The Shevchenko Foundation, through its Investment Committee, oversees the investment of its assets using the services of a professional money manager. Scotia Cassels Investment Counsel, the current manager, provides an expert investment team.

The goal is to invest in a broad array of assets that will provide a long-term return greater than that available from risk-free assets, while managing and minimizing the risk associated with these assets.

This section of our Website allows you to review the many facets of how managed funds work and can benefit your organization. Should you have any additional questions related to this matter, please contact our office and we would be pleased to assist you.

By working together… we can earn together!

Why Managed Funds?

How Will the Relationship Work?

Why are Managed Funds Cost Effective?

What are the advantages?

 

Why Managed Funds?

Managed Funds offer other Ukrainian foundations and organizations in Canada the opportunity to benefit from the professional money management expertise operating under the supervision of the UCFTS and its Investment Committee at rates that most simply would not be able to negotiate by themselves.

The responsibilities of the Foundation's Investment Committee include:

• Writing and maintaining a comprehensive Investment Policy;
• Setting and reviewing the asset mix;
• Monitoring the manager's activities and the performance of the investments;
• Comparing the fees charged by the manager in relation to other managers;
• Ensuring that administrative functions such as bookkeeping are complete; and,
• Reporting to the Board of Directors.

Investment Committee members have volunteered considerable time and applied their expertise to providing prudent and appropriate direction for the investment of our community's funds.

 

How Will the Relationship Work?

A Managed Fund is viewed as a "related subsidiary account" of the primary account of the Foundation. The Board of Directors and the Investment Committee oversee the investments of all the Funds.

The Investment Manager reports only to the Board of Directors and Investment Committee. A governing agreement/contract will be drawn up for each individual Managed Fund.

The Investment Policy that governs the Foundation will govern all Managed Funds. This Investment Policy will allow one customized item - asset mix. The asset mix decision can be made by the Managed Fund's Board of Directors, or can be delegated to the Foundation Board of Directors. All other items in the UCFTS Investment Policy will apply to all funds. A copy of this policy can be viewed at the Foundation's national office upon request.

Each account will be separate, receiving its own statement and performance numbers. In addition to the capital, both interest and dividends earned will be kept separate.

 

Why are Managed Funds Cost Effective?

The Foundation's size allows it to negotiate very reasonable investment management fees. Additionally, as a charitable organization, the Foundation receives a fee break from Scotia Cassels.

Thus, the Foundation is currently being charged 0.50% (1/2 of 1%) on the full amount, considerably less than the fee schedule typically charged by Scotia Cassels.

For smaller Ukrainian foundations and organizations, this fee break would not typically be available. For example, on $500,000 of assets, $6,250 (11/4%) would be charged per year. In addition, a minimum fee of $4,000 is charged regardless of asset size, thereby rendering the costs detrimental on small accounts below $500,000 in assets.

The fees charged by discretionary money managers are a low-cost investment alternative to mutual funds for high net-worth individuals and organizations. However, the minimum fee charged for these services makes them cost-prohibitive to small investors.

For servicing a Managed Fund service, the Foundation's seasoned Investment Committee will administer and oversee the investments of Ukrainian foundations and organizations. The Foundation will charge a nominal 0.25% (1/4 of 1%) per annum. As a "related subsidiary account" of the Foundation, Scotia Cassels will provide discretionary money management services for 0.50% (1/2 of 1%) fee.

Example of fee schedule:

Managed Fund portfolio	Scotia Cassels	UCFTS	Total
Any amount less than $4,000,000.00	½ of 1%	¼ of 1%	¾ of 1%
Greater than $4,000,000.00	½ of 1%	$10,000

 

What are the advantages?

Foundations and organizations can benefit from the experience of the Investment Committee of the Foundation, whose members have demonstrated a deep commitment to the Ukrainian community in Canada and a strong understanding of investment needs. They are thus able to ensure that funds are managed in a manner congruent with the purposes of these funds.

Enhanced long-term returns will contribute to meeting the goals and objectives of each foundation or organization and thus will benefit the Ukrainian community in Canada.

Small investors typically have only one option for professional money management services, and that is mutual funds. The average fee charged on a mutual fund (referred to as a Management Expense Ratio, or MER) if greater than 2%. Thus the 0.75% (3/4 of 1%) being offered for Managed Funds is a very cost-effective means of growing community funds.

Portfolios are constructed based on specific income needs, time horizon, tax status and risk tolerance.

Investment discretion is given to portfolio managers, so the decision-making is with the professionals.

Quarterly commentaries on the financial markets and on the specifics of your portfolio are provided, together with individual performance numbers for each account.