Oil and natural gas company stocks perform well in college endowments

Oil and natural gas company stocks outperformed all other asset classes held by college and university endowments, according to a new study conducted by Dr Robert Shapiro, Chairman of economic consulting firm Sonecon, for API.

“America’s colleges and universities have seen strong returns from their investments in America’s oil and natural gas renaissance,” said API Vice President for Regulatory and Economic Policy Kyle Isakower. “University and college investments in oil and gas firms outperformed every other asset class examined in their endowments.”

Average annual returns on oil and natural gas company stocks over the last decade were 72% greater than on all US equities and 89% greater than on all endowment assets over the same period, according to the study. Oil and natural gas company stocks held by college and university endowments produced average annual returns of 13.4%, compared to 8.1% for real estate, 7.8% for all US stocks, 4.9% for bonds, and 1.6% for 3 month treasury bills.

“Institutions of higher education depend on income from oil and natural gas investments, which also helps students who cannot afford full tuition,” Isakower said. “The energy revolution taking place in America supports 9.8 million jobs and represents 8% of the US economy. Affordable, abundant domestic natural gas resources have also made America a leader in reducing emissions and have helped drive carbon dioxide emissions down to 27 year lows.”

Isakower noted that the Sonecon study is the most recent in a series that have found that millions of Americans own and derive the benefits of oil and natural gas company stock, and that those stocks were also the highest performers for large public pension funds.


Adapted from press release by Rosalie Starling

Published on 04/09/2015


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