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Non-Profit Investment Advisory

What You Should Know

Non-profit organizations have a fiduciary responsibility to prudently manage community assets under their control, which includes, but is not limited to, donations and investment funds. When individuals or committees of individuals are empowered by the organization with the responsibility to oversee the disposition of assets, they are mandated to perform their duties as a prudent person would. Among the duties that are required, is the Duty of Care, which is specific to seeking professional help to perform the activities that a specific party is either unable or unqualified to adequately perform.

Investment management is often delegated. However, for the organization’s designated decision-making person(s), fiduciary responsibility, and therefore liability, is always maintained. Since the intent of a gift or other financial award to an organization is specific to the sole interests of that organization and the intent of the donor, developing and implementing prudent decision-making policies and procedures that provide clear guidance regarding how to make investment-related decisions and how to perform ongoing supervision, is essential to not only making good decisions which are likely to improve results but also to limiting liability.

Investment Advisory 

Choosing S.E.E.D. as Your Organization’s
Fiduciary Advisor for Investment Program Oversight

 

  • We act as a third-party advisor to help your organization oversee its’ investment program.

 

  • We provide ongoing assessments on portfolio management and IPS compliance.

 

  • We make recommendations regarding investment selection, allocations, and other portfolio management-related topics.

 

  • Your organization can continue to manage investments in-house or via an established relationship with your current Investment Manager.

 

  • We help your organization limit liability by being a better fiduciary.

What it costs

We provide customized services to your organization’s unique needs, so our pricing for this service is customized as well. Contact us today for a customized proposal including a scope of work and pricing.

 

Contact Us

As your organization’s investment fiduciary, we provide customized discretionary investment management.

Traditional Management

The goal of the Traditional Management Strategy is to provide a low-cost, professionally managed portfolio that minimizes speculation and market timing while providing an efficient mix of income and capital appreciation. The investments found in this portfolio are ETFs and mutual funds.
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Socially Responsable Investing

S.E.E.D.’s socially responsible investment portfolio allows individuals to match their values to their investment portfolio. Our selection process involves screening investments based on Environmental, Social, and Governance (ESG) factors.
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Customized Investment Management

Customized Investment Management is an alternative to the Traditional Management Strategy. The goal of a Customized Management Strategy can vary greatly, but a general commonality is a focus on higher income and capital appreciation. Each client in this investment program has a Customized Strategy based on their unique needs and perspectives.
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Traditional Management

  • S.E.E.D. views “risk tolerance” both as a condition of investing environment and by personal definition. Because of this perspective, it is our opinion that traditional questionnaires are inadequate. We believe that personal discussion and discovery with clients regarding their goals, biases, history, and competencies is the primary way to assess portfolio design.
  • S.E.E.D. rebalances accounts twice yearly unless a lack of volatility creates a scenario where asset values have not “spread” from their targets. S.E.E.D. will periodically decide to remove, restrict, or add an asset class to manage risk per the client’s objective.
  • S.E.E.D. uses fi360 for peer-to-peer ratings to filter potential investment options. fi360 is a leader in fiduciary management training and services. They provide a service that rates funds based on a significant amount of criteria including (but not limited to): underlying charges, management history, performance, style drift, audits, etc.
  • S.E.E.D. uses a combination of strategies to develop its portfolio models including modern portfolio theory, efficient frontier, and a general effort to avoid speculation. To design and test these strategies, S.E.E.D. uses tools provided by fi360, Morningstar, eMoney, Charles Schwab, and our own research.
  • S.E.E.D. generally has all dividends pay to cash in a portfolio. We then buy funds back into the underlying portfolio each time we rebalance. S.E.E.D. typically holds about 2% cash in portfolios. This is accounted for with a 2% reduction in the fixed-income portion of the portfolio’s allocation.

Investment Quality Review

S.E.E.D. has a fiduciary obligation to our clients. In order to maintain this standard, we utilize fi360 to do a quality, efficiency, and performance review of every mutual fund and ETF investment that we recommend to purchase, buy, or hold.

fi360 is an independent, third-party fund review software. It provides analysis of metrics that include expense ratios/fees, performance relative to peers, and fiduciary scores, among other criteria.

Fund reviews and rankings do not guarantee future returns, but independent studies have indicated a correlation between funds scoring in the top quartile for one-year fiduciary scores and the top-performing funds in subsequent years.

