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Srbo Radisavljevic
Managing Principal/Investment Advisor

Edge Portfolio Management

City:Northbrook

State: IL



BIOGRAPHY:
At Edge, a low client to advisor ratio allows for personal and customized service for each individual.  Our goal is to work as a team for each client to provide not only portfolio management but wealth coordination and financial planning.  We make every effort to have frequent communication with our clients and to provide timely response to calls and emails.  I also enjoy spending time with my wife and three kids, following Chicago sports, enjoying ethnic cooking, and serving as a school board member for Norridge School District 80.

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Blog - Impact Investing and the Future

Impact Investing is appealing to many investors and is becoming more accessible

| BY Catherine McBreen

Just this past week, Spectrem Group and Financial Advisor magazine held their Innovation Forum in Boston and Impact Investing was one of the topics addressed.  The Innovation Forum focuses on new trends and thought provoking information and is attended by senior strategy and marketing executives.  While innovative ideas from experiential marketing to political polling were discussed, one of the most intriguing presentations concerned Impact Investing.  Not only does this trend appeal to the very wealthy, younger investors are incredibly interested in this type of investment.

For many, Impact Investing is nothing new.   In case you are not one of the enlightened, however, Impact Investing allows wealthy individuals to use their assets to invest in businesses in developing countries and still make a return.  For example, through the use of microfinancing enterprises that have developed around the world, your dollars can go directly to a chicken farmer in Uganda or a cab driver in Costa Rica.  The dollars are not just donated. Individuals in developing countries take out a loan to create a business.  They must repay the loan with interest.  In most cases it is similar to investing in debt.  As an investor you are financing a loan.  In a few cases, investors actually purchase equity in the company with the hope that it will eventually generate dividends.

How do investors know whether the assets actually go to these small businesses and how does the repayment work?  Thousands of small microfinancing operations are developing.  Investment managers often work directly with these organizations who review the local business and manage the loans.  Sometimes these loans are offered at very high interest rates.  For example, a $6 loan may have a 30 percent annual interest rate.  These rates, however, are much lower than they can receive through local hoodlums offering loans at daily rates.

At the Innovation Forum, Ron Cordes, Co-Chairman of Genworth Financial Wealth Management, discussed his own experience with impact investing.  Cordes indicated that after comparing his investments in the markets to the investments he had made in impact investments, his returns were not incredibly different.  Link the positive return to the feeling achieved due to helping others, and Impact Investing becomes extremely attractive. 

Mr. Cordes also discussed a trip that he had taken to Uganda to see how his investments were performing.  While in a remote village, the women rallied to thank their investors.  Most had never seen an American.  They were grateful that the investors had helped them create a business because it allowed them to teach their children the importance of developing an income stream rather than merely relying upon handouts.

The ability to invest in this type of investment is quickly becoming available to those with lower levels of wealth.  One of the most popular websites that allows investors to become involved in Impact Investing is Kiva.org.  Donations on this site can be as low at $5.   The site highlights stories and shows how close specific individuals are to achieving their investment goals.

Cordes spoke about ImpactAssets.org.  On this site, investors can currently donate via a donor advised fund with a minimum investment of $5,000.  One of the more exciting aspects of Impact Assets is its future goal of allowing financial advisors to assist their clients in donating to impact investments.  Similar to the concept of packaging managed accounts, Impact Assets will offer ways for advisors to assist investors in accessing these investments in the future.  Visit the site to learn about various investment managers as well as potential opportunities.

Spectrem Group recently completed research with investors with $25 Million of net worth.  In this research we asked investors if they were familiar with Impact Investing and if they have considered Impact Investing.  In total, 34 percent of investors were familiar with impact investing.  That number increased to 39 percent for those under the age of 55.  While 25 percent of the total number of investors were interested in impact investing, 39 percent of those under 55 had considered it.

Generally, trends trickle down from wealthier investors to less wealthy investors and it can be anticipated that these types of investments will be very popular with the millennial generation.  College age and slightly older individuals consistently indicate their interest in helping others.   This year, in fact, my own college age daughter has asked her aunts and grandparents to make a donation on her behalf to a specific organization rather than purchasing a Christmas gift for her.  (She is still anticipating a gift from me, I presume, since I wasn’t part of the heartfelt email!).

As impact investing becomes more popular and easy to access, it will continue to increase in popularity.  As long as no outrageous scandals or frauds are committed, it will become a mainstream investment choice sooner rather than later.



About the Author


Catherine McBreen



Catherine S. McBreen is President of Millionaire Corner.  McBreen plans and develops content for Millionaire Corner.  Catherine balances editorial content to meet the informational needs of both new and seasoned investors.  She designs special monthly surveys on topical issues affecting the economic environment.

McBreen has a B.S. in speech communications from Northwestern University and a J.D. from DePail University College of Law.  She is a member of the American Bar Association, the Illinois Bar Association, and the Chicago Bar Association.

Well-known for her expertise in the affluent and retirement arenas, McBreen is a frequent speaker at industry conferences.  She has been quoted widely by the financial media, including The Financial Times, The Wall Street Journal, Research, Private Asset Management, On Wall Street, Reuters, Bloomberg News, The Dow Jones Newswires and Worth.  Cathy has appeared as a guest on CNBC Closing Bell, First Business Morning News, Neal Cavuto at Fox Business News, ABC and CBS radio.

McBreen is co-author with Spectrem President George H. Walper, Jr. of the book "Get Rich, Stay Rich, Pass It On: The Wealth-Accumulation Secrets of America's Richest Families" (Portfolio, January 2008)

Catherine is the mother of four and is involved in many school and community events.