Harvard loses at least $8 billion as investments sour
Harvard University, which helped lead investors' charge into private equity and hedge funds as stock and bond values soured over the past decade, has lost nearly a quarter of its endowment so far this year, the university's newspaper reports. That's meant a hiring freeze, among other cutbacks.
Harvard University, which helped lead other institutional investors into private equity and hedge funds, has lost nearly a quarter of its endowment as values plunged to $29 billion from $37 billion during June 30 - October 31, the university's newspaper reports. That's meant a hiring freeze at Harvard's Arts and Sciences faculty, among other economies. Harvard Crimson story here.
That coudl be a bad sign for Princeton, Yale -- and the Pennsylvania State Employees' Retirement System, which modeled itself on the more aggressive Ivy League investment portfolios by plowing billions into "alternative investments" in hopes they'd escape stock and bond market volatility. SERS trustees meet today in Harrisburg to review their losses and possible new investments. See recent PhillyDeals column on $8 billion in Pennsylvania pension losses here; see recent Wall Street Journal story on losses from SERS's "portable alpha" stock derivative investments here.
On the other hand, Harvard's setback may be reassuring for trustees of the University of Pennsylvania and other endowments that were slow to put their billions in what have turned out to be highly volatile investment classes. (To put things in perspective, Harvard's loss is bigger than Penn's endowment.) See past PhillyDeals item here.