Five Oxford colleges stand to gain £30 million per year between them after an investment fund in which they are major shareholders opened to private investors.
St Catherine's, Christ Church, Balliol, St John's and New College collectively own 60 per cent of Oxford Investment Partners (OXIP), which has launched a new feeder fund for private companies designed to grow the main fund. It is hoped that this growth will boost revenue, in turn passing greater profits on to the colleges. Estimates are that annual £30 million per year will be shared between the colleges.
Chief Operating Officer Paul Martin called the move "an excellent extension of the existing fund" from which "the colleges clearly stand to benefit." He called the new fund, which will link directly into the main fund, "a very positive move for the company".
OXIP was set up in March of this year, initially in conjunction with three Oxford colleges, as an investment fund with a more diverse strategy than other alternatives. It was designed to follow the lead of US institutions like Harvard and Yale with Harvard managing a return of nearly 20 per cent on the £15 billion it invested last year. The investment fund refused to give profit estimates, but it is understood that, by opening the fund out to private investors with a lower minimum investment of £100,000, the company hopes to grow towards its target of £1bn within a three-to-five year period.
David Palfreyman, the Bursar of New College, said that with "more money to be managed" it will be "a potentially more effective fund, and for the participating shareholders of the business hopefully it will be more profitable. It's a good way of managing money." He added that he hoped other charities and foundations would do the same. The treasurer of Christ Church, James Laurie, also praised the "innovative strategy of OXIP" saying that they "are pleased to see the feeder fund has been established because [they] believe that will enable more investors to benefit."
Click for the Oxford Times 16/6/06, the OXIP prospectus, the Independent 3/10/06.