Socially Responsible Investing

S.E.E.D.’s socially responsible investment portfolio allows individuals to match their values to their investment portfolio. Our selection process involves screening investments based on Environmental, Social, and Governance (ESG) factors. This includes how the company’s operations impact the environment, the effect the company has on their employees and their surrounding community, and how the company is managed. The ESG screening process channels investments toward companies who are making strides to have a positive impact while also discouraging investment in companies whose operations are harmful at any or all levels of ESG factors.
  • Other negative screens can restrict investment in companies based on the products they sell. This is common in companies with gambling-, drug-, alcohol-, or tobacco-related products.
  • Research shows a positive correlation between ESG investing and the investment’s risk-adjusted return. This is attributed to that fact that companies striving to demonstrate ESG factors have the potential to be more sustainable in the long run.
  • The ESG screening for S.E.E.D.’s socially conscious portfolio is done in addition to the fiduciary screening applied to all of our fund recommendations.

Customized Investment Management

Customized Investment Management is an alternative to the Traditional Management Strategy. The goal of a Customized Management Strategy can vary greatly, but a general commonality is a focus on higher income and capital appreciation. Each client in this investment program has a Customized Strategy based on their unique needs and perspectives.
  • The portfolio itself is designed in two specific parts: fixed income and individual stocks. The fixed income portion of the portfolio is generally comprised of mutual funds and ETFs (although if deemed necessary it can be individual bonds), while the equity portion of the portfolio is generally comprised of 15 to 20 different individual equities diversified across many individual industries such as: Leisure, Oil and Gas Refining, Restaurants, Utilities, Insurance, REITs, Packaged Foods, Tobacco, Asset Management, Beverages, Drug Manufacturers, Industrial Metals and Minerals, Telecom Services, Consumer Electronics, Internet Content and Information, Aerospace and Defense, etc.
  • In the Customized Management Strategy, very few clients have the exact same holdings due to timing, investment goals, and tax situations.
  • S.E.E.D. rebalances the accounts twice yearly unless a lack of volatility creates a scenario where asset values have not “spread” from their targets. S.E.E.D. will periodically decide to remove, restrict or add an equity position to manage risk per the client’s objective.

A Fundamental Approach to Investing

At S.E.E.D. Planning Group we approach equity investing by focusing on the characteristics we believe make a company attractive. Through research we identify companies that have:

  • A sustainable competitive advantage
  • Growing free cash flows
  • A dividend that grows with those free cash flows
  • A strong balance sheet

Through our fundamental approach to investing, we help clients achieve their long-term goals by identifying companies we believe will grow their wealth over time.

Why Dividend Growth Matters

Dividend-paying and dividend-growing companies have had a higher annualized return and lower volatility historically than their non-dividend paying counterparts. Rising dividends tends to be an indicator of the other characteristics we believe make a superior business such as a sustainable and competitive advantage, growing free cash flows, and a strong balance sheet. Also, because an asset’s value should be a multiple of the income it produces, higher income generally leads to higher valuations.

Building Customized Portfolios to Meet Your Income Needs

As investors get closer to retirement, the important question shifts from “how much money do I need?” to “will my portfolio generate enough income for my needs?” We build diversified portfolio to meet your income needs through our Customized Portfolio program. Based on your tolerance and need for risk, S.E.E.D. combines fixed income with dividend-growing stocks to build a portfolio whose income increases with your rising income needs over time.
Nothing herewith in is investment advice and is intended for informational purposes only.

What does it cost?

 

S.E.E.D. provides ongoing investment management services. Investment services are offered at a charge of 1% (of the account value) per annum paid in quarterly installments on a per diem basis with a minimum fee of $10 per quarter.  Non-profits may receive special discounts.  

  • Accounts under $100,000 are charged $150 per meeting (limited to 1 hour) for investment reviews. Accounts under $100,000 are not eligible for investment management alterations required to meet IPS or Investment Committee guidelines. 
  • Accounts over $100,000 (for a rolling period of 6-months or more) are charged at 50% of the regular investment management fee and receive 1 meeting at no charge (limited to 1 hour) per annum for investment reviews. Additional meetings are charged $150 per meeting (limited to 1 hour) for investment reviews. This fee is charged to the account unless prior arrangements are established.  

 

  • Accounts over $100,000 that are subject to IPS and Investment Committee oversight and require alterations of S.E.E.D.’s investment management programs do not receive any discounts as outlined above
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We can also help with:

Fiduciary Consulting Services
Tax Planning