Th e Investment Returns of Nonprofi t Organizations, Part I TALES FROM 990 FORMS

Nonprofit charities and foundations hold endowments and many other kinds of invest-ments. How do these investments perform? Some high-profile nonprofit endowments, including those of colleges and universities, have been studied previously. This study is the first, to our knowledge, that looks at a large number of the diverse types of nonprofits. We investigate the determinants of investment performance using a large panel data set culled from the 990 forms that nonprofits must file annually with the IRS. In this first part of our article, we discuss our approach and the challenges of using these data to infer invest-ment returns. The IRS data, though less than perfect, yield valuable measures of the invest-ment returns of nonprofits. They reveal that some charities consistently do better in their investment returns than do others