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During FY 2000, the University's total endowment assets grew by $270 million or 18% to just under $1.8 billion. The increase is attributable to contributions to endowment during the year of $156.5 million and asset appreciation of $113.5 million. The number of individual endowments accounted for in the asset value above increased during FY 2000 by 14% to a total of 2,319 at year-end. The vast majority of these assets are managed in a commingled fund known to the Hopkins community as the Endowment Investment Pool or EIP. The value of the EIP at June 30, 2000 was just over $1.80 billion, an increase of $330.5 million from the previous fiscal year. Over the past five years, the Johns Hopkins Initiative, which officially ended June 30, 2000, generated over $448.6 million in new endowment assets. Combined with asset appreciation of $483.1 million, the University's total endowment, which stood at $838.2 million at the end of FY1995, has more than doubled. The University's endowment distributed $71.6 million in payout support in FY 2000 representing 5.4% of the three-year average EIP market value. Strong performance from the EIP's investments over the past several years has provided the University's Board of Trustees' Committee on Investments, which oversees EIP investment and payout policies, with increased flexibility in raising the amount of the payout each year. In fact, the dollar amount of the annual payout has never declined. The Board of Trustees' Committee on Investments has taken major steps over the past five years to increase the EIP's exposure to more aggressive asset classes such as large-capitalization growth stocks, emerging market stocks, and alternative investments. As a result, the EIP has achieved a five-year compound average annual return for the period ending June 30, 2000 of 16.1% contrasted with a five-year return of 10.4% for the preceding five-year period when the overall EIP asset allocation was heavily weighted toward value stocks and fixed income.
FY 2000 was a very active and successful year in terms of asset repositioning. In an effort begun in FY 1998, the Committee on Investments approved $84.5 million in commitments to 10 new venture capital and private equity partnerships during FY 2000. These partnerships invest primarily in the securities of non-public companies in all stages of development from start-up transactions to companies nearing their initial public offerings. Although the University is still considered in the early stage of filling out its allocation to this asset class, the one-year combined return from this group of investments through June 30, 2000 of 54.1% made a very significant contribution to the overall one-year EIP return of 14.4%. The most notable action taken by the Committee on Investments in FY 2000, however, was the decision to invest $90 million in three marketable alternative fund-of funds portfolios. These managers invest in the portfolios of other investment managers who use a variety of non-traditional "absolute return" strategies. The most important benefit expected of these investments is their low or negative correlation to the established markets. While equity-like performance is possible with these funds, their ultimate objective is to dampen the impact of market declines and reduce the incidence of outright negative returns. The EIP's allocations to traditional equity and fixed income managers were reduced in order to fund the investments in the marketable and non-marketable alternative strategies. This can be seen clearly in the asset allocation table shown above. Despite the increased investment in alternative strategies, however, the performance of the traditional investment classes still determined the overall performance of the EIP during the past year. Most of the EIP's return in FY 2000 is attributable to the performance of the EIP's domestic and international equity managers. Five of the six EIP domestic equity managers equaled or outperformed the 7.2% annual return of the S&P 500 Index and the international equity managers as a group, including the two emerging markets managers, posted a return almost twice that of the MSCI EAFE Index return of 17.2%. FY 2000 was a very difficult year for most fixed income managers due to a rising interest rate environment and increasing yield spreads. As a result, the Lehman Brothers Government/Corporate Bond Index could only produce a 4.3% return for the year and only one out of the three EIP bond managers was able to outperform the index. |
NITZE SCHOOL OF ADVANCED INTERNATIONAL STUDIES
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Internships
and fellowships funded by campaign commitments have brought more and
broader opportunities to students at the Nitze School of Advanced International
Studies, where one-fourth of Initiative funds support student financial
aid. Andrew Reed, SAIS 2000, for example, used a substantial grant
from an individual donor to help set up a yogurt manufacturing business
in the Republic of Georgia. Meanwhile, students in SAIS's new Southeast
Asia studies program–launched with campaign gifts–are
gaining invaluable experience as interns in the business and government
sectors of Thailand, Cambodia, Vietnam, the Philippines, Singapore,
and Hong Kong. The increase in student aid has also allowed SAIS to
enroll more students from Central and Eastern Europe, Southeast Asia,
and other emerging economies.