University of Pennsylvania Endowment Returns 7.1%

The University of Pennsylvania’s Office of Investments, the entity which manages the university endowment, announced Monday that it achieved a 7.1% return in fiscal 2024.

Assets of the fund, primarily comprised of the Associated Investments Fund, increased by $1.4 billion to $22.3 billion at the end of June, under CIO Peter Ammon, formerly of Yale University.

Like many of its peer Ivy League endowments, Penn has adopted the Yale model, which includes larger allocations to alternative investments like private equity. For many endowments, this model has resulted in outperformance in the long term; however, these endowments had muted returns in the two previous fiscal years.

Of its Ivy League peers, Penn’s endowment had the second lowest return in fiscal 2023 at 1.3%, above Princeton’s negative 1.7% return. In fiscal 2022, the endowment’s return was flat at exactly 0%.

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Penn’s returns trail its Ivy League peers who have reported their endowment returns for fiscal 2024. Brown University’s endowment reported an 11.3% return, Columbia returned 11.5%, and Dartmouth returned 8.4%.

According to Penn’s annual report, the endowment allocated 34.7% of its assets to private equity, 12.8% to equities, 19.2% to absolute return, 11.5% to real assets, 5.4% to debt securities and 4.4% to cash and cash equivalents.

The endowment has returned an annualized 2.7%, 9.6%, 8.7% and 8.4% over the past three-, five-, 10- and 20-year periods, respectively.

Approximately $17.6 billion of the endowment represents assets that support the university, while the remaining $4.8 billion represents assets that support the University of Pennsylvania Health System.

The endowment provides Penn with 19% of the university’s academic budget, and it distributed $1.1 billion in fiscal 2024 to support university operations. The endowment has distributed $6.7 billion to the university over the past decade.