Ortec Finance: Harvard's endowment fund could plummet up to 40% by 2040
Ortec Finance has carried out some new analysis, which reveals that new policies proposed by the US administration and regulatory changes are set to have a devasting impact on endowment funds.
Its analysis and scenario mapping reveals that the size of Harvard University’s endowment fund – currently the largest endowment in the United States – could plummet as much as 40% by 2040, and by even more when you take into account inflation.
The fall in assets under management coupled with its financial commitments will create huge liquidity pressures on Harvard’s endowment fund as Ortec Finance’s analysis reveals the top 10 US endowments hold 72% of their investments in illiquid assets, with roughly 36% of total investments sitting in private equity. Comparatively, only 20% of their total investments sit in public equity.
With the announcement of Trump’s ‘one big beautiful bill act’ the longstanding model of US endowments, which have been a staple of the investment landscape for decades, is facing unprecedented challenges. Ortec Finance has carried out in-depth financial modeling creating both a ‘full policy scenario’ (a worst-case scenario) and ‘limited policy scenario’ to reveal the long-term impact over the next 15 years of these policy and regulatory changes on Harvard University’s endowment - but Ortec Finance warns that all US endowment funds must urgently face up to the very difficult challenges that now lie ahead.
Headquartered in Rotterdam, The Netherlands, Ortec Finance has offices in Amsterdam, London, Toronto, Zurich, Melbourne, and New York. Ortec Finance helps 600+ clients manage their $15 trillion assets under management.
