Harvard University loses another top investor
Fixed income manager is latest to leave endowment
Harvard University, whose mammoth endowment has been slammed by the market downturn, is losing another one of its top investors.
Marc Seidner, who oversees investments in US fixed income securities at Harvard Management Co., plans to resign at the end of the month, according to a person familiar with the matter. Seidner couldn’t be reached for comment. A Harvard spokesman declined to comment.
In addition, Michael Llodra, another member of the fixed income team, plans to leave the investment group in the next few weeks, the person said.
The defections are just the latest to hit the Cambridge university. In late May, Harvard said Edward Forst, executive vice president, would step down Aug. 1 to return to New York and resume his career in the financial services industry. Forst, a former executive at investment banker Goldman Sachs, is also on the board of Harvard Management.
Harvard had impressive investment returns for years - until last year. The endowment, which stood at $36.9 billion a year ago, is expected to fall 30 percent to around $26 billion by June 30, the end of its current fiscal year.
As Harvard funds as much as one-third of its annual operating budget with investment returns, the decline has led to a round of cutbacks on campus, from unfilled faculty positions to lower numbers of graduate teaching fellows, to fewer orders for scientific equipment. Harvard has also postponed grand plans to expand its campus in Allston.
Seidner, a former executive from Standish Mellon Asset Management, joined Harvard three years ago as part of the university’s efforts to revamp the bond division. He earned $6.3 million, making him the second-highest paid fund manager, after Stephen Blyth, who manages the international fixed income investments, and who is expected to fill in for Seidner.
Llodra, who previously worked for JP Morgan Chase, joined Harvard a little more than a year ago.
In past years, some of Harvard’s biggest investment stars have left to form hedge funds or investment companies of their own. Former chief Jack Meyer left three years ago to launch a $6 billion hedge fund called Convexity Capital Management. But it wasn’t clear what Seidner and Llodra plan to do next.
Matthew Tuttle, a wealth manager and author of a book on Harvard’s and Yale’s investment strategies, said that while he doesn’t know why Seidner is leaving, “fixed income is always the poor stepchild at endowments.’’ Until the recent stock market crash, stocks and other investments have traditionally scored more impressive annual returns than bonds. And when endowments do invest in bonds, they often use simple strategies, said Tuttle, president of Tuttle Wealth Management LLC in Stamford, Conn.
Harvard hasn’t released detailed investment results for the current fiscal year. In the previous fiscal year, the US bond business earned a 16.1 percent return, compared with 12.7 percent for its benchmark index.
Pension & Investments magazine first reported Seidner’s departure on Friday. The Wall Street Journal reported Llodra’s resignation yesterday.
Todd Wallack can be reached at twallack@globe.com. 
