After a grueling year for performance, large U.S. university endowments and public pensions saw a bounce in the fiscal first quarter.
University endowments with more than $500 million in assets and pension funds with more than $1 billion each gained a median 3.7 percent in the first quarter through Sept. 30, according to results published Wednesday by Wilshire Trust Universe Comparison Service, a database provided by Wilshire Associates.
Global equities, fixed income and real estate helped bolster the performance for endowments and pensions of all sizes, the strongest since the second quarter of 2014, according to Wilshire.
“You roll off a bad quarter and you roll on a good quarter and you’re going to have a good year,” said Robert Waid, managing director for the analytics arm of Wilshire Associates. “That’s what this really translates into.”
Universities rely on endowments to help fund operations, and spending often is dictated by an average of three or five years of returns.
Endowments focus on long-term investing, so one quarter or one year often won’t have large implications. Yet most university funds in fiscal 2016 were handed their first losses since the 2009 recession, when the funds declined a median 21.8 percent.