The Vatican revealed its real estate portfolio for the first time—and it includes over 5,000 properties around the world.
APSA directly administers 4,051 properties in Italy and entrusts to outside companies the administration of some 1,200 properties in London, Paris, Geneva and Lausanne, Switzerland, the report said.
The APSA budget synthesis highlighted the challenges posed by the COVID-19 pandemic. During the 2020 fiscal year, APSA reported a profit of almost 22 million euros ($25.8 million), a significant drop from the profit of 73.21 million euros ($86.3 million) in 2019.
Bishop Galantino, who was tapped by the pope in 2018 to head the office, told Vatican News that despite heavy losses due to lockdowns throughout the year, “prompt and concrete attention” was given to people and, especially, commercial businesses, who occupy buildings owned or managed by APSA.
a) the management of bank accounts;
b) Titles and securities
c) Shareholdings in companies and investment funds;
d) Real estate
LDS Church discloses the $37.8 billion stock portfolio of its biggest investment fund
For the first time, the LDS Church’s biggest investment fund has disclosed its Wall Street holdings, revealing $37.8 billion in stocks and mutual funds.
The federal filing may be the best answer ever to how The Church of Jesus Christ of Latter-day Saints has invested the excess tithing paid by its 16 million members. The detailed list included 1,659 stocks and mutual funds, including household names like Amazon, Chevron and Walmart, that the fund held for the quarter ending Dec. 31.
The investment fund, called Ensign Peak Advisors, quietly submitted the filing Feb. 14 to the U.S. Securities and Exchange Commission. The stock portfolio appears to represent a large portion of the total value of Ensign Peak, which whistleblowing brothers Lars and David Nielsen said in a complaint sent to the IRS controls assets worth at least $100 billion.
The SEC filing is standard for “institutional investment managers” with assets of at least $100 million.
Ensign Peak Advisors has met that threshold for years, yet the SEC website shows this is the first time the fund has submitted such a filing.
The LDS Church, through a spokesman, declined to answer questions about the recent filing or why it wasn’t submitted before.
“They may have previously read the rules to exempt advisers to religious institutions, and are now disclosing in light of the recent controversy,” said Jeff Schwartz, a University of Utah professor who focuses on corporate and securities law and reviewed the filing for The Salt Lake Tribune.
https://www.sltrib.com/religion/2020/03/07/lds-church-discloses/
This filing doesn’t encompass all of the church’s financial holdings. Some assets are held in shell companies that file separately.
In 2018, The Truth and Transparency Foundation, the nonprofit newsroom behind the former MormonLeaks site with a stated mission to disclose information about religions, said it had found 13 such shell companies with assets of $32 billion.
Apple to Zions
Ensign Peak Advisors itself is far larger and more diversified than any of those smaller funds, the Feb. 14 filing shows. About $3 billion of the Ensign Peak Advisors stock holdings — or 7% of the value reported in the filing — was almost evenly split between Apple and Microsoft stock.
Two-thirds of Ensign Peak Advisors’ reported stock holdings came from 100 companies or mutual funds. Of those 100, the plurality of the investment — 26% — was in the technology sector.
The next two biggest sectors were health care, including Johnson & Johnson and Merck stocks; and financial services — stocks such as Bank of America and Berkshire Hathaway.
There also were investments in two Utah-based companies.
The fund reported owning $91.8 million of stock in Zions Bank. That bank can trace its history to a bank founded in 1873 by LDS Church President Brigham Young. The church sold its majority stake in Zions in 1960.
Ensign Peak Advisors also owned $76.7 million of stock in Pluralsight, an online education company based in Farmington.
While the LDS Church owns for-profit insurance and personal investmentbusinesses as well as radio stations and Salt Lake City’s NBC affiliate, KSL-Channel 5, Ensign Peak Advisors invested in those businesses’ competitors. It owned stock in SiriusXM, the three companies that combine to own the local ABC, CBS and FOX affiliates, and in The New York Times Co.
The church counsels its members to not consume tobacco, alcohol or hot caffeinated drinks. And the portfolio reflects that. There were no cigarette or beer manufacturers, nor was there an investment in a coffee chain, such as Starbucks.
Of the 30 companies that comprise the Dow Jones Industrial Average, Coca-Cola is the only one Ensign Peak Advisors did not invest in. The fund didn’t own stock in soda makers PepsiCo or Keurig Dr Pepper, either.
Caffeinated sodas are not part of the church’s health code, known as the Word of Wisdom.
Part of the picture
The SEC filing discloses only Ensign Peak Advisors’ holdings in publicly traded companies or funds, and such filings do not include investments in real property or private companies.
Part of the picture
The SEC filing discloses only Ensign Peak Advisors’ holdings in publicly traded companies or funds, and such filings do not include investments in real property or private companies.
