Jewish Federation client increases mission-aligned offerings.

Background: Supporting the mission.

In dedication to their mission, one Jewish Federation client (the client) includes a requirement to invest in Israel investments in their investment policy statement. The IPS stipulates that a 5% allocation to Israel investments is required in the main portfolio. Prior to 2020, this was accomplished through purchasing Israeli bonds. The client wanted to consider a more comprehensive approach of direct investments. They also wanted to offer a direct Israel investment option for their donor advised fund (DAF) offerings.

Solution: Directly support Israel.

Our investment manager research team conducted evaluations and reviewed a range of options including active managers and ETF investments. The team presented multiple strategies of direct Israel investments including active management, ETFs with Israel only holdings, and a combination of ETFs with Israel only and S&P 500 exposure. The client consensus was to focus on direct Israel only ETF investments and not incorporate S&P 500 exposure. We recommended that the main portfolio investment include a combination of Israel Bonds and a blend of Israel only ETFs. In addition, a DAF standalone option was added which mirrored the Israel only ETF solution implemented in the main portfolio. 

This DAF option allows for donors to directly support Israel and simple implementation through a diversified ETF investment to help mitigate risk and dampen industry concentration. The end result includes DAF options of active managers and ETFs with Israel only holdings. The client is now offering the direct ETF Israel investment as a DAF, and it is also implemented in their main portfolio.

The information in this case study is for information purposes only, does not constitute investment advice or an offer to buy or sell securities, and should not be deemed to be a recommendation to make any investment. This case study, insofar as it discusses investment strategies, portfolio construction, and/or other investment-related themes, is general in nature and does not address any individual circumstances or risk tolerances which may vary significantly. The reader is reminded that an investment in any security is subject to a number of risks including the risk of a total loss of capital, and that discussion herein does not contain a list or description of relevant risk factors. Diversification may not protect against market risk. There is no assurance the goals of the strategies discussed will be met. Information concerning SEI’s recommendations over the last year is available on request. The information expressed herein represents the current, good faith views of SEI at the time of original publication, and has not been updated.