Key Takeaways
- • Princeton's endowment returned 3.9 percent for fiscal year 2024 (ending June 30), the lowest among Ivy League peers, significantly underperforming Harvard's 9.9 percent, Columbia's 11+ percent, and Brown's 11+ percent returns.
- • Overallocation to venture capital—an asset class that underperformed during the period—combined with insufficient exposure to U.S. equities, particularly technology stocks, drove Princeton's weak performance while the S&P Information Technology sector surged 41.8 percent.
- • Princeton's $34.1 billion endowment return of 3.9 percent fell below both its internal 6 percent expected return benchmark and the global 70/30 benchmark return of 14.2 percent, representing the second consecutive year of Ivy League lagging performance.
- • Yale's $41.4 billion endowment posted the second-lowest return among peer institutions at 5.7 percent net of fees, suggesting structural portfolio allocation challenges affected multiple elite endowments similarly positioned in venture capital and away from technology exposure.
- • Princeton maintains a 8 percent target allocation to emerging markets equities, slightly above the Ivy League average of 6 percent, indicating deliberate but underperforming positioning in this asset class during the fiscal year.
Summary
Princeton University's $34.1 billion endowment delivered its weakest performance among Ivy League institutions for the fiscal year ending June 30, 2024, returning only 3.9 percent—a result that exposes significant portfolio allocation misalignment during a period of exceptional technology stock appreciation. The return marked a dramatic underperformance relative to peer institutions, with Harvard's endowment posting a 9.9 percent return, while Columbia and Brown each exceeded 11 percent. According to Markov Processes International analysis, Princeton's performance represented the lowest among elite endowments tracked by the firm, underscoring the magnitude of the allocation problem.
Princeton's strategic positioning away from domestic equities proved particularly costly given the exceptional performance of the technology sector. The S&P Information Technology sector surged 41.8 percent during fiscal 2024, building on a 40.3 percent gain in the preceding fiscal year. Meanwhile, venture capital investments—a significant component of Princeton's portfolio—underperformed expectations during the measurement period. The endowment's 3.9 percent return fell substantially below the institution's internal 6 percent expected return benchmark and lagged the global 70/30 stock-bond benchmark by 1,030 basis points, which returned 14.2 percent for the fiscal year.
The underperformance follows a troubling fiscal 2023 in which Princeton posted a 1.7 percent loss, leaving it at the bottom of the Ivy League rankings, though still ahead of MIT's 2.9 percent loss during that period. This consecutive year of relative underperformance suggests structural portfolio allocation decisions rather than cyclical underperformance. Yale's $41.4 billion endowment, the final Ivy League institution to report results, delivered 5.7 percent net of fees, the second-lowest return among the peer group, indicating that venture capital overweighting affected multiple elite institutions simultaneously.
MPI's analysis attributes Princeton's weak returns explicitly to portfolio overallocation to venture capital and emerging markets equities while maintaining insufficient exposure to U.S. equities, particularly the technology sector that drove market gains. Princeton's target allocation to emerging markets equities stands at 8 percent, slightly above the Ivy League average of 6 percent, further suggesting deliberate positioning that failed to capture the outperformance of domestic equity markets during the fiscal year.
Princeton's strategic positioning away from domestic equities proved particularly costly given the exceptional performance of the technology sector. The S&P Information Technology sector surged 41.8 percent during fiscal 2024, building on a 40.3 percent gain in the preceding fiscal year. Meanwhile, venture capital investments—a significant component of Princeton's portfolio—underperformed expectations during the measurement period. The endowment's 3.9 percent return fell substantially below the institution's internal 6 percent expected return benchmark and lagged the global 70/30 stock-bond benchmark by 1,030 basis points, which returned 14.2 percent for the fiscal year.
The underperformance follows a troubling fiscal 2023 in which Princeton posted a 1.7 percent loss, leaving it at the bottom of the Ivy League rankings, though still ahead of MIT's 2.9 percent loss during that period. This consecutive year of relative underperformance suggests structural portfolio allocation decisions rather than cyclical underperformance. Yale's $41.4 billion endowment, the final Ivy League institution to report results, delivered 5.7 percent net of fees, the second-lowest return among the peer group, indicating that venture capital overweighting affected multiple elite institutions simultaneously.
MPI's analysis attributes Princeton's weak returns explicitly to portfolio overallocation to venture capital and emerging markets equities while maintaining insufficient exposure to U.S. equities, particularly the technology sector that drove market gains. Princeton's target allocation to emerging markets equities stands at 8 percent, slightly above the Ivy League average of 6 percent, further suggesting deliberate positioning that failed to capture the outperformance of domestic equity markets during the fiscal year.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.