The primary policy benchmark for most respondents is a static-weighted blend of indexes where the weightings align exactly or closely with the asset classes and target percentages specified in the asset allocation policy. Perhaps the most consequential benchmarking choice in recent years has been how to represent private equity in the policy benchmark. The majority of respondents use a public index for that representation, and this cohort by and large saw significant underperformance versus their benchmark in 2024. Our Benchmarking section summarizes the various approaches that endowments use for benchmarking total portfolio performance and compares endowment performance versus policy benchmark returns.

There have been some minor shifts in endowment asset allocations in recent years that have diverged from longer-term trends. For example, over the last couple of years, average allocations to public equities have increased, while those to private equity and venture capital (PE/VC) have declined. However, these shorter-term changes seem to be driven by market dynamics where strong performance from public equity markets has naturally lifted those allocations within portfolios. When it comes to looking at data from an asset allocation policy perspective, the number of endowments decreasing their long-term target to public equity was three times as many as the number that reported an increase. The Asset Allocation and Implementation section covers this and other topics, such as the number of external investment managers and the types of investment vehicles (e.g., active versus passive) used.

The net flow rate considers the combined impact of inflows and outflows on the endowment portfolio’s overall growth. Because part of annual spending is offset by new gifts, portfolio growth over time is much greater than it would be based on performance after spending alone. In fact, for this year’s survey group, median portfolio growth over the last decade was 30% higher than it would have been if there were no inflows. Our Institutional Support section contains analysis on this and other statistics related to the financial support that C&Us receive from their endowments.