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Bailey McCann, Opalesque New York: 2022 was a tough year for endowed funds, according to new data from Commonfund. Commonfund surveyed 277 foundations and found that investment returns declined across the board in 2022.
The average 2022 calendar year return on endowed funds for the 171 private foundations participating in the Study was -12.0 percent, a marked decline from the 16.3 percent return private foundations reported for 2021. Similarly, for the 106 participating community foundations, the average 2022 return was -13.3 percent compared with 14.8 percent in 2021. The average year-over-year declines were the largest for participating foundations of both types since 2008, a year buffeted by the financial crisis and the Great Recession.
Long-term returns also took a hit. According to Commonfund data, private foundations' 10-year average annual returns declined to 7.3 percent in 2022 from 9.7 percent in 2021; Ten-year returns for community foundations fell to 6.4 percent from 9.2 percent a year ago.
The drop in returns can also be seen in the intermediate time horizon. Private foundations' average return for the past three years was 5.6 percent, down from 16.0 percent in 2021, while community foundations' average return for the period was 4.4 percent compared to 15.2 percent a year ago, according to Commonfund data. High returns in 2021, were shown in the data to be evening out returns from 2020 and 2022, which were lower.
Foundations have largely maint...................... To view our full article Click here
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