Among the most prominent reasons for gold’s impressive run in recent years is the metal’s increasingly enthusiastic embrace by institutions historically disinclined to buying – or buying much of – it.

Take central banks. After long avoiding making meaningful allocations to gold, central banks have remained net purchasers of gold since 2010, when the world was still mired in the depths of the financial crisis. But since 2022, when Russia saw roughly half of its sovereign assets frozen by the West as punishment for Moscow’s invasion of Ukraine, central bank demand for counterparty-risk-free gold demand has remained at or near record levels.

Other historically gold-averse institutional investors, such as asset managers and hedge funds, have been making strategic turns to gold, as well, amid mounting concerns over the degree to which intensifying economic, fiscal and geopolitical uncertainty could diminish the returns of portfolios predominately populated by conventional assets.   

“Uncertainty is at the core of [why] hedge funds are turning to gold,” notes Joseph Cavatoni, senior market strategist at the World Gold Council.

And it seems the enthusiasm of larger investors to utilize alternative assets like gold for the purpose of diversifying their overall holdings is spreading further still…including to one particularly storied portfolio that has never previously owned precious metals: the endowment fund of Harvard University.

Harvard Management Company Embraced High-Profile Alternative Assets With Both Arms Last Quarter

According to its most recent 13F filings with the Securities & Exchange Commission, Harvard Management Company (HMC) – the wholly owned subsidiary of Harvard University charged with managing the endowment – bought 333,000 shares of SPDR Gold Shares (NYSE: GLD), which is the world’s largest and most notable gold-backed exchange-traded fund (ETF). The purchase marked the portfolio’s first-ever allocation to gold…an allocation valued at around $105 million, currently.

Clearly, HMC strategists were of a mind to dip more than a big toe in the alternative-asset waters last quarter. In addition to the sizable gold purchase, the endowment – which had slightly more than $53 billion under management at the conclusion of fiscal year 2024 – bought 1.906 million shares of BlackRock’s iShares Bitcoin Trust (IBIT). Right now, that position is worth roughly $121 million.

Also worth noting are the strategic revisions HMC made to its technology holdings in Q2. The fund reduced its allocations to Alphabet by 10% and Meta by 67%, while dumping its positions in Uber, Rubrik and the Invesco QQQ ETF altogether. At the same time, HMC made significant additions to its positions in select high-profile tech companies, including a 30% increase in its allocation to Nvidia as well as a near-50% increase in Microsoft.

Indeed, HMC’s Microsoft position is now the fund’s largest; 623,000 shares, valued around $317.5 million as of this writing.

Rutgers Professor: “Expanding Money Supply” Likely Driving Investors Such as Harvard Endowment to Seek Out Perceived Stores of Value

As for the substantial positions in gold and bitcoin suddenly taken by the fund, HMC has not publicly addressed its reasons for the allocations…but observers suggest that at least some of the same motivations prompting large institutions to invest in these outside-the-box assets are being felt, as well, by the captains of the endowment.

“Since the money supply has expanded dramatically around the world, especially since the pandemic, some investors are looking at gold and cryptocurrencies as a store of value,” wrote Rutgers Business School Professor John M. Longo in a statement about HMC’s alternative-asset allocations.

As for gold, specifically, it’s hard to imagine the metal’s exceptional record of resilience in recent years has gone unnoticed by HMC fund managers. Since the beginning of 2022, gold has climbed nearly 90%, outperforming conventional assets by a substantial margin. And since January of last year, gold has achieved new all-time highs nearly 70 times.

Ultimately, however, it’s the reasons underpinning these performance numbers which surely lie at the heart of HMC’s decision to buy gold. Rutgers’ Professor Longo referenced intensified currency debasement and its inflationary implications as one. But there are a host of others, including ever-worsening geopolitical tension around the world.

Analysts expect multidimensional global uncertainty – comprised of numerous economic, fiscal and geopolitical factors – to grow further still. Should that happen, it’s reasonable to believe gold…seen by many as the quintessential safe-haven asset…will continue to strengthen.

And that potential (likely?) outcome is something which likely hasn’t escaped the notice of endowment fund managers, either.

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