How bad are the stock market and the global economy in general?
So bad that the Harvard University endowment lost $2.3 billion this year. That’s It’s the first time this war chest has taken a dip in six years.
Before you run to CVS and buy a sympathy card for the manager of this fund, it still has a total value of $50.9 billion.
So, what went wrong? The people in charge say the blame goes to the stock market and the commitment the university has to its climate goals. If their goal was to lose a couple of billion dollars, well, mission accomplished.
Here are the details of this megafund. It is made up of over 1,400 separate funds, which are all lumped together and invested as a single entity. Harvard Management Company runs the show and makes the decisions on investments, which did not perform well thanks to the S&P loss of 11%, and Nasdaq was down 23% during the time the $2.3 billion evaporated.
Harvard Management Fund did take a moment to pat itself on its back for staying true to its climate goals, despite the massive losses.
“A number of institutional investors leaned into the conventional energy sector, through either equities or commodity futures, adding materially to their total return. HMC did not participate in these returns given the University’s commitment to tackling the impacts of climate change.”
The fund grew by $10 billion-plus a year ago, so that takes the sting off a bit.
According to Harvard, the entire campus benefits from the biggest university endowment.
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