OUR SOLUTIONS
Nonprofit Investment Management
WHY PARTNER WITH AN INVESTMENT MANAGER?
The job of managing the investment portfolio generally falls either to an investment committee, which typically meets less than ten hours per year, or internal finance personnel, who are also charged with overseeing the operating finances of the organization. In each case, the structure does not typically allow for the focused attention necessary to manage a complex institutional portfolio prudently and efficiently.
​
When an organization chooses to partner with an Investment Manager, it is typically because the institution does not have sufficient resources or expertise to manage investments directly, especially given the ever-increasing complexity of global markets.
​
Our clients trust our innovative solutions to help them make better investment decisions. We craft investment programs to improve long-term financial outcomes and the impact they can have. The investment program is tailored to your long-term financial goals, constraints and time horizon. Many of our clients tell us that they could not bear the expense of building a team that is this comprehensive, with this level of experience, and this level of expertise in house.
We offer a full service, outsourced, discretionary service which includes:
- Discretionary investment management
- Governance
- Customized investment strategies
- Investment policy design
- Asset Allocation
- Risk Management
FULL SERVICE INVESTMENT MANAGEMENT SOLUTION
Regula Aurea offers a full service, discretionary, investment management solution to nonprofits, universities, and endowments. This type of solution is often called an Outsourced Chief Investment Officer (OCIO). We build long-term partnerships with our clients designed to achieve investment outperformance and operational excellence. A tactical approach to the markets is used to provide a derivative overlay to core investment holdings designed to create income and protect the investment principle. We focus on increasing income from investments so that our clients can have a larger impact on their missions.
Many firms claim to be an OCIO or an Investment Manager focused on nonprofits and endowments, but those labels are used broadly and the level of service and experience vary widely amongst firms in this space. An OCIO, such as Regula Aurea, typically focuses on OCIO services. They tend to have a smaller client base and use an independent and open architecture approach to manager selection. This means they have the ability to choose from many different products and solutions. They also aren’t normally limited in the types of strategies they offer or in their ability to be a discretionary manager. We believe the independent model best aligns the manager’s interests with the interests of its clients.
OCIOs vary as to the level of customization and sophistication they offer. Some have a fund with a single asset mix and underlying manager lineup. Others have asset class-specific funds and can therefore customize the asset mix but not the manager lineup. While others, such as Regula Aurea, can customize both the asset mix and the manager lineup.
OTHER TYPES OF INVESTMENT MANAGEMENT
Other outsourced investment solutions are offered by consultants, banks, multi-product managers-of-managers, and mutual fund complexes.
-
Consultants charge lower fees, but tend to have embedded conflicts, including those relating to the allocation of limited capacity managers. These conflicts and issues should be carefully vetted by an asset owner and/or its search consultant.
-
Banks have numerous business lines and typically offer a range of investment products. A bank’s access to sought-after investment managers and ability to outsource to them may be limited, because managers often compete with some of the bank’s business lines, and therefore may not accept outsourcing allocations from them.
-
Other outsourcing firms include multi-product/managers-of-managers, and even some mutual fund complexes. Evaluating these models involves some of the same considerations as the consultants and banks.
DISCRETIONARY INVESTMENT MANAGEMENT
Financial markets today are increasingly complex and often highly volatile, making it difficult to differentiate between short-term fluctuations and longer-term trends. Even experienced boards can lack the time and emotional distance necessary to manage their own investment portfolios. Discretionary management is a service that is suited to boards who want to focus on the mission of the organization and want experts to handle the management and administration of their portfolios day to day. With this service we handle the investment decision making for you.
CUSTOMIZED INVESTMENT STRATEGIES
We are big enough to provide access to a diverse set of investment strategies including private placements (for qualified clients). Yet, we are small enough to custom tailor the investment structure for risk tolerance, cash flow needs, and investment standards.
GOVERNANCE
Regula Aurea facilitates client participation in programs designed to ensure our collective goal of achieving and maintaining fiduciary excellence. These activities also enable the board and staff to validate effective oversight of the investment program to their constituents.
INVESTMENT POLICY
A well-conceived investment policy statement is an investment program’s blueprint, defining its mission, implementation and governance. It is a roadmap for your portfolio that will serve you especially well in volatile markets. We collaborate with you to not only formulate an investment policy that supports your organizational and investment objectives, but also proactively and periodically review and revise it to reflect any changes related to you, your portfolio, or capital markets.
Regula Aurea collaborates with the board, investment committee, and staff of each client to develop customized investment policy guidelines. Reflecting each client’s specific objectives – such as return requirements, risk tolerance, payout rates, regulatory considerations, liquidity constraints, and mission-related investing. The investment policy statement is the foundation for the portfolio that Regula Aurea will build and manage.
MANAGER SEARCH
We provide innovative and enduring investment solutions across asset classes in private and public markets.
Manager selection is very important to achieving our clients’ investment goals. Regula Aurea employs a comprehensive manager research and due diligence process to find managers. Our team uses its expertise to identify talented investment managers across asset classes and geographies, including less efficient niche markets.
PERFORMANCE MEASUREMENT
Our performance and attribution reports help uncover the strengths and weaknesses in your portfolio by isolating individual manager skill from market movements, asset allocation and rebalancing decisions. We use advanced analytics, standard and custom benchmarks to enhance the relative performance of your investments.
ASSET ALLOCATION
Regula Aurea leads the board and staff of each client through the process of translating the investment objectives into a long-term strategic asset allocation framework. Our process is valuation-based and incorporates historical data, forward-looking analytics, and our collective experience. Together we integrate the strategic asset class targets, allowable ranges, and appropriate benchmarks into the investment policy.
Portfolios can encompass a wide range of investments, from equities and bonds to alternative investments such as structured products and funds.
RISK MANAGEMENT
Regula Aurea's robust portfolio construction and risk management activities enable us to tailor a risk profile according to the policy guidelines and investment objectives of each client. We incorporate a range of quantitative and qualitative inputs to manage risk, adjust allocations, and implement rebalancing. Our analytical processes are oriented toward prudent long-term decision-making rather than short-term market timing.
​
When constructing a portfolio, we want to fully understand your objectives and priorities in order to generate the best returns given the level of risk you are able to accept. With an in-depth understanding of your goals and concerns, we are then able to move forward and design an investment strategy that you can be happy with now and in the future.
To find out how we work with clients and our investment philosophy read our Frequently Asked Questions.
​
To find out how we might be able to work together contact us for a meeting.