Vandy offers details on endowment losses

Summer move into cash helped limit drop to 'only' $600M

Email | Print By Geert De Lombaerde

Vanderbilt University officials this morning shed a little more light on the losses posted by its endowment in the second half of 2008.

Matthew Wright, vice chancellor for investments, said the endowment lost 16.5 percent of its $3.5 billion value from July to Dec. 31, the first six months of Vanderbilt’s fiscal year.

That number is a good bit less than the 30 percent Provost Richard McCarty first floated late last month. Soon after, other officials said the real figure was closer to the national average for university endowments. That number was around 23 percent.

That Vanderbilt’s $600 million in losses – which played a major role in the university having to cut costs, freeze salaries and put construction projects on hold – have been relatively smaller than its peers’ is due in part to a summer shift in investment strategy. Wright said his team began a "significant" move out of stocks and into cash and other “liquid securities.”

“We were fortunate to defensively position the portfolio prior to the market decline,” Wright said. “We’re poised very well to navigate this environment.”