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Wealth Gap Between Richest Colleges and Others Is Expected to Grow

The nation’s 40 wealthiest universities are getting richer, and their endowments are growing at a faster rate than those of other institutions, The Wall Street Journal says, citing a report to be published on Thursday by Moody’s Investors Service.

The 10 richest institutions held nearly one-third of total cash and investments at four-year colleges in the 2014 fiscal year, while the top 40 institutions accounted for two-thirds of the wealth, the report says. Moody’s officials add that the gap between the richest and the rest is only expected to widen.

Large endowments draw the top investment advisers and provide access to potentially higher-yielding investments, Pranav Sharma, a Moody’s analyst and the report’s lead author, told the Journal. As a result, he said, it is unlikely that colleges not already in the top bracket can catch up, “unless financial leaders make some big mistakes.”

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