September 26, 2011
Stanford Management Company announces 2011 results
The Stanford University Merged Pool (MP) achieved a 22.4 percent investment return for the 12 months that ended June 30, 2011, according to the Stanford Management Company (SMC). The MP is Stanford's primary investment pool and includes most of the university's endowment and expendable funds, as well as capital reserves from Stanford Hospital and Clinics and Lucile Packard Children's Hospital.
Over the past 10 years, the Stanford MP has achieved an annualized return of 9.3 percent, growing from $7.9 billion to $19.5 billion as of June 30, 2011. During the same period, the U.S. equity market, as measured by the S&P 500 Total Return Index, increased by an average of 2.7 percent per year, and the U.S. bond market, as measured by the Barclays Aggregate Bond Index, increased 5.7 percent per year.
"We are pleased with our returns for fiscal 2011. But we remain concerned about the uncertain macroeconomic climate and its impact on global financial markets," said John Powers, CEO of the Stanford Management Company.
Stanford University's endowment rose in value by 19.5 percent over the past year to a value of approximately $16.5 billion as of Aug. 31, 2011, the last day of Stanford's fiscal year. The growth in endowment value results from investment gains and losses, endowment gifts and other funds transferred into endowment, offset by the annual payout for university operations. The university's budgeted endowment payout for fiscal year 2012 is $838 million, equal to 5.1 percent of the beginning-of-year endowment value.
"While we're thrilled with investment returns and endowment growth over the past two years, Stanford's endowment still has not recovered the losses sustained in 2008-09," said Randy Livingston, vice president for business affairs and chief financial officer. "We continue to be concerned about the possibility of reductions in federal research funding and an investment downturn driven by European debt problems and economic weakness at home."
For detailed information about the Stanford University budget, including the 2012 Stanford University Budget Plan, see http://www.stanford.edu/dept/pres-provost/budget/plans/index.html and http://bondholder-information.stanford.edu.