Let's look at the facts.
Conservative Investment Policies
The investment approach for private school endowments has historically been a conservative, cautious approach. Trustees and their advisors have generally been good stewards of their finances. They avoided risky investments such as derivatives and real estate despite calls from some quarters to maximize returns. The reason for the decline in their portfolio value is simple: just about every investment-grade instrument declined.
Back in the 90s, sustainability became an important principle in private school mission statements and philosophies. The National Association of Independent Schools has taken a leadership role in supporting all kinds of sustainability initiatives including financial sustainability with its 1,500 member schools.
From the Nais: "In order for independent schools to thrive in the 21st century, NAIS believes that they must be sustainable along five dimensions: financial, demographic, programmatic, environmental, and global."
As a result, schools with significant endowments (greater than $10 million) generally were well-positioned to weather the economic storm which 2009 brought on with a vengeance.
Financial Aid is a Priority