Investing with a Tailored Portfolio

An important factor in choosing a tailored portfolio is whether you have sufficient funds (which usually requires large investment sums).

A tailored fund means that a fund manager will invest your money according to your specific requirements (such as avoiding companies which manufacture armaments).

Before you begin, it will be a good idea to familiarise yourself with the different asset classes that investment managers may offer.

Investment Advisor

Working with an investment adviser can be especially useful if you have a large amount of money to invest. They can help you to develop and implement a Responsible Investment policy. They can help you to identify and select a fund manager. Find out more about how to find an appropriate adviser.

Types of fund managers

Investing in Direct Holdings

Many fund managers will tailor your portfolio to invest directly in holdings which align with your investment policy. The benefit of this is that the investment manager is able to provide your charity with a bespoke approach tailored to your needs.

Example: Epworth

Investing in Fund of Funds

A number managers invest themselves only in other funds. These managers do not put investors’ money directly into the stock market, instead they invest it in other managers’ funds. Such portfolio can arguably be more diverse and thus be less risky from a financial point of view. However, to ensure the ‘fund of funds’ is following your ethical criteria you may need to check the underlying policy of each of the funds ‘contained’ in that fund.

Example: EQ Investors

A “Mixed” Approach

Many fund managers invest in both direct holdings and other funds. It is a good idea to look into the breakdown of the portfolio they propose to see how much of your money will be in direct holdings vs funds. It is also important to ask them how they will ensure your investment criteria will be applied to the indirect holdings (i.e. those in the funds they invest in).

Example: Castlefield

Choosing two or more fund managers

You many decide that you would like to place your money with two (or more) different fund managers. This could be because you feel this will further diversify your portfolio, making your investments less at-risk. Alternatively you might choose multiple fund managers because they offer different approaches from an ethical perspective.

If you do choose to employ multiple fund managers, do note that you will need to manager multiple investor relationships which will take up more time for your charity.

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