Endowments question merits of hedge funds after negative returns in 2012

Arrow going down
Endowments slide to a loss as hedge funds underperform

The fiscal year that ended June 30, 2012 was a tough one for US university endowments. Hedge funds were partly to blame.

Investment returns were essentially flat over the one-year period at 0.3% as gains in fixed income and US equities were offset by losses in hedge funds, international equities and commodities, according to the latest data from Commonfund Institute and the National Association of College and University Business Officers (Nacubo).

The performance of hedge funds, which lost 1.2%