As to Clarke’s concern, Quinn suspects only journalists, academics and historians will be interested in studying the portfolio. He doubts rank-and-file Latter-day Saints will refer to the SEC document for investment advice.
“Members of the church don’t need to do extensive research to invest in blue chip stocks,” Quinn said.
Schwartz, the law professor, believes any penalty Ensign Peak Advisors might face for failing to file a quarterly report until now would be light by the standards of a multibillion-dollar fund. He found one case in which an investment firm failed to file the necessary reports for three years. The SEC issued a fine of $100,000.
“It doesn’t seem like there would be huge penalties,” Schwartz said.
If Ensign Peak continues issuing quarterly reports, the next one would be available on the SEC website in mid-May.
The Nielsen brothers’ complaint, first reported by The Washington Post, drew international attention to the church’s financial interests and shocked many outsiders and members of the faith. The brothers argued that the church was violating tax laws by not spending more of this reserve on charitable purposes.
The church’s governing First Presidency — made up of church President Russell M. Nelson and his counselors, Dallin H. Oaks and Henry B. Eyring — rejected that allegation in a news release, saying the faith “complies with all applicable law governing our donations, investments, taxes and reserves.”
Other Latter-day Saint officials later said they didn’t previously disclose how big the financial reserve had grown because they didn’t want to discourage members from tithing, which is donating 10% of one’s income to the faith.
The church collects that tithing, which it uses to run its operations around the world, and it sends the excess to Ensign Peak Advisors to invest.
Church officials have called the fund a “rainy-day account” to help pay for operations in poorer parts of the world — such as Africa, where the faith is booming — and at some future time when member donations stagnate.
Financial Portfolio: What It Is, and How to Create and Manage One
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Investopedia / Tara Anand
What Is a Financial Portfolio?
A portfolio is a collection of financial investments like stocks, bonds, commodities, cash, and cash equivalents, including closed-end funds and exchange traded funds (ETFs). People generally believe that stocks, bonds, and cash comprise the core of a portfolio. Though this is often the case, it does not need to be the rule. A portfolio may contain a wide range of assets including real estate, art, and private investments.
You may choose to hold and manage your portfolio yourself, or you may allow a money manager, financial advisor, or another finance professional to manage your portfolio.
KEY TAKEAWAYS
- A portfolio is a collection of financial investments like stocks, bonds, commodities, cash, and cash equivalents, as well as their fund counterparts.
- Stocks and bonds are generally considered a portfolio's core building blocks, though you may grow a portfolio with many different types of assets—including real estate, gold, paintings, and other art collectibles.
- Diversification is a key concept in portfolio management.
- A person's tolerance for risk, investment objectives, and time horizon are all critical factors when assembling and adjusting an investment portfolio.
- Portfolio management is an important financial skill for active investing.
Understanding Financial Portfolios
One of the key concepts in portfolio management is the wisdom of diversification—which simply means not putting all of your eggs in one basket. Diversification tries to reduce risk by allocating investments among various financial instruments, industries, and other categories. It aims to maximize returns by investing in different areas that would each react differently to the same event. There are many ways to diversify.
How you choose to do it is up to you. Your goals for the future, your appetite for risk, and your personality are all factors in deciding how to build your portfolio.
Regardless of your portfolio's asset mix, all portfolios should contain some degree of diversification, and reflect the investor's tolerance for risk, return objectives, time horizon, and other pertinent constraints, including tax position, liquidity needs, legal situations, and unique circumstances.
The word "portfolio" comes from the Latin folium, meaning to "carry leaves" (as in papers). Stock and bond certificates were once only issued in paper form, from which this terminology was adopted. Portfolio is also used to describe an artist's collection of works, for similar reasoning.
Managing a Portfolio
You may think of an investment portfolio as a pie that's been divided into pieces of varying wedge-shaped sizes, each piece representing a different asset class and/or type of investment. Investors aim to construct a well-diversified portfolio to achieve a risk-return portfolio allocation that is appropriate for their level of risk tolerance. Although stocks, bonds, and cash are generally viewed as a portfolio's core building blocks, you may grow a portfolio with many different types of assets—including real estate, gold stocks, various types of bonds, paintings, and other art collectibles.
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The sample portfolio allocation pictured above is for an investor with a low tolerance for risk. In general, a conservative strategy tries to protect a portfolio's value by investing in lower-risk securities. In the example, you'll see that a full 50% is allocated to bonds, which might contain high-grade corporates and government bonds, including municipals (munis).
The 20% stock allocation could comprise blue-chip or large-cap equities, and 30% of short-term investments might include cash, certificates of deposit (CDs), and high-yield savings accounts.
Most investment professionals agree that, though it does not guarantee against loss, diversification is a key component for reaching long-range financial goals while minimizing risk.
Types of Portfolios
There can be as many different types of portfolios and portfolio strategies as there are investors and money managers. You also may choose to have multiple portfolios, whose contents could reflect a different strategy or investment scenario, structured for a different need.
