Investment Portfolio Management
We have enjoyed decades long partnerships with our non-profit organizations. Each organization has unique needs, opportunities, and challenges. We co-create portfolios with you by taking into account the unique challenges that face each board. Our investment portfolios are built for the long term, with consideration for needs of the short term. Our investment process includes:
- Strategic & Tactical Asset Allocation Framework
- Proprietary Investment Manager Research
- Creation of Investment Policy Statement
- Spending Policy Consultation
- Ongoing Board Education
- Ongoing Manager Monitoring
Whether it be stocks, bonds, cash, liquid alternatives, or private investments such as equity, debt, and real estate, choosing the right mix of assets is critically important. In fact, numerous studies on the topic have concluded that a substantial percentage of returns can be explained by the asset allocation decision, rather than the selection of individual securities within the asset class.*
We focus on capital preservation and downside risk management in all of our allocation policies. We believe in a global approach to allocation to mitigate risks of home country bias. We balance the science and art of asset allocation by taking into account a wide variety of inputs:
- Construction of efficient frontier through mean variance optimization
- Long-term and short-term expected returns for asset classes
- Asset correlations
- Organization’s liquidity needs, risk tolerance, and behavioral factors
*Studies include Brinson (1986), Ibbotson & Kaplan (2000), Hensel, Ezra, and Ilkiw (1991)
Proprietary Investment Manager Research
Our Consultants and Research team undertake a rigorous due diligence process when selecting investment managers. We employ an independent approach that limits conflicts of interest because we do not offer proprietary investment products. Our job is to find our clients the best investment strategies within each asset class and implement the strategies in the most efficient ways. Our decision to not provide our own investment management products puts us on the same side of the table as our clients as we have no vested interest in any particular strategy. Our research process includes:
- Quantitative screens filter the universe of managers
- In-person meetings provide a qualitative assessment of the managers
- Ongoing monitoring and new funds searches, include listening to quarterly calls, hosting managers in Investment Committee meetings, and traveling to see managers
- Our proprietary focus list provides a framework for reviewing managers and taking action
Investment Policy Statement
Creation of the Investment Policy Statement (IPS) is a crucial step towards preparing your organization for long-term success. The IPS allows for seamless transitions of board members and investment managers. The IPS should outline the following:
- Specifically state the goals and objectives of the organization
- The role of all parties (board members, sub-committee members, consultant, managers) and the fiduciary responsibilities of each of the members, if applicable
- Define a benchmark and time horizon for measurement of success
- Strategic Asset Allocation targets & Tactical Asset Allocation ranges
- Outline investment categories or types that are excluded from inclusion in the portfolio
- Create rules for investment decisions
- State the manager evaluation process
Has your organization struggled to find the right spending policy? We can help.
While in some scenarios a spending policy is rather cut and dry due to legal or other guidelines, in other cases setting the right spending policy can be a challenge.
As a fiduciary, you are tasked with making decisions that are in the best interest of your endowment, foundation, or organization. Competing interests, board dynamics, and improper assumptions can anchor an organization to the wrong spending policy.
With decades of experience working with institutions, we have a unique vantage point that allows us to consult with your board to help balance ongoing liquidity needs with the need for an endowment to live in perpetuity.
Financial and investment education is at the core of our services. We understand that your board members and other people who run your organization are extremely busy managing careers, families, and volunteer work. We enjoy providing ongoing education tailored to your team and especially your new members.
Education can vastly improve your board’s decision making process and can mitigate the risk of grid lock and slow decision making. Our goal is to help drive efficient and thoughtful decision making so that your organization can focus on serving its mission. We work with you to implement a sound investment process.
- Asset Allocation education
- Investment selection education
- Fiduciary education
- Spending policy education
- Board structure education
Everyone at Carolinas Investment Consulting is committed to service that exceeds expectations. We are built to serve you and your specific needs.
Our third party performance reporting software provides a comprehensive view into the financial health and ongoing success of your organization.
- Total return reporting on any and all time periods
- Cash flow monitoring over time
- Historical and current asset allocation
- Individual funds and investment strategy performance
- Account-by-Account and overall organizational reporting
We happily provide our boards with ongoing reporting and commentary as part of our service model. Simply put, we offer fully custom performance reporting to ensure that our presentations are built to serve you.