Harvard Could Invest Entire Endowment With Bill Ackman, John Paulson And Still Be Fine

Who needs hedge funds when you have hedge fund managers?
Author:
Publish date:

Harvard University is the world’s wealthiest university. It is not even close: With $37 billion in the bank, it’s got $10 billion more than its nearest rival, Yale. Unlike Yale, it accomplishes this feat without being very good with money: Yale, under legendary endowment chief David Swensen, managed an 11.3% return in its last fiscal year. Harvard, under new and significantly less-legendary money man Narv Narvekar, had to settle for 8.1%, in spite of firing everyone. This is something of a trend.

harvardhedge

And do you know what? It doesn’t matter. Thanks to the likes of John Paulson and Ken Griffin (but not Steve Schwarzman or Paul Tudor Jones), Harvard doesn’t need to make a fucking nickel on the market. It could print its diplomas on shredded thousand-dollar bills and heat the entire campus with bricks of Benjamins and no matter what sort of investing coup Swensen comes up with next, he’ll never catch up with the clowns at the Harvard Management Co.

This embarrassment of riches helped Harvard University raise more than $9 billion in its most recent fundraising campaign. That record haul represents a key achievement of Drew Faust, who steps down this month as Harvard’s 28th president after an 11-year tenure…. Such benefactors, in effect, bailed out Harvard from Faust’s other legacy: a decade of poor investment performance at the university’s $37.1 billion endowment, higher education’s largest. During that time, it returned an annualized 4.4 percent, compared with 5.9 percent for the average Ivy League school. By lagging the average, Harvard missed out on about $6 billion in investment gains over the last decade, according to an estimate by Wellesley College economist Phillip Levine.

Harvard Billionaires Bail Out Alma Mater From Poor Fund Returns [Bloomberg]
Legendary investor Paul Tudor Jones: Why I turned down Harvard [FN]

Related