The University Record, July 10, 1995

ENDOWMENT FUND REPORT

The University Endowment Fund is an investment pool for hundreds of endowment funds and funds functioning as endowment. As with a mutual fund, purchase, redemptions and distributions are all calculated based on a participant's share holdings. The fund is valued at $1.2 billion. It is invested in a highly diversified portfolio of stocks, bonds, mortgages, real estate, oil and gas, reorganization investments, venture capital and cash instruments.

This brief report is to inform University Endowment Fund participants of the market value of their shares and their distributions per share. It also provides information on the investment performance of the fund. The investment results shown represent total return, which includes both ordinary income and capital gains (losses).

This report is intended to communicate information on total returns of which distributions are a part. Distributions are made at 5.5 percent of the 12-quarter average share value. The other component of return--reinvested capital gains and, to the extent available, reinvested income--is essential to protecting endowment gifts and endowment distributions against inflation.

The University's investment managers are:

Common Stock Managers

Capital Growth Management; The Common Fund Emerging Markets Fund; Gran-tham, Mayo, Van Otterloo & Co.; Trinity Investment Management Corp.; Marathon Asset Management Ltd.; Marvin & Palmer Associates Inc.

Tactical Asset Allocation Manager

First Quadrant Fixed Income Managers

The Common Fund Global Bond Fund; Lowe, Brockenbrough & Tattersall Inc.; STW Fixed Income Management Inc.

Investment Management Consultant

Cambridge Associates Inc.

Shareholder's Report March 31, 1995

Goal: To protect distributions and share value against inflation.

Market value per share

June 30, 1994

4.13107720

Sept. 30, 1994

4.20209761

Dec. 31, 1994

4.08741902

March 31, 1995

4.16480068

Distribution per share

Sept. 30, 1994

0.055

Dec. 31, 1994

0.056

March 31, 1995

0.056

June 30, 1995

0.056

Performance (as of March 31, 1995)

Annualized

1 quarter

1 year

3 years

5 years

University Endowment Fund

3.2%

4.3%

8.8%

9.6%

Standard & Poor's 500

9.7

15.6

10.6

11.4

Lehman Government/Corporate Bond Index

5.0

4.6

7.1

9.0

*Consumer Price Index (CPI)

0.8

2.8

2.7

3.2