Ivy League Endowments Not Making the Grade

• By the tickerspy.com Staff
• On 9:37 am EDT, Monday September 14, 2009

For most major investment firms and hedge funds, the extent of 2008's carnage has long been known, but for university endowments, the true scope of the damage is only just being made public.

According to the New York Times, the Harvard endowment dropped by -27.3% in its fiscal year ended June 30, while the Yale endowment fell by -30%. The drops mean billions in lost funds for the universities.

The endowments were likely hurt by exposure to an array of illiquid, alternative investments, a strategy that had won praise before the downturn. In addition to these investments, the endowments also include exposure to U.S.-listed, equities.

In the case of Harvard's top U.S.-listed holdings at the end of Q2 they turn out to be quite diversified, with an international bias that makes ample use of a variety of ETFs.

International ETFs held by the endowment include the iShares FTSE/Xinhua China 25 Index (NYSE: FXI - News), iShares MSCI Brazil Index (NYSE: EWZ - News), iPath MSCI India Index ETN (NYSE: INP - News), iShares MSCI Mexico Investable Market Index (NYSE: EWW - News), and iShares MSCI South Africa Index (NYSE: EZA - News). The endowment's largest U.S.-listed, equity holding by a wide margin was ETF iShares MSCI Emerging Markets Index (NYSE: EEM - News), where it was adding to its stake during Q2.

Meanwhile, Yale's top U.S.-listed holdings at the end of Q2 include large holdings in REITs Acadia Realty Trust (NYSE: AKR - News) and Douglas Emmett (NYSE: DEI - News). The endowment also has more modest holdings in stocks like biotech Celgene (Nasdaq: CELG - News) and optical communications networks firm Infinera (Nasdaq: INFN - News).

Pro portfolio performance is based on institutions' top-15 holdings as disclosed in quarter-end filings with the SEC. Pro performance does not take into account additional holdings beyond the top 15 nor does it include positions that are not required to be disclosed by the SEC. As such, Pro portfolio performance should be considered an approximation and not a precise record of how an institution has performed over time.

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