How tiny Houghton college beat Harvard

THE hotly competitive returns of college endowment performance are out, and the results have again shaken the higher education elite down to their Ivy League roots: The smallest endowments - those with total assets under US$25 million - outperformed their billion-dollar-plus rivals for the second year. The National Association of College and University Business Officers, known as Nacubo, and the Commonfund Institute last week released the latest results, which are, for most schools, far more important than whether they advance to the NCAA Final Four.

The 2016 fiscal year, which ended June 30, wasn't an especially good year for anybody. But the smallest endowments outperformed the billion-plus group, losing one per cent, on average, compared with a 1.9 per cent decline for the biggest endowments. Results were even worse for endowments of US$500 million to US$1 billion, which lost on average 2.2 per cent.

Falling behind by nearly a full percentage point has a huge effect on giant endowments such as Harvard's, which stood at US$35.7 billion at the end of the fiscal year. Harvard said its investments declined 2 per cent, and its endowment total dropped by US$2 billion because of the investment losses and spending. Harvard is now shaking up its endowment management.