12-9-09: Princeton: Endowment returns up 5 percent as of Sept. 30

The University endowment’s return on its investments rose more than 5 percent during the fiscal quarter ending on Sept. 30, University spokeswoman Cass Cliatt ’96 said in an interview. She also said in an e-mail that the investment returns have seen “modest additional gains” over the last nine weeks, but she added that the University did not have data on the value of the endowment as of Sept. 30.

The endowment stood at $12.6 billion on June 30, 2009, down 22.7 percent over the previous 12 months. The endowment’s return on investment declined by 23.5 percent during that period.

Princeton University Investment Company president Andrew Golden told Princeton Alumni Weekly that modest adjustments have been made to the endowment’s asset allocation. According to the magazine, the allocation target for the current fiscal year is 25 percent independent return, 23 percent private equity, 23 percent real assets, 9 percent emerging markets, 7.5 percent domestic stocks, 6.5 percent ­developed-country stocks and 6 percent bonds.

Roughly 48 percent of the University’s FY2009 operating budget came from the endowment.

In April, President Tilghman sent out an e-mail to the University community in which she warned that the endowment could lose up to 30 percent of its value. In that e-mail, she also announced a two-year plan to reduce the University’s operating budget by $170 million.

That same month, the University announced that department budgets would be slashed by an average of 7.5 percent over the next two years. The University is still adhering to that goal even though it saw a smaller endowment loss than it initially projected.

“We developed a plan last spring that we are adhering to, and we are not changing the two-year plan that we developed,” Tilghman explained in a September interview with The Daily Princetonian. “If, in fact, the endowment continues to do better than we expected, we will use that huge benefit to bring us back into line with our current spending policy.”

http://www.dailyprincetonian.com/2009/12/09/24693/