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Duke University Endowment Fund

Name: DUMAC, Inc. (Duke University’s Endowment Fund)

Assets Under Management: $6 Billion (Source: Duke University on 8/6/2014)

Annual Report: Duke University Endowment Fund’s Annual Snapshot

Portfolio Insights:The mission of Duke University’s endowment is to support the people, programs, and activities of the university in perpetuity. Over the years, growth of the endowment through investment return and charitable giving has enabled the university to provide scholarships and fellowships to students, build faculty excellence, launch new programs and research efforts, and support a wide range of important needs.

Duke’s endowment assets are managed collectively. Much the way individual investors pool their assets in a mutual fund, each of the individual funds comprising the university’s endowment owns units in Duke’s Long Term Pool (LTP).  The Long Term Pool is managed by DUMAC Inc., a professionally staffed investment organization controlled by Duke University.” (Source)

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Top Duke University Endowment Fund (DUMAC, Inc.) Headlines:

1) DURHAM, North Carolina — A $20 million endowment gift from Duke University Trustee Melinda French Gates and her husband, Bill Gates, will launch a pioneering academic program expanding teaching and research across traditional disciplinary boundaries, university President Nannerl O. Keohane announced Saturday. Keohane said she expects the new University Scholars program, which also will strengthen financial aid to students, to become known “as one of Duke’s most distinctive achievements. The Scholars will exemplify our bold commitment to intellectual risk-takers and to crossing disciplinary boundaries in the search for truth.” A principal goal of the University Scholars program, which will begin in the fall of 1999, is to identify intellectually gifted undergraduate, graduate and professional students and provide them with the resources, curricular freedom and extracurricular forums for cross-fertilizing each other’s ideas in creative and novel intellectual collaborations, officials said. (Source)

2) A group of students clutching more than 2,000 petitions knocked on the door of the Duke University Board of Trustees meeting and requested an audience. Burly security guards barred the door on the order of vexed University President Richard Brodhead. Brodhead, visibly nervous, tried to usher the students out, calling their presence an “interruption.” Undeterred, the group resisted, asking for a chance to present the proposal they had spent almost a year crafting. The president, adamant in his refusal, returned to the meeting and shut the door.  Despite the hostile reception, a modified version of the students’ proposal—which called for the overhaul of the university’s guidelines on investment responsibility—had already found its way onto the board’s agenda. On October 4, 2013, the trustees voted to adopt the new guidelines, expanding the university’s investment oversight committee and establishing a special fund within the endowment—a Social Choice Fund—which will be invested only in prescreened, socially responsible funds. (Source)

3) Durham, NC – DUMAC, Inc. achieved a 1.0 percent return on Duke University’s endowment and other investments for the fiscal year ending June 30, 2012, bringing the endowment total to $5.6 billion, according to the university’s latest annual financial report, which was made public Tuesday.  The return compared favorably to the -1.1 return for a portfolio used by the university as a benchmark for its own long-term investment pool. As a result of favorable investment returns and new gifts, the university’s endowment has largely recovered from losses it experienced during the financial downturn, including a drop of more than 25 percent in FY2009.

In FY2011, DUMAC achieved a 24.5 percent return on investments. This past year, the market value of the university’s endowment declined slightly even though the investment returns were positive. This occurred because of planned distributions in support of university operations.  Each year, Duke allocates approximately 5.5 percent of the average value of its endowment over the three previous calendar year-end totals to support designated ongoing operations. (Source)

4) Duke beats Harvard Performance:  Duke University said its investments rose 13 percent in the past year, beating gains of Harvard University, the world’s richest school, and matching returns of a broad group of institutions. The endowment is still $1.2 billion short of what it was two years ago, said Richard Brodhead, the Durham, North Carolina, school’s president, in an e-mail to staff today, without disclosing current the value of the fund. The endowment managed $6.1 billion as of June 30, 2008, according to its website. It was valued at $4.4 billion a year ago. Duke cut 400 workers in the past year through early retirement packages, by controlling overtime and not filling vacant positions, Brodhead said. Freezing salaries helped save more than 100 jobs, he said. That contributed to a reduction in the budget deficit of more than $60 million. (Source)

5) DukeOpen, a new student coalition, aims to increase transparency of the Duke’s endowment.  Duke’s investments are not openly available, but by increasing transparency of fund usage, DukeOpen aims to encourage the University to instate more socially responsible investment policies. The group has created a proposal advocating for the Board of Trustees to make periodic reports to the Duke community about how the University’s money is being invested. They also propose support features such as creating an assistant vice president for investment responsibility. (Source)

About Richard C. Wilson