Endowment Fund

An endowment fund is a pool of financial assets donated to an institution, such as a university, nonprofit, or charity, with the purpose of generating income to support the organization’s long-term mission. The principal amount of the endowment is usually kept intact, while a portion of the investment earnings is used for funding scholarships, research, or operational costs. Endowment funds are typically managed by professional investment teams and are invested in a diversified portfolio to ensure sustainable growth. Endowments provide a stable source of funding, allowing organizations to plan for the future and support their activities over time.

Example

Harvard University’s endowment fund, one of the largest in the world, provides significant financial support for its educational and research activities.