Finance Office

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Year in Review

Endowment Funds 2013 Investments Report

The University of San Diego’s endowment represents the combined support of numerous individual gifts that are directed, usually by specific donor request, to scholarships, professorships, research and other essential activities. The endowment is comprised of pooled funds invested over the long-term (the “Pool”), and other assets including real estate and cash equivalents. The Pool’s investment performance for the year ending June 30, 2013 was +13.0%, and 10.6% and 4.0% for the three-year and five-year trailing periods, respectively. The net asset market value of the University’s total endowment was $395.6 million on June 30, 2013.

The Pool’s net investment performance is measured formally every quarter against several benchmarks. One is the Custom Portfolio Benchmark consisting of indices representing the asset classes of the Pool, weighted by their policy target allocations. In addition, the Pool’s returns are compared to theNational Association of College and University Business Officers (NACUBO) & Commonfund Study of Endowments, which compiles the investment performance of over 800 U.S. colleges and universities on an annual basis. The University has outperformed its Custom Portfolio Benchmark over the most recent trailing 1, 3 and 5 fiscal year periods ending June 30, 2013 by 3.5%, 1.5% and 1.5%, respectively. In addition, the University has either outperformed or performed comparatively to the broader NACUBO mean for the three most recent fiscal years for which NACUBO data is available (2010, 2011 and 2012).

The overall investment goal for the Pool is as follows: 1) to provide a relatively predictable, stable and constant return sufficient to meet the spending needs of the University; 2) to preserve and enhance the real (inflation-adjusted) purchasing power of the Pool through active management; and 3) to increase the Pool through unspent income and gains, appreciated value, gifts and other appropriated funds. The allocation is reviewed regularly and is rebalanced as necessary. Currently, the Pool is comprised of domestic and international public equities, hedge funds, private and venture capital, real assets, fixed income holdings and cash and cash equivalents.

Terry Kalfayan
Vice President for Finance & CFO