Although charities on either side of the pond may have similar missions or causes, U.S. and U.K. nonprofits distinctly differ when it comes to investment strategies.
The Financial Times reports that U.K. charities are taking a more aggressive approach to investment while U.S. nonprofits, battered by economic pitfalls of recent years, are opting for a conventional, conservative route.
Alasdair Gill, a consultant at Mercer, told the Financial Times that a shift to riskier investments has been perceived among U.K. charities:
“Charities, especially larger ones, are looking to broaden their spread of assets to include alternatives such as emerging market debt, hedge funds and private equity."
The Charity Commission, which serves as a regulator and registry for charities in the U.K., is also revamping their strategies. The commission is currently updating its investment guidance, encouraging charities to try new techniques to the old practice of garnering money for a cause.
On the other hand, U.S. charities are moving back to bonds, as their previous investments in hedge funds and private equity aren't returning as much as hoped.
Read more at The Financial Times.