Investment advisors

Mark Eibel, left of Russell Investments, was the guest speaker at a recent program targeted to nonprofit organizations. He was hosted by Bill Stevens, a Raymond James financial advisor based in Green Valley. 

For those nonprofits that have invested their nest eggs in the stock market and want to see them grow, a top investment analyst recently provided an overview of some of the forces that may drive the U.S. and world economies in the year ahead.

Mark Eibel, director of client investment strategies for Seattle-based Russell Investments, was the guest speaker for a Feb. 6 program sponsored by W.F. Stevens Financial Advisors of Green Valley. The firm uses the strategies created by Russell to manage money for the Greater Green Valley Community Foundation and several affiliate nonprofits and foundations in the area.

Attending the program at the Community Performance and Art Center were board members and executive directors responsible for endowments supporting the arts, environment, civic beautification and recreational activities, a school and a library.

Those depending on donor support heard the U.S. economy looks like it's in good shape heading into 2020, Eibel said.

A 50-year low in unemployment and rising wages offer support to consumer spending, which makes up the lion’s share of the U.S. economy, and mitigates any possibility of a recession in 2020, Eibel said.

The positives still outweigh the negatives at this stage, but the risks shouldn’t be ignored, such as trade uncertainty that is curbing business investment and risks abroad such as Brexit and a slowdown in China brought about by the coronavirus, Eibel said.

Speaking on Thursday, Eibel said a fourth day of gains sent shares on Wall Street to fresh peaks after China sought to bolster its coronavirus-hit economy by cutting tariffs on a range of U.S. products.

When you see headlines about a drop in the S&P 500 or the Dow, a nonprofit whose endowment is tied to the stock market does well when it owns a diversified mix of equities as well as bonds, and therefore your portfolio’s performance will be different, Eibel said.

“Your goals are long-term, and your perspective should be, too. While markets will fluctuate day to day, a wider view of your portfolio can help you make decisions that are best suited to keep you on track,” he said.

Eibel said most nonprofits are drawn to fixed-income investments, such as bonds and money market funds, as well as equities that can “withstand the (market) corrections and grow money in the long term.”

With a fiduciary responsibility to their donors, boards and members, most nonprofits are looking for the middle ground, with a small element of risk, he added. He said those guiding investment decisions would benefit by purchasing umbrella liability policy “to handle the what ifs” should a portfolio’s value get slammed.

That shouldn’t happen with astute board oversight, he said. 

Nonprofits can grow endowments “so you are able to continue your good works,” said Eibel, who sets strategic allocation targets for the firm. But doing good means adhering to a disciplined process, he added. “Have a diversified portfolio and let time do its job for you.”

Eibel makes several hundred presentations each year around the U.S. to groups like the one that gathered at CPAC. He’s a frequent guest on television and radio networks such as CNBC, Bloomberg TV and Bloomberg Radio.

Steve Sinovic | 520-547-9728

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