The Fidelity Charitable Gift Fund has expanded its Charitable Investment Advisor Program to enable financial advisors to invest a portion of the Gift Fund’s charitable assets in alternative investments, including hedge funds, hedge funds of funds and private equity funds, the charity announced Tuesday.
The Charitable Investment Advisor Program (CIAP) allows independent investment advisors to develop and actively manage customized portfolios for Gift Fund donors with a Giving Account of $250,000 or more. In addition to alternative investments, advisors can customize a donor’s Giving Account portfolio by using a mix of stocks, bonds and mutual funds. According to the statement, assets managed in CIAP have increased 22% through the third quarter of 2010, compared with the same period last year.
“Adding alternative investments to the CIAP allows advisors to diversify and potentially increase investment returns in their clients’ charitable portfolios, ultimately enabling donors to grant more to the causes they care about,” Sarah Libbey, president of the Gift Fund, said in the statement.
The announcement said a 2009 Fidelity Investments survey found that 82% of financial advisors view alternative investments as important to their clients’ investment goals. Moreover, according to a recent Spectrem Group study, half of ultra high-net-worth households (those with $25 million or more in household assets) own hedge funds and 56% own private equity.
The Gift Fund has also introduced the Private Donor Group to support advisors and high-net-worth donors with at least $1 million in Giving Account balances. Through a dedicated relationship management and service offering, the new entity can do these things:
- Provide guidance on the types of assets donors may contribute—including special assets beyond traditional cash equivalents and publicly traded securities
- Offer education on the Gift Fund’s various investment options
- Ensure grants are made effectively and efficiently, with the donor’s charitable objectives as a priority (for example, facilitating direct international grants)
- Provide information on legislative changes that may affect philanthropy
- Serve as liaisons with external resources (such as philanthropic advisors)
The announcement said that as part of its Private Donor Group offering, the Gift Fund has created a network of professional philanthropic advisory firms. Initially made up of 10 philanthropic advisors,