Alitis’ diversified, lower risk approach to investing is the perfect match for foundations, endowments, not-for-profits, First Nations, pension funds, and family offices.
Managing long-term capital implies longer term time frames, but all Foundations face the challenges of volatile investment markets and low investment returns that aren’t meeting the funding requirements of a Foundation. This can lead to serious issues for the Board and Investment Committees.
Whether it be the erosion of donor confidence, a delay or cancellation of a large planned donation or bequest, or just the frustration of some donors over unacceptable investment returns, Foundations can easily reduce or avoid these challenges with a more conservative approach to investment management.
Indeed, most of Canada’s larger foundations are pursuing the addition of new asset classes to their long term funds in order to enhance returns and reduce portfolio risk. As a leader in multi-asset class investment, Alitis is available to add value to the investment management of your capital with either our comprehensive mandates or our custom-tailored carve-outs.
With historically low interest rates, Foundations now face a serious challenge to find sufficient return to meet disbursement requirements and operating expenses. Alitis has substantial experience and success in alternative fixed income investments such as High Yield Bonds, Mortgage Funds and Asset-Backed Commercial Loans etc., and offers highly diversified fixed income portfolios targeting net of fee returns in the 5-7% range.
The founding partners of Alitis Investment Counsel, Cecil Baldry-White and Terry Gwilliam, both have a solid understanding of the investment challenges Foundations face in managing their long term assets.
Both Cecil and Terry sat on the Board of a community foundation for several years. They worked closely with the Board and Investment Committee to update their Investment Policy Statements in order to follow the lead of larger foundations that are expanding into several new asset classes, beyond the traditional stocks and bonds used by most Portfolio Managers.
As Boards fully understand the reality of this low interest rate economy and the potential volatility with stock markets they are actively seeking advanced methods to reduce risk and drive more consistent returns that can meet their disbursement requirements and cover operating expenses.
Most endowment funds require a gross return of at least 7–8% to cover the 3.5% disbursement ratio, operating costs and the impact of inflation on their long term mandates.
Alitis is well-positioned to deliver solid returns with substantially less risk. The key to reliable long-term returns is to not lose large amounts when stock markets experience serious declines. Avoiding significant declines is what Alitis is all about. Our highly diversified portfolios include meaningful investments in private real estate, mortgages, asset-backed loans, absolute return strategies and other investments, to provide a higher level of diversification, less concentrated risk, and a more probable positive return profile than highly concentrated portfolios of just stocks and bonds.
Whether your organization needs assistance with an updated Investment Policy Statement, a more diversified investment approach, or exposure to high-yielding mortgage funds, Alitis is a perfect partner for endowment funds of all types of foundations.
Not for Profits
Whether your group is a Faith-based or Values-based organization, a Hospital, Educational Facility, Health Provider or Community Services organization you likely have similar short, medium and long term investment goals. Low risk investments are often the foundation of invested capital due to either the near term needs for the funds and/or the desires of the donor base of funding agencies; nobody wants to see a large decline in the capital due to stock market volatility or other events.
The reality is that many organizations hold too much of their capital in the bank earning low returns in daily savings accounts or shorter term guaranteed deposits – in many cases not even keeping up with inflation. While this certainly meets the objective of safety it doesn’t necessarily meet the objectives of the organization in terms of the services you provide. Lost investment returns due to low-yielding deposits translate into less money for programs and service delivery. Conversely, high risk investment strategies that result in short term, or permanent, losses result in the same net effect – less money for programs.
At Alitis we have constructed some of the most diversified and stable portfolios available. Whether you are looking to earn slightly higher returns on short term capital, midterm capital earmarked for expenditure or long term capital that simply needs to deliver solid investment returns we have a solution to fit your organization’s needs.
Alitis is happy to educate and present to Boards, Investment Committees or senior management, in a confidential and focused environment. We have helped organizations update their Investment Policy Statements to accommodate institutional style investments, set realistic return expectations and establish simple risk measurement systems to ensure that your decisions meet the requirements of all stakeholders.
Alitis fully understand the high standard of care required with the management of both operating and long term trust funds. Our lower risk, multi-asset class approach to wealth management provides a documented track record of solid returns with lower risk.
Band members, Managers and independent review boards can all have the confidence that their decision to place capital with Alitis conforms to a high level of fiduciary responsibility and has a high probability of meeting jointly agreed upon financial objectives.
Having lived for over 22 years on Haida Gwaii and worked with band members for private wealth management, Cecil has a solid understanding of the culture, goals and challenges facing First Nations people.
With our conservative approach, unique investment portfolios and outstanding reporting, Alitis Investment Counsel is a perfect fit for First Nations groups seeking the highest level of wealth management available.
If your pension fund is under $250 million there is likely an opportunity to improve your risk-adjusted returns with the institutional-style approach offered by Alitis. Unfunded liabilities from poor investment performance have been the nemesis of many pension funds after the 2008 financial crisis. Post 2008 we are seeing gravitation towards higher than historical allocations to stocks, in search of yield, and growth. The collapse in bond yields has created a fundamental challenge to asset allocations that have been traditionally limited to just stocks and bonds. Over-weighting stocks certainly captures the market’s upside, but when the market reaches its tipping point the concentration risk of holding too much in stocks can really damage a pension funds solvency ratio.
Our risk-adjusted returns are solid, because our portfolios are designed to capture the upside from multiple asset classes (not just stocks and bonds), while offering outstanding downside protection. The end result is a higher level of confidence in achieving realistic target rates of return, and consistency of returns by avoiding significant negative years.
For organizations looking to enhance the fixed income component of your asset mix the Alitis offers a carve-out strategy, the Alitis Mortgage Plus mandate. This unique portfolio is an industry leader in the way we combine private and public mortgage pools to achieve geographic, asset type and manager diversification. With a target return of 6% to 8%, net of fees the Alitis Mortgage Plus mandate can significantly enhance returns, and potentially reduce portfolio risk.
Alitis is happy to prepare and present a customized presentation to your Investment Committee, management, actuary or consultant.
Our experience is that most Family Offices have advanced investment management platforms using defined processes, risk management assessment, compliance reviews and third part consultants. These groups are well-advanced compared to retail investment platforms.
Alitis is ideally positioned, however, to add value with our exceptional approach to the investment management process, particularly the risk management component. On a fee for service basis we are happy to conduct audits and/or help Family Offices tighten up their systems to ensure your families wealth is being managed to the highest standards.
The other area where Alitis can potentially add investment value is with our Alitis Mortgage Plus mandate. With significant experience in the mortgage and alternative fixed income asset classes we have created an excellent adjunct to an otherwise well-diversified portfolio. Call us today if you feel your families’ portfolio could benefit from a well-diversified, relatively liquid (monthly) portfolio of MICs, asset-backed loans and other income-oriented securities, designed to deliver 6% to 8%, net of fees.