Page 7 - Caltech Endowment Brochure_FY19

CALTECH ENDOWMENT REPORT 2019 CALTECH ENDOWMENT REPORT 2019
Growth of the Total Endowment
The market value of Caltech’s total endowment
investment portfolio increased to nearly $3.0 billion as FY19:
of the close of fi scal year 2019. This increase was made
possible by generous giving to endowed funds and
strong performance from our real estate, private equity, $72M
and alternative securities asset classes. New gifts and
Barbara Wold (PhD ’78), Bren Professor of investment gains were partially offset by endowment
Molecular Biology, is the newly appointed distributions. Since the end of fi scal year 2009, the increase in total
director of the Richard N. Merkin Institute for beginning of the recovery from the 2008 fi nancial crisis,
Translational Research at Caltech. The institute Caltech’s total endowment value (net of outfl ows) has endowment
was launched in May with a Break Through grown at a compound annual rate of nearly 7.1 percent
campaign gift from trustee Richard Merkin.
and has supported Caltech’s research programs and
people with almost $1.2 billion in payout.

$3,100
$3,000
$2,900 $2,998
$2,800 $2,926
$2,700
$2,600
$2,500 + 97.8% $2,655
$2,400
$2,300
$2,200 $2,261
$2,100 $2,125
$2,000 $2,138
$1,900 $1,982
$1,800 $1,826
$1,700 $1,653
ENDOWMENT PERFORMANCE, FISCAL YEAR 2019 $1,600 $1,637 TOTAL ENDOWMENT IN MILLIONS
$1,500
$1,516
Endowment Investment Pool Return 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Total endowment includes the investment pool and separately invested endowments.
As illustrated in the fi gure below, Caltech’s September 30, 2019, investment pool returns beat
endowment investment pool generated a 5.4 their benchmarks by 2.9, 2.1, and 1.7 percentage
percent return for fi scal year 2019, exceeding its points, respectively. Over the last fi ve years, the Asset Class Allocation and Performance
benchmark policy portfolio by 3.0 percentage points. added value generated by this outperformance of the Caltech’s private equity portfolio (which includes infrastructure losses caused by the rapid decline in
For the three-, fi ve-, and 10-year periods ended policy portfolio was nearly $250 million. both buyout and venture capital funds) performed oil prices. The overall alternative securities market
well during fi scal year 2019, delivering a 14.5 percent struggled during the 12 months ended September
return and beating its benchmark by 2.9 percentage 30, 2019. (The HFRI Fund of Funds Composite Index
15% points. In real assets, our real estate portfolio provided return was down 0.1 percent.) Despite this weakness,
14% solid performance, up 8.7 percent and beating its our alternative securities portfolio fared well, up 2.7
13% benchmark by 2.6 percentage points; however, percent and beating its composite benchmark by 2.3
12% LAST FIVE YEARS: this was more than offset by private energy and percentage points.
11%
10% 10.2%
FY 2019
9% $148M Allocation FY 2019 Asset Benchmark Returns
Class Returns
8% 8.3% (as of September 30, 2019)
7% 7.3% 7.5% 7.3% 7.4% Global developed markets equities 25% −0.9% 1.8%
6% 6.6%
5% 5.4% 5.2% 5.3% in fi nancial aid Emerging markets equities 10% 3.0% −2.0%
4% from endowment Alternative securities 27% 2.7% 0.4%
3%
2% 2.4% 2.7% Private equity and venture capital 18% 14.5% 11.6%
1% Real assets* 12% −5.8% −2.6%
0
1 YEAR 3 YEAR 5 YEAR 10 YEAR
Global fi xed income 1% 1.0% 9.7%
Endowment investment Policy portfolio annualized Cambridge Associates college Cash and other 7% 2.4% 2.4%
pool annualized return benchmark return and university median return
5 * Primarily real estate, energy, and commodities 6