivy League investment officers whose funds lost as much as 29.8 percent.

[You mean like Larry Summers, Mr. Mason? No, those were the arrogant guys - the lotus eaters who were enthralled by swallowing Mr. Swensen's endowment model. ]

After the University took money out of the stock market, the market began to trend upward. As a result, many universities will see endowment gains around 12 percent, while the University’s endowments are expected to grow by 6 percent.
[Another situation that happened?]

Allen [Regent Board Chair] said, however, that the timing of a move back into the market is left up to the "professionals."

[And who would that be, presumably?]

"We are optimistic," Mason said. "We’re happy with the way we are positioned and think that the way the portfolio is set up that we’re set to receive good returns in future years."
Fortunately, past performance does not predict future returns, but I'd be a little more comfortable if we had someone at the helm who had a better track record. 6% less return on investment than normal is a lot of money when we are talking about a several billion dollar endowment.

I've tweeted on some past history that might be of interest to people concerned with investments going under water...

wbgleason If #UMN could invest in secret, could pull down 30% on some great deals, at least we were told that in 3/09 #Minnesota

wbgleason Speaking of endowments tanking, #UMN Google Endowment piece is still worth reading... #Minnesota

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