A Hybrid Portfolio
The hybrid portfolio approach diversifies across asset classes. Building a hybrid portfolio requires taking positions in stocks as well as bonds, commodities, real estate, and even art. Generally, a hybrid portfolio entails relatively fixed proportions of stocks, bonds, and alternative investments. This is beneficial, because historically, stocks, bonds, and alternatives have exhibited less than perfect correlations with one another.
A Portfolio Investment
When you use a portfolio for investment purposes, you expect that the stock, bond, or another financial asset will earn a return or grow in value over time, or both. A portfolio investment may be either strategic—where you buy financial assets with the intention of holding onto those assets for a long time; or tactical—where you actively buy and sell the asset hoping to achieve short-term gains.
An Aggressive, Equities-Focused Portfolio
The underlying assets in an aggressive portfolio generally would assume great risks in search of great returns. Aggressive investors seek out companies that are in the early stages of their growth and have a unique value proposition. Most of them are not yet common household names.
A Defensive, Equities-Focused Portfolio
A portfolio that is defensive would tend to focus on consumer staples that are impervious to downturns. Defensive stocks do well in bad times as well as in good times. No matter how bad the economy is at a given time, companies that make products that are essential to everyday life will survive.
An Income-Focused, Equities Portfolio
This type of portfolio makes money from dividend-paying stocks or other types of distributions to stakeholders. Some of the stocks in the income portfolio could also fit in the defensive portfolio, but here they are selected primarily for their high yields. An income portfolio should generate positive cash flow. Real estate investment trusts (REITs) are examples of income-producing investments.
A Speculative, Equities-Focused Portfolio
A speculative portfolio is best for investors that have a high level of tolerance for risk. Speculative plays could include initial public offerings (IPOs) or stocks that are rumored to be takeover targets. Technology or healthcare firms in the process of developing a single breakthrough product also would fall into this category.
Impact of Risk Tolerance on Portfolio Allocations
Although a financial advisor can create a generic portfolio model for an individual, an investor's risk tolerance should significantly reflect the portfolio's content.
In contrast, a risk-tolerant investor might add some small-capgrowth stocks to an aggressive, large-cap growth stock position, assume some high-yield bond exposure, and look to real estate, international, and alternative investment opportunities for their portfolio. In general, an investor should minimize exposure to securities or asset classes whose volatility makes them uncomfortable.
Time Horizon and Portfolio Allocation
Similar to risk tolerance, investors should consider how long they have to invest when building a portfolio. In general, investors should be moving toward a conservative asset allocation as their goal date approaches, to protect the portfolio's earnings up to that point.
For example, a conservative investor might favor a portfolio with large-cap value stocks, broad-based market index funds, investment-grade bonds, and a position in liquid, high-grade cash equivalents.
Take, for example, an investor saving for retirement who's planning to leave the workforce in five years. Even if that investor is comfortable investing in stocks and riskier securities, they might want to invest a larger portion of the portfolio in more conservative assets such as bonds and cash, to help protect what has already been saved. Conversely, an individual just entering the workforce may want to invest their entire portfolio in stocks, as they may have decades to invest, and the ability to ride out some of the market's short-term volatility.
How Do You Create a Financial Portfolio?
Building an investment portfolio requires more effort than the passive, index investing approach. First, you need to identify your goals, risk tolerance, and time horizon. Then, research and select stocks or other investments that fit within those parameters. Regular monitoring and updating is often required, along with entry and exit points for each position. Rebalancing requires selling some holdings and buying more of others so that most of the time your portfolio’s asset allocation matches your strategy, risk tolerance, and desired level of returns. Despite the extra effort required, defining and building a portfolio can increase your investing confidence and give you control over your finances.
What Does a Good Portfolio Look Like?
A good portfolio will depend on your investment style, goals, risk tolerance, and time horizon. Generally speaking, a good degree of diversification is recommended regardless of the portfolio type in order to not hold all of your eggs in one basket.
How Do You Measure a Portfolio's Risk?
A portfolio's standard deviation of returns (or variance) is often used as a proxy of overall portfolio risk. The standard deviation calculation is not merely a weighted average of the individual assets' standard deviations - it must also account for the covariance among the different holdings. For a 2-asset portfolio, the standard deviation calculation is:
σp= (w12σ12 + w22σ22 + 2w1w2Cov1,2)1/2
The Bottom Line
A portfolio is a cornerstone of investing in the markets. A portfolio is comprised of the various positions in stocks, bonds, and other assets held, and is viewed as one cohesive unit. The portfolio components, therefore, must work together to serve the investor's financial goals, constrained by their risk tolerance and time horizon. Portfolios can be constructed to achieve various strategies, from index replication to income generation to capital preservation. Regardless of the strategy, diversification is seen as a good way to reduce risk without sacrificing the portfolio's expected return.
Find out what a hypothetical investment would be worth today.
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