Investments made by major universities suffered big time this past year. Data gathered from 842 American colleges and universities participating in the 2009 National Association of College and University Business Officers-Commonfund Study of Endowments show that these institutions’ endowments returned an average of -18.7 percent (net of fees) for the 2009 fiscal year (July 1, 2008 – June 30, 2009).

Study results show that investment returns were negative for all asset classes but two—fixed income, which generated a 3.0 percent gain, and short-term securities/cash, which returned 0.8 percent. International equities produced the weakest return, -27.6 percent. Domestic equities were not far behind, with a return of -25.5 percent on average. Alternative strategies returned -17.8 percent.

Survey data indicated that participating institutions’ dollar-weighted asset allocation was:

Within alternative strategies, the asset mix was:

FY2009’s total return confirms how difficult the year was for educational institutions. In mid-December, partial data gathered from 504 institutions showed the average return for FY2009 was -19.0 percent. “These results illustrate the extreme difficulties colleges and universities faced at the height of the global economic crisis. Our hope is that the strong first half of FY2010 augurs well for the full fiscal year and that a year hence the story will be much more positive,” according to NACUBO President and Chief Executive Officer John D. Walda and Commonfund Institute Executive Director John S. Griswold.