- The $37 billion fund said to opt for external managers
- Move is reversal of expansion of group trading public stocks
Harvard Management Co., which oversees the university’s $37 billion endowment, eliminated eight positions this week in its public equities trading unit, according to a person with knowledge of the matter.
Harvard has opted to hire external money managers to oversee the funds they were handling, said the person, who asked not to be identified because the information is private. The move marks a reversal for the management company, which in the past couple of years has hired equities experts to expand internal trading operations after doing the same in fixed-income, commodities and other markets.
“We continuously evaluate how we can best allocate capital and leverage HMC’s comparative advantages to maximize performance over the long term,” Emily Guadagnoli, a spokeswoman for the Boston-based endowment, said in a statement. She declined to comment further.
Harvard is unique among university endowments, with a staff of more than 200 people. About 40 percent of assets are traded internally, with the rest farmed out to external managers. Yale by contrast hires outside fund managers to oversee almost all of its $25.6 billion of assets and has a staff of 49.
Stephen Blyth, the Harvard fund’s chief executive officer, has been reorganizing the fund and revamping the investment decision-making process since taking over as chief executive officer in January of 2015. The senior management team has been overhauled while a number of traders and executives have departed.
Harvard had about 15 percent of its assets allocated to domestic, foreign and emerging market equities last year, with money traded internally as well as externally through outside fund companies, according to an annual report.