Despite missing the boat on Google, the rate of return on Bowdoin's endowment last year far exceeded the average return of the 746 schools that participated in this year's survey by the National Association of College and University Business Officers (NACUBO).
The survey, issued in late January, reported an average investment return of 9.3 percent for the 2005 fiscal year. According to Vice President for Investments Paula Volent, Bowdoin's rate of return was 13.6 percent.
Volent was pleased by Bowdoin's performance.
"For our peer group we did exceedingly well," she said.
Volent explained that natural resources, emerging markets, and internet powerhouse Google were the three primary drivers of collegiate endowment performance this year. While she said the College had good exposure to oil and gas as well as emerging markets such as South Korea and India, Bowdoin had no venture capital money in Google, which has made significant gains since its initial public offering in 2004.
Volent attributed the College's growth to success in picking talented fund managers to invest with.
"We don't invest in stocks and bonds here, we invest in managers. Everything that Bowdoin invests in is run by external managers who are experts in their fields," Volent said.
"My job is to do tons of research on the big picture, on what the opportunities are like, and where are there inefficiencies where Bowdoin can come in. I'll try to find the smartest managers that really know what they are doing, that are aligned with our incentives," she said.
The market value of Bowdoin's endowment at the conclusion of the fiscal year, ending June 30, was $578 million, up from $514 million the previous year. This $64 million, or 12.4 percent, increase resulted from investment returns, $11.8 million in gifts, and deductions to support the College's budget.
The College's endowment per student ended the year at $346,024. This number bested the approximate $290,000 average among 13 peer colleges, Volent said.
The total value of the endowment has more than doubled in the last decade since it totaled $223 million in 1995.
The endowment contributed $21.4 million to educational spending, providing 22.5 percent of the College's $96 million budget. Bowdoin's endowment spending rule requires that five percent of the endowment's three-year average value be put towards educational spending each year. The rule is designed to provide relatively consistent revenue to the budget in spite of yearly market fluctuations.
Yale University led with a 22.3 percent rate of return on its endowment. Volent, who received her master's in business administration from Yale, was a senior associate at the Yale Investments Office before coming to Bowdoin.
Harvard's endowment remained the largest, totaling more than $25 billion.
Other Maine schools fell short of Bowdoin's investment assets. Colby College boasted an endowment of $424 million, while Bates College ended the year at $208 million.