Harvard's Endowment Needs the Classics

The Harvard endowment -- a $37.6 billion treasure chest that is Harvard University's largest financial asset and is the world's biggest academic endowment -- is in need of a steady hand. The latest jolt came when Stephen Blyth recently stepped down as chief executive of the Harvard Management Company, which manages the mammoth endowment. HMC is now on to its sixth CEO since 2005.

If you looked at the Harvard endowment’s long-term investment returns, you might wonder what all the turmoil is about. According to HMC, the endowment returned a hefty 12.2 percent annually from July 1973 to June 2015. That handily beat a traditional 60/40 portfolio of U.S. stocks and bonds, which returned 9.7 percent annually over the same period. (Results for the Harvard endowment's most recent fiscal year that ended in June 2016 are not yet available.)