SUMMIT, N.J., Oct. 30, 2025 (GLOBE NEWSWIRE) -- University endowment performance was universally strong in FY2025, but funds that outperformed the average benefitted from two emerging investment areas: artificial intelligence and digital assets, according to new research from Markov Processes International, Inc. (“MPI”), the leading independent FinTech provider of technology and services for investment analysis.
On average, large university and Ivy League endowments reported returns around 11%-12% in the fiscal year ending June 30, 2025, representing a strong year despite expected lags from fixed income, hedge fund, and real estate investment performance. Public equities and a rebound in returns in venture capital helped endowments overall.
However, three universities had particularly strong overperformance: University of Michigan (15.5%), Massachusetts Institute of Technology (14.8%), and Stanford University (14.3%). The reason? According to data from the MPI Transparency Lab, powered by MPI’s Stylus Pro software, AI investments and growing stakes in digital assets are, for the first time, showing up as drivers in overall performance.
“For endowments, opacity is structural, so we must subject all these systemically important funds to a top-down, returns-based analysis, using just the overall annual performance data they provide,” said Michael Markov, Founder and CEO of MPI. “What we have found is that, while these investments have contributed to performance for several years, we can, for the first time, attribute these investments to outperformance.”
MPI determined its findings by running endowments through its standard asset class factors, like equities, real estate, bonds, and private equity, and then added the additional thematic factors of AI and digital assets. The analysis indicated that digital asset exposure appeared meaningfully at Michigan, MIT and Stanford, as well as at Brown University, Cornell University, and Harvard University. AI exposure appeared at MIT, Stanford, and Michigan, as well as Princeton University, the University of Pennsylvania, and Yale University.
Indeed, Harvard likely would have shown similar outperformance if not for its exposure to lower-return fixed income.
Some of the AI-related gains sit inside late-stage venture marks — which can reflect internal valuations rather than realized exits. Large venture funds have, in some cases, marked up AI-focused portfolios significantly without corresponding distributions. “That’s normal for private markets,” said Markov. “It just means that not every contribution to a strong year is cash in hand on day one.”
MPI’s analysis has key implications for board trustees and endowment boards, Markov said.
“Our findings show that it is plausible that AI and digital-asset exposure is now large enough to affect overall results, and that will impact areas like liquidity stress and pacing and creates new challenges for board governance,” Markov said. “Boards and university trustees must assess what impact these investments have in the providing the funding that supports their educational mission.”
MPI launched its Transparency Lab in 2022 to provide a hub of proprietary attribution data for pensions and endowments, based on the company’s Dynamic Style Analysis (DSA) and MPI Stylus Pro software, which provided a quantitatively peek behind the curtain of pension and endowment investments, giving views that are often impossible to obtain otherwise. For three years, this data, based on returns characteristics rather than position-level disclosure, has allowed investors, alumni, beneficiaries, regulators, and other stakeholders to garner unique insight on endowment and pension holdings and performance.
“We have long said that pensions and endowments need to change the way they report to become less opaque,” Markov said. “As these emerging investment areas have an impact on the future of these institutions, it is imperative to release more granular, quarterly data in the spirit of transparency and good governance for all stakeholders.”
You can find a complete copy of the analysis here.
For additional information on MPI’s research or to get a demo of its Stylus Pro software, please contact MPI at +1 (908) 608-1558 or info@markovprocesses.com.
About MPI
Markov Processes International Inc. (MPI) is a global leader in software and services for investment analytics, monitoring, and reporting that illuminate the forces driving fund and portfolio behavior. MPI products allow investment professionals to enhance their data integration, due diligence, asset allocation, risk analysis, and content distribution, empowering them to be more efficient and scalable while differentiating themselves in a crowded marketplace. Follow us on Twitter @MarkovMPI and connect with us on LinkedIn.
For Markov Processes Peter Page VOCATUS ppage@vocatusllc.com
