Glenmede - Investment and Wealth Management

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• Creating Your Investment Portfolio

Creating Your Investment Portfolio

Developing an investment portfolio is a collaborative and interactive process that involves both your portfolio manager and Glenmede’s Investment Policy Committee. This process is comprised of three basic elements:

Step 1: Establishing a Long-term Investment Policy

An investment policy is a roadmap to guide the construction of an investment portfolio. This policy reflects two critical decisions: how much risk is appropriate and how much liquidity is required? For example, low-risk portfolios