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Princeton University Endowment Fund

Name: Princeton University Investment Company (PRINCO)

Assets Under Management:  $19.7 Billion (Source: Princeton University on 3/31/2014)

Princeton pie

Portfolio Allocation Insights:

“If [Princeton is] going through some economic recovery, one of the asset classes that will likely benefit is equities,” said Won. “So it’s not uncommon for endowments to start decreasing their holdings in fixed income and increase equity holdings. (Source)

Management Team:

Team Member Title
Andy Golden President of PRINCO
Carolyn N. Ainslie VP for Finance and Treasurer
Heidi G. Miller Chair, Committee on Finance, Board of Trustees
Shirley M. Tilghman President of the University

Contact Details:  For complete contact details for the Princeton Endowment Fund investment staff please access your copy of our Endowment Database.

Background on the Princeton Endowment Fund:

Princeton University increased its value by $1.2 billion compared to the year before increasing the 10-year expected return. With the increase in return the university is putting the money towards providing its students with very generous financial aid packages, instead of putting that money into a new investment. The “scholarship budget has grown to $121.4 million this year, and about 60 percent of undergraduates receive financial aid. Princeton’s scholarship spending has outpaced fee increases for a decade, and the average “net cost” for Princeton students today is lower than it was in 2001, even before adjusting for inflation” (Source)

 

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Top Princeton Endowment Fund Headlines:

1) Princeton University paid four of its endowment managers a combined $9.2 million in 2013, a 46 percent increase from a year earlier and four times the increase Harvard University paid its top investors. Andrew Golden, the president of Princeton University Investment Co., the company known as Princo that manages the school’s $18.2 billion endowment, collected $3.9 million in total compensation last year. The 55-year-old’s remuneration included a 94 percent increase in retirement and deferred compensation and a 48 percent jump in bonus pay, according to the university’s latest tax return. “It’s easy to whack these guys,” Charles Skorina, founder of a San Francisco-based executive search firm specializing in investment management, said by phone. “It looks big in percentage terms, but it’s a basis point or two compared to the endowment.” The endowment returned 11.7 percent last year, matching the average return posted by endowments greater than $1 billion, according to the National Association of College and University Business Officers and Commonfund Institute’s 2013 endowment study. (Source)

 

2) The Princeton University Investment Company, which manages the University’s endowment, has slightly adjusted its allocations to include a higher percentage of investments in comparatively more liquid assets. The new financial management strategy, called “Princeton Prime,” was disclosed in an annual report on the endowment prepared by the Office of the Treasurer. In addition, the Report of the Treasurer explained that the endowment, despite its growth, had responded to the economy’s recovery more slowly than the market as a whole in recent years. “We would have done better this year if we had kept [our asset allocation strategy] simple,” the report read. “Indeed, ‘simple’ has beaten ‘complex’ over the most recent five-year span. But focusing on ‘this year’ and ‘most recent’ is no way to design a long-term investment program.” PRINCO manages $17.8 billion of the university’s $18.2 billion endowment. (Source)

About Richard C. Wilson