Summary of Harvard Management Company (2010)

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Summary of Harvard Management Company (2010)

By: Satrio Abi and Yanuar Budi Baskoro

* Harvard Management Company Introduction:
Harvard Management Company is a company which built by Harvard University itself. That means HMC is a wholly owned subsidiary of Harvard University. The company built for managing the financial matter and development of the university. Because the company is wholly owned by Harvard University, the Directors of HMC is directly choosen by President and Fellow of Harvard College. The function of HMC is for managing University’s financing especially endowment. Endowment become the important income for HMC. The main job of HMC is to earn money for the endowment. The management do some investment to get the endowment funds. They have the unique ways to do the investment which is using the Hybrid Theory. This case is focusing on the endowment. * Endowment:
Why endowment become so important? Because the endowment fund is used for developing the university. The fund is for establishing new research program, creating more scholarship for student and buy some new art and collection. The fund also for increasing financial aid, reducing tuition fee for students and improve facilities for learning such as hiring new profesional academic intiatives or creating new laboratorium for research. The total value of endowment for 1990 until 2009 is increased continuosly. The total value in 1990 is $4.7 billion, in 1995 is $7 billion, in 2000 is $18.3 billion, in 2005 is $25.2 billion and in 2009 is $25.4 billion. The endowment spending for university is increased continuosly too. The endowment spending for university in 1990 is $180 million, in 1995 is $283 million, in 2000 is $556 million, in 2005 is $855 million and for 2009 is $1.5 bilion. * Investment for Endowment
From 1980s until 2009, the HMC investment for endowment is changed. In the…...

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