IMCO Returned 9.9% in 2024 | Chief Investment Officer

The Investment Management Corp. of Ontario, an entity that manages assets for public sector clients in Ontario, announced Wednesday that the fund returned 9.9% in 2024.

The institutional investor’s assets under management grew to C$86 billion ($62 billion), up from C$77.4 billion at the end of 2023.

The fund’s returns were primarily driven by public and private equity, with the two asset classes returning 24.2% and 16.4%, respectively. Fixed income, the asset class with the largest allocation at IMCO, was flat for the year.

Global credit returned 8.1% during the year, and global infrastructure returned 8%. Real estate was the fund’s only asset class reporting a loss, falling 0.8% in 2024.

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“We believe that helping our clients select the optimal asset mix, while avoiding market timing, big bets and unnecessary complexity, and pursuing outperformance in a very targeted way, positions us to effectively navigate an uncertain environment for our clients,” said Rossitsa Stoyanova, IMCO’s CIO, in a statement.

IMCO allocates 24% of its assets to fixed income, 23% to public equities, 14% to real estate, 13% to infrastructure, 11% to private equity, 10% to global credit, 3% to money markets and “other,” and 2% to public market alternatives.

“While we don’t measure success based solely on one-year returns, we are pleased with our 2024 results. They reflect the strength of our disciplined, long-term approach to investing,” said Bert Clark, IMCO’s president and CEO, in a statement. “We avoid unnecessary complexity and focus on building well-diversified, cost-effective portfolios for our clients, with strong liquidity management.”

AIMCo Achieves 12.3% Return in 2024

Ontario Teachers’ Nets 9.4% Return, Assets Grow to $185.5B

Tags: Bert Clark, Canada, IMCO, Investment Management Corporation of Ontario, Rossitsa Stoyanova

Universities with large allocations to private markets are borrowing in the bond market to address funding issues, as private equity capital calls can compete with research funding for liquidity.

Harvard University announced Tuesday that the institution will issue $750 million in taxable bonds, following a $450 million offering last month. The issuance comes as private markets investments have generated weaker returns and large universities are facing federal funding cuts.

A task force from the administration of President Donald Trump is reviewing $9 billion in federal grants to Harvard and gave the university a list of demands that would allow it to escape a funding freeze.

“As part of ongoing contingency planning for a range of financial circumstances, Harvard is evaluating resources needed to advance its academic and research priorities,” a spokesperson for the university said in a statement.

Trump has already cut or announced plans to cut hundreds of millions in university funding: $175 million to the University of Pennsylvania has been frozen, as well as $400 million to Columbia University. Approximately $510 million in federal grants for Brown University are also expected to be frozen.

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Harvard is not the only institution turning to the municipal bond market to access liquidity. In an April 1 notice to investors, Princeton University announced it is considering the sale of $320 million of taxable bonds, with the proceeds to be used for general corporate purposes.

Stanford University announced in February that it would sell $327 million worth of bonds, and the University of Pennsylvania also tapped the municipal bond market in January.

But universities are not only facing funding cuts. Their endowments, which fund a significant amount of their spending, have posted lackluster returns in recent years, largely due to these institutions’ large allocations to private markets. Federal cuts could further constrain these institutions’ liquidity needs.

Weak Private Markets Returns

Many large university endowments have significant allocations to private markets. The Harvard endowment, for example, allocated 39% of its portfolio to private equity and another 31% to hedge funds, as of the university’s 2023 fiscal year. It only had an 11% public equity allocation. According to Markov Processes International’s transparency lab, private equity accounts for 37% of assets under management across the Ivy league, MIT and Stanford.

One short-term benefit is that these high allocations to the private markets may insulate these endowments from the volatile equity market. It is unclear how much Wednesday’s rally in U.S. public equities offset paper losses these funds have experienced so far in 2025.

Smaller endowments are more likely to have a heavy allocation to public markets. According to the National Association of College and University Business Officers, the best-performing endowments for fiscal 2024 were also the smallest ones, because they tended to have a larger allocation to public markets.

Endowments with less than $50 million in assets under management returned an average of 13% in fiscal 2024, while endowments with more than $5 billion in AUM returned 9.1%, according to NACUBO.

The best-performing university endowment in fiscal 2024 among institutions with at least $1 billion in AUM, according to NEPC, was the UC San Diego Foundation, with a 15.5% return. For the fiscal year, the endowment held 64.8% of its portfolio in equities, driving 90% of the fund’s returns.

The worst-performing endowment was the Princeton University Endowment, managed by the Princeton University Investment Co., with a 3.9% return.

While endowments with higher allocations to private market assets have underperformed in recent years, they have outperformed over longer periods of time.

But these endowments must now deal with the recent pullback in the equity markets: The S&P 500 Index is down 7% year-to-date, and was down as much as 25% this year, and while public markets performance will have a pronounced effect on those endowments with equity-heavy portfolios, it could also squeeze what little liquidity larger endowments have left.

Endowments With the Most Liquidity, Funding Risk

According to MPI, Columbia and Cornell University are the most vulnerable Ivy League institution to federal funding freezes and have the highest government funding risk, which MPI calculates as the ratio of fiscal 2024 grants to the liquid portion of the endowment’s portfolio, against an endowment’s liquidity risk, the ratio of unfunded private equity commitments to the liquid portion of a portfolio.

Despite the two institutions having among the lowest private markets allocation, Columbia and Cornell are the most reliant of their peers on federal grants: Government funding as a percentage of endowment AUM at the two institutions was 9.1% and 7.85%, respectively, according to MPI.

Source: Markov Processes International

Brown University has the highest liquidity risk among its peers, according to MPI, and the highest ratio of unfunded private equity commitments, suggesting the endowment, which has a 27% allocation to private equity, has the youngest average vintage, which could result in a lower level of near-term distributions.

“PE liabilities extend over several years—even if no new commitments are made. At first glance, these two funding streams may seem unrelated,” according to MPI. “However, analyzing them together is crucial because if grants are not received, PE capital calls and research funding must compete for liquidity.”