Harvard Management Company, investment manager of the largest
U.S. university endowment plan, has been one of the more active
among university endowments.
The investment firm's use of ETFs dates back at least several
years and HMC is also known
for embracing an array of emerging markets
Going somewhat unnoticed in the fanfare of the most recent 13F
filing season is that HMC still holds investments in about 20
ETFs. That much is not surprising. Something else that drew
little attention was the degree to which HMC slashed its exposure
to emerging markets ETFs in the fourth quarter.
From Chile to China to India, HMC pared stakes in plenty of
popular country-specific emerging markets ETFs in the last three
months of 2012.
The iShares MSCI Chile Capped Investable Market Index Fund
) was just one of the emerging markets ETFs HMC has reduced
exposure to. HMC held nearly 439,250 shares of the lone Chile ETF
at the end of the fourth quarter, a 13 percent reduction from the
prior three-month period.
Staying in Latin America, HMC reduced its exposure to the
iShares MSCI Mexico Capped Investable Market Index Fund (NYSE:
) by 25 percent to about 384,470 shares. HMC also reduced its
stake in EWW's largest holding, mobile phone carrier America
), by three percent while leaving unchanged its position in EWW's
second-largest holding, Fomento Economico (NYSE:
The endowment plan manager also lowered its stake in the
iShares MSCI Brazil Capped Index Fund (NYSE:
eight percent last quarter
. HMC's positions in Petrobras (NYSE:
) and Vale (NYSE:
), EWZ's two largest holdings, were unchanged. HMC also
liquidated its entire stake in the iShares S&P Latin America
40 Index Fund (NYSE:
Perhaps in a sign that some professionals are starting to
there are better ways to grab ETF exposure to
, HMC slashed its investment in the iShares FTSE China 25 Index
) by 44 percent in the fourth quarter.
That may sound like a lot, but HMC also liquidated all of its
positions in the WisdomTree India Earnings ETF (NYSE:
) and the iShares MSCI Poland Capped Investable Market Index Fund
HMC's stakes in some of FXI's top-10 holdings, including China
) and Cnooc (NYSE:
), were unchanged.
Staying in Asia, HMC lowered its stake in the iShares MSCI
South Korea Index Fund (NYSE:
) by 18 percent, but left unchanged its investments in the
iShares MSCI Malaysia Index Fund (NYSE:
) and the iShares MSCI Philippines Investable Market Index Fund
). HMC also did not alter its position in the Market Vectors
Indonesia ETF (NYSE:
), the management firm's fifth-largest holding.
HMC also cut its investment in the iPath MSCI India Index ETN
) by 48 percent to just over 401,200 shares. The firm also sold
nearly 2,300 shares of the iShares MSCI Turkey Investable Market
Index Fund (NYSE:
) in the quarter.
However, while HMC was busy reducing exposure to emerging
markets ETFs, it did add to some of its U.S.-focused positions.
HMC's investments in the iShares Core S&P 500 ETF (NYSE:
) and the iShares Russell 2000 Index Fund (NYSE:
) grew by four and six percent, respectively, during the fourth
quarter. HMC added seven percent to its stake in the Vanguard
Dividend Appreciation ETF (NYSE:
), the largest dividend ETF by assets.
During the fourth quarter, HMC slashed its stake in the
iShares MSCI EAFE Index Fund (NYSE:
) by 80 percent, reducing its investment in that ETF by over
126,300 shares to just under 30,000 shares,
according to the most recent 13F
. The firm also added a new investment in the Vanguard MSCI EAFE
) of almost 232,400 shares.
HMC was also active with commodities funds during the fourth
quarter, reducing positions in the PowerShares DB Agriculture
) and the PowerShares DB Energy Fund (NYSE:
). The firm added to positions in the PowerShares DB Base Metals
) and the PowerShares DB Precious Metals Fund (NYSE:
For more on ETFs, click
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