Stanford received a 14.3% return on its investment portfolio this year, the University announced on Oct. 7.
The announcement stated that Stanford’s Merged Pool, the University’s primary investment vehicle, was valued at $47.7 billion as of June 30. Stanford’s endowment alone was worth $40.8 billion on Aug. 31, according to the report.
The University’s return on investment in the last fiscal year exceeded the 10.9% median return for U.S. universities in 2024, according to a preliminary report by Cambridge Associates.
CEO of Stanford Management Company (SMC) Robert Wallace revealed that the University’s high performance resulted from the use of a slightly different asset allocation, despite sharing a common investment structure with other institutions.
Around 70% of Stanford’s endowment portfolio is invested in some type of equity. The other 30% is in a combination of absolute return and fixed income, according to Wallace.
This endowment structure is typical across universities. Investments in equity are used to achieve target returns, while those in fixed income provide stability to the overall portfolio.
“We executed very, very well last year in all of our private equity asset exposure and then our absolute return exposure, and we did well in our public equity exposure as well,” Wallace said.
The endowment report comes amidst an increase in federal taxes on college investment income from 1.4% to 8% starting July 4, 2025. The tax applies to the Merge Pool as well as other investment funds across the University, including the affiliated hospitals.
Despite the tax increases, SMC intends to maintain its current investment strategy, according to Wallace.
“Our strategy really won’t change,” said Wallace. “Dialing up the risk in the portfolio probably is not a sensible thing to do as an investor.”
For students, the endowment’s performance correlates with financial support. Currently, around two-thirds of Stanford’s financial aid comes from the endowment and about 88% of students graduate without debt, according to details the University released online.
“The [recent] return is very good compared to many years and before,” Vipara Rasphone M.B.A. ’26 said. “I’m someone who is on a scholarship from Stanford, [and] I am really grateful for that.”
Stanford plans to maintain support for students despite increased investment taxes, according to University spokesperson Luisa Rapport.
“Stanford will continue to prioritize its core mission of teaching and research,” Rapport wrote in an email to The Daily. “We have committed to preserving robust financial aid for our students.”
The language in this article was updated to better reflect the words of Robert Wallace.