What Do Harvard and KFG Clients Have In Common?

by | Jun 1, 2006 | Fee Only Financial Planning, Financial Therapy

Brains?  Of course. 

But what does their $26 billion endowment trust have in common with KFG client portfolios?

If your answer was “our asset allocation policy,” you are right.

An article in the May 12 edition of Fortune Magazine gave some details of the asset allocation of Harvard’s endowment trust. The trust is often referred to as one of the more successful, cutting-edge investment portfolios among public plans.

Here is their current allocation:

  • 28% Domestic Equities
  • 13% Commodities
  • 12% Market Neutral
  • 11% Domestic Bonds
  • 10% Foreign Equities
  • 10% Real Estate
  • 16% Other

Here is the allocation of the KFG 70-30 portfolio:

  • 27% Domestic Equities
  • 24% Foreign Equities
  • 10% Commodities
  • 10% Real Estate
  • 10% Market Neutral
  • 9% Domestic Bonds
  • 10% Other

Obviously, we have less “Other” and more foreign equities.  But what struck me was the similarity in allocations to three asset classes that are not normally found in most plans–commodities, real estate, and the market neutral classes.

So, is KFG in the same class as Harvard?  Well, we certainly are when it comes to asset allocation.

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