Asset AllocationNovember 4, 2022

UNC, NC State Endowments Killed It in Fiscal 2022

Returns of 4.4% and 3.2%, respectively, for the Tarheels and Wolfpack are among the best in the U.S. for the year ended June 30.

Reported by Michael Katz

The endowments of the University of North Carolina and North Carolina State reported returns of 4.4% and 3.2%, respectively, for the fiscal year ended June 30. While the gains seem modest at first glance, they are among the top performances in the country during a volatile fiscal year when endowment and foundations reported a median loss of 7.8%, according to Cambridge Associates.

The 4.4% return from the UNC investment fund, led by Chief Investment Officer Jonathon King, outperformed global public equity markets by more than 20%, and easily beat its benchmark’s 0.1% return. The endowment also reported three-, five-, and 10-year annualized returns of 14.9%, 12.9%, and 11.0%, respectively, outperforming its benchmark, which returned 10.7%, 9.5%, and 8.6% over the same time periods.

According to UNC Management Company, the endowment’s target asset allocation is 28% in long equity, 25% in private equity, 15% in long/short equity, 10% in diversifying strategies, 8% in fixed income, 8% in real estate, 4% in energy and natural resources, and 2% in cash.

Meanwhile, the 3.2% return produced by North Carolina State’s endowment, led by CIO Chris Ip, raised its market value by approximately $64.8 million to $1.66 billion. This blew away its benchmark’s portfolio, which lost 9% during the fiscal year.

The NC State endowment also reported three-, five-, and 10-year annualized returns of, 13.7%, 11.9%, and 10.6%, respectively. This significantly outperformed the endowment’s benchmark portfolio, which returned 6.8%, 6.7%, and 7.2%, respectively, over the same time periods. The endowment also said the portfolio’s market value has increased at a compounded annual growth rate of 15.4% over the past 10 years.

The asset allocation for the NC State endowment is 33% in long biased equity, 22% in private equity, 15% in long/short equity, 11% in fixed income, 6% in real estate, 6% in diversifying strategies, 5% in energy and natural resources, and 2% in cash.