Harvard Lost Billion Dollar Bet on Tomatoes and Sugar

A recent Bloomberg article offers an overview of the performance of Harvard University’s endowment fund, highlighting the failed efforts by the school’s highly paid money managers to “manage risks other schools avoided.” The article reports that Jane Mendillo, who headed the endowment six years ago, led Harvard at that time into one of its “most daring foreign adventures” by investing at least $150 million in agricultural development in the impoverished northeastern region of Brazil—specifically, in… Read More

Harvard Endowment Chief Slashed Value of Some Investments

The decision by the Harvard University endowment fund last year to write-down its nearly $4 billion in natural resource investments by more than 25% has made it the worst performer among the Ivy League, according to a recent article in The Wall Street Journal. According to the article, the $37 billion endowment’s new chief “Narv” Narvekar would have slashed the valuations further if not for pushback from other board members. As it is, the write-downs… Read More

Harvard Endowment Shows Disappointing Performance

While an improvement over the 2% loss suffered in 2016, Harvard University’s endowment returned a lackluster 8.1% this year, according to a recent article in The Wall Street Journal, “marking another disappointing year for the world’s richest school.” The article cites comments of the endowment’s new chief, N.P. Narvekar explaning that the weak returns are a “symptom of deep structural problems” and that these issues are likely to continue hurting returns. According to data provided… Read More

Dartmouth Endowment Returns Hit New High

For the fiscal year ended in June, Dartmouth University’s endowment fund returned a record 14.6% to $4.96 billion, after a nearly 2% decline last year. This according to a recent article in Chief Investment Officer. According to the university’s CIO Alice Ruth, “Dartmouth’s outstanding returns are a direct result of partnerships with world-class managers, which bring breadth and depth to the portfolio in service of Dartmouth’s mission.” Gains were attributed to a “broad rise in… Read More

Yale’s Trouble with Timber

Yale University’s endowment fund has a chunk of timber holdings, an effort to hedge against inflation, but the holdings are raising controversy as some believe it puts large expanses of forest at risk. This according to a recent article in Bloomberg. According to the article, the university owns thousands of acres in New Hampshire, adding that one forest industry veteran complains, “They’re cutting everything, even the growing stock.” The move by many of the nation’s… Read More

Yale’s Actively Managed Fund Performance Waning

The majority of the Yale University endowment fund is invested with active managers but, if you compare its returns to low-cost active strategies rather than to passive indices, “Yale’s active managers don’t look so special,” writes Bloomberg’s Nir Kaissar. In its recently released 2016 annual report, the article says the esteemed university’s endowment rebutted “fee bashers” by arguing, “The important metric is net returns, not gross fees.” Kaissar points out, however, that Yale’s attempt to… Read More

Hulbert Challenges Harvard’s Lesson on Investing

After a disappointing year in which its endowment fund actually lost money, Harvard University fired half of its investment staff, writes Mark Hulbert in last week’s MarketWatch. However, he argues, “it’s not that past performance doesn’t count; what’s irrelevant is performance over the recent past. Calendar-year performance, for example, tells you next to nothing about whether your manager is a good bet for future returns. The long-term performance of Harvard’s endowment fund is strong, says… Read More

Harvard Endowment Goes Back to Basics

Last year, Harvard University allocated 14 percent of its $35.7 billion endowment fund to hedge fund strategies, but managed these internally rather than through outside managers. This according to a recent Bloomberg article by Nir Kaissar. The article explains that this departure from the traditional endowment model (used by peers such as Yale and Columbia universities) represented an effort by Harvard to retain the typical management fees (2 percent) for its own coffers. Unfortunately, however,… Read More

Swensen’s Yale Endowment Model Not a One Size Fits all Investing Approach

The evolution of Yale University’s endowment fund has become something of legend, as described in a recent article in Chief Investment Officer. In the mid-80’s, as the story goes, the Ivy League university’s CIO David Swensen shifted the $25.4 billion fund from a traditional mix of primarily bonds and a few equities into “carefully selected alternative investments—hedge funds, private equity, and venture capital—using external managers to capture the so-called illiquidity premium.” It was a good… Read More

David Swensen: The Gatekeeper of Yale’s Endowment Fund

At $25.4 billion, Yale University’s endowment fund is one of the largest in the country. Since 1985 (when it totaled $1 billion), it has been overseen by David Swensen, described in a recent New York Times article as “legendary” in this role. Throughout his tenure, the article states, Yale has built one of the “strongest records among the nation’s largest endowments.” According to the Times, Swensen has “pioneered an investment strategy that expanded Yale’s portfolio… Read More