THE DU ENDOWMENT
The University of Denver's endowment is essential to sustaining academic quality because it provides a guaranteed source of income to support the University. Donors who contribute to the endowment have a positive impact on students and academic programs in perpetuity.
IMPACT OF ENDOWED FUNDS
Establishing an endowment is an act of great generosity and vision. By creating an endowed fund, it means that you recognize the importance of supporting the institution not only during your lifetime, but for generations to come. You are among the visionary individuals, families, and organizations who have helped to build an extraordinary resource for the University. While we can measure the Endowment's annual fiscal impact in an annual report, the impact that your gift will make in perpetuity is immeasurable.
The University of Denver's investment philosophy is to maximize return on assets by exercising an appropriate level of risk; providing income for the benefit of our students and honoring a donor's intent for the gift and growth of their investment into perpetuity.
The University manages stock market volatility by maintaining a diversified portfolio, which includes stocks, bonds, absolute return, real estate, venture capital, and other investments. However, diversification alone will not prevent the endowment from sustaining losses during market downturns.
DU's endowment distribution policy insulates its budget from short-term fluctuations in the financial markets by using a conservative spending rate formula. This approach helps the University budget maintain consistency for its revenue streams.
These funds are pooled for investment to contain costs and maximize returns. A separate accounting is maintained for each separate endowed fund to track growth, expenditures, and additional contributions—thereby preserving the identity and purpose of each fund. The investment pool is overseen by the University's Investment Committee, which employs the services of Monticello & Associates, a leading investment consulting firm, to provide advice regarding asset allocation and the selection of professional investment managers. Earnings in excess of the amount expended from each fund (a maximum of 4.5%) are retained in the fund to provide the basis for continued growth. Endowment gifts are prudently invested according to the University's Investment Policy.
The University of Denver's endowment spending policy currently allows up to 4.5% of an individual endowment fund's market value to be distributed annually for its designated use, with any excess returns reinvested for long-term growth. The majority of these funds include true endowment, gifts restricted by donors to provide long-term funding for designated purposes. The remaining represent quasi-endowment, monies that the University chooses to invest and treat as endowment.
Donors frequently specify a particular purpose for gifts, creating endowments to fund professorships, teaching, and lectureships; scholarships, fellowships, and prizes; and maintenance, books, and miscellaneous specific purposes. Although distinct in purpose or restriction, endowment funds are commingled in an investment pool and tracked with unit accounting much like a large mutual fund. Endowment gifts of cash, securities, or property are valued and exchanged for units that represent a claim on a portion of the whole investment portfolio.
Frequently asked questions about DU's endowment
Thank you for your meaningful investment in the University of Denver. Our goal is to ensure you are receiving accurate and informative communication regarding your endowed fund. Please take a moment to complete our online survey to better inform of us of how we are doing. We welcome your thoughts on how we can best communicate the impact of your philanthropy.
ADDITIONAL QUESTIONS? CONTACT ADVANCEMENT AT DONORRELATIONS@DU.EDU OR 303.871.4591