Changing the World One Investment at a Time: Lynne Amerson Authors ColoradoBiz Article

Socially responsible investing, or the practice of investing in companies that align with the investor’s ideals, has become more widely recognized and easier to implement than ever. In the article “Changing the World One Investment at a Time,” published in ColoradoBiz, Senior Portfolio Manager Lynne Amerson discusses the considerations potential social impact investors should be aware of, including three primary ways to invest, the need for diversification and the difficulty in remaining objective when it comes to selecting investments.

 

A traditional approach to socially responsible investing is the elimination approach, which limits an investor’s exposure to certain industries they may find morally dubious. A second approach is to become a shareholder and then take actions toward positive change, such as initiating proxy votes to pressure executives and board members. “It is with these concepts as a base that impact investing emerged as a third primary way to invest,” Lynne writes. “This has truly become a movement, as we’ve seen a growth of 40 percent or more in ownership of impact investing since 2014 among women, younger and ultra-high-net-worth individuals.”

 

Though the variety of investment channels allows for varying levels of capital commitments, diversification is less widely available than in many other investment types. Additionally, it can be challenging to remain objective when reconciling the desire to make a difference with the need to keep financial returns in mind. However, with the right amount of guidance and caution, impact investing can have profound value on both portfolios and the world for years to come.

 

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Focus on Asset Valuations, Not the Election: Harold Pine Authors Forbes Article

Though the news stream is full of discussions as to how the United States presidential election could impact the stock market, many strategists argue that investors are better off focusing elsewhere. In an article published in Forbes, Managing Director Harold Pine explains that it’s far more important for investors to focus on asset valuations.

Currently, valuation is, at just above 26, the third-highest in history – the only higher valuations were recorded in 1929 and 2000. Mr. Pine advises investors to examine their allocation to risk assets, and to see if that makes sense based on valuations and asset volatility.

 Mr. Pine concludes the article by advising investors to be patient and focus on the quantitative aspects of the stock market, rather than political rhetoric. “Trying to time when valuations will normalize is a difficult endeavor,” Mr. Pine writes. “I’d rather be early and patient than late and poorer.”

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Alicia Giltinan Authors Article on Family Wealth in Family Business Magazine

In the Family Business magazine article “Why Do Wealthy Families Fail?” Alicia Giltinan, the Chief Financial Officer of Chasefield Capital, explores the various definitions of failure and offers guidance on how to mitigate adverse outcomes among families with substantial resources.   

“Wealth can create a false sense of security that one doesn’t really need to create a budget, let alone adhere to it. The family business uses forecasting and budgets, but the family members may not,” said Giltinan.

A significant amount of family wealth comes in the form of multiple assets, but often, no one oversees the investments as a whole. “Each adviser may by doing his or her best to help the family make investment decisions the adviser believes are suitable. But absent one overriding investment policy statement for the family and a comprehensive portfolio summary from which to work, isolated investment decisions can create unnecessary risk,” explained Giltinan. One solution is to plan a family meeting so that everyone is on the same page about family resources. Giltinan also recommends that wealthy families develop an investment policy statement, which should include: investment objectives, time frame, risk tolerance, performance expectations, adviser responsibilities, asset class guidelines, and monitoring.

Family Business Magazine July 2016