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A total return investment policy must always be paired with a spending rate, a formula that governs what percentage of the market value of the endowment can prudently be spent on operations in a single year. Established by an institution's board of trustees, the spending rate should strike a balance between short-term spending needs and long-term capital growth. In order to increase the predictability and reduce the volatility of the investment income stream, spending is usually determined by multiplying the spending rate by a multiyear moving average of the value of the endowment or by using some other smoothing mechanism.

The failure of the Society to protect its endowment can be attributed to a mix of factors. The following analysis reviews the Society's performance in each of the three areas of endowment management.

Return on investments

The Society was a leader among institutions of its kind in adopting a professional approach to the management of its investments. In 1964, during the presidency of Frederick B. Adams Jr., the Society hired Fiduciary Trust International, Inc., to manage its investments. Fiduciary Trust remains the Society's investment man­ager today. Overall, the performance of the Society's investments has been in line with market indexes. Since 1980, the Society's total fund has earned a compound annual return of 12.4 percent. This figure compares with a compound annual return of 13.5 percent for the Standard&Poor's 500 and a 15.1 percent return on the Dow Jones Industrial Average.

Table 10.1 shows the Society's annual investment performance from 1981 through 1993 as compared to total annual return benchmarks published by Cam­bridge Associates.

Kennedy and Schneider (1994, pp. 19, 23, 25). The column headed “Cambridge Mix” is a weighted average with an assumption that the benchmark investment portfolio is comprised of 75 percent equities and 25 percent bonds.
The table reveals that the performance of the Society's port­folio was quite respectable. It is clear that the erosion of the Society's endowment during the 1980s was not due to poor management of the investments.

Capital gifts

The second element of a comprehensive endowment management policy is capital fundraising. New gifts provide a boost to an institution's financial base when investment returns are good and help it maintain that base when they are not.

For institutions dependent on endowment, the 1970s were extremely diffi­cult. The loss of endowment principal in the early part of the decade, coupled with high inflation, fundamentally altered the budgetary equation. Investment returns were falling just as costs were rising, and deficits became the rule. The historical narrative presented earlier documents not only the Society's mounting deficits but also its poor record of private fundraising. Capital fundraising was no exception.

Given the struggle to balance the operating budget, it should come as no sur­prise diat the Society did not raise capital gifts during this period. Except for 1977, when capital gifts totaled $259,000, the Society raised a total of just $85,000 in sixteen years, an average of just $5,300 a year.

See Tables C.4-2 and C.5-2 in Appendix C.

Questions & Answers

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research.net
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there is no specific books for beginners but there is book called principle of nanotechnology
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are you nano engineer ?
s.
fullerene is a bucky ball aka Carbon 60 molecule. It was name by the architect Fuller. He design the geodesic dome. it resembles a soccer ball.
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That is a great question Damian. best way to answer that question is to Google it. there are hundreds of applications for buck minister fullerenes, from medical to aerospace. you can also find plenty of research papers that will give you great detail on the potential applications of fullerenes.
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Mostly, they use nano carbon for electronics and for materials to be strengthened.
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s. Reply
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Graphene has a hexagonal structure
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Source:  OpenStax, The new-york historical society: lessons from one nonprofit's long struggle for survival. OpenStax CNX. Mar 28, 2008 Download for free at http://cnx.org/content/col10518/1.1
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