Non-profit organizations are looking to expand their investments into global markets and see diversification as the best solution for dealing with current market volatility, according to an SEI poll of their finance executives, directors and investment committee members.
The quick poll of 86 executives of U.S.-based firms overseeing asset pools of $25 million to $1 billion also showed that most non-profit organizations have a high U.S.-based allocation.
Almost three out of four respondents allocated more assets to non-U.S. investments over the past year, and 92% said diversification is the key to protecting against volatility. Of the non-profit investment committees that increased their allocation in non-U.S. investments, 62% increased emerging markets equity; 47%, developed markets equity; 23%, global private equity; 25% global hedge funds; 27%, global fixed income; and 20%, global real estate.
Non-profits are at the forefront of embracing global strategies as a means for an increased level of diversification and more control of the investment volatility; however, there continues to be an unfamiliarity, Carolyn McLaurin, senior vice president of SEIs Nonprofit Management Research Panel, said in a news release. The fact of the matter is that they dont always have the resources to fully understand the global market and were seeing a high number of prospects and clients looking for global expertise and research capabilities when it comes to these products.