A 2010 nationwide study shows Drew’s fund, valued at nearly $200 million, growing faster than most.

Drew’s endowment is one of the highest-performing university endowments in the country, according to a 2010 study by the National Association of College and University Business Officers (NACUBO).  The school’s finance officials attribute the endowment’s outstanding performance to a series of recent strategic and structural changes.

“During the last 36 months, university staff and the Drew Investment Committee have worked closely with the Fund Evaluation Group, our outside consultant, to diversify our asset allocation,” said Howard Buxbaum, Drew’s vice president of finance and business affairs.  “We’ve added the long/short equity, emerging market equity, distressed debt, global credit, non-agency mortgage-backed securities, multi-strategy credit and private energy asset classes to the university’s portfolio.”

With a net of fee return of 14.2 percent for fiscal year 2010, the growth of Drew’s endowment outpaced the average and median for institutions of higher learning by 2.3 and 2.1 percentage points, respectively.  The school’s annualized return of 4.8 percent over the last ten-year period represents growth that is 1.4 and 1.6 percentage points higher than average and median.  Collectively, these results placed Drew solidly in the top quartile for endowment performance in the one- and ten-year periods.

The NACUBO-Commonfund Study of Endowments represents a combination of the traditional NACUBO Endowment Study and the Commonfund Benchmarks Study of Educational Endowments.  The two organizations first partnered in 2008 to conduct a survey of roughly 1,000 institutions nationwide.  The study, which incorporates both qualitative and quantitative elements, is focused on investment performance, asset allocation, market values, portfolio rebalancing, debt load and institutional response to the current investment environment.

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Posted: January 14, 2011