Charitable Gift Giving Enters The Alternative Space

Vanessa Doctor

8 December 2010

Fidelity Charitable Gift Fund has expanded its Charitable Investment Advisor Program to include the ability to invest a portion of the fund's assets in alternative investments.

The CIAP allows advisors to develop and manage customized portfolios for Gift Fund donors with a giving account of at least $250,000. Advisors also have the ability to customize the portfolio with a mix of stocks, bonds, and mutual funds.

"Adding alternative investments to the CIAP allows advisors to diversify and potentially increase investment returns in the clients' charitable portfolios, ultimately enabling donors to grant more to the causes they care about," Sarah Libbey, the president of the Gift Fund, said in a statement.

In a survey by Fidelity Investments conducted in 2009, alternative investments were viewed by 82 per cent of financial advisors as important to their clients' investment goals. In a related study by Spectrem Group, it was also shown that 50 per cent of ultra high net worth households, or those with at least $25 million in investable assets, invest in hedge funds, while 56 per cent are involved in private equity.

Along with this new advisor capacity, Fidelity also recently launched the Private Donor Group, which supports advisors and HNW donors with at least $1 million on their giving accounts, providing education and assistance on philanthropic planning activities.

"December is traditionally the most active month in terms of charitable giving and we expect this year to be no different. We've seen donations of non-publicly traded assets triple through the third quarter and appreciated securities have comprised more than half of the Gift Fund's contributions," added Libbey.

The Fidelity Charitable Gift Fund is an independent public charity established in 1991. Since its launch, it has supported over 136,000 nonprofit organizations with upward of $10 billion in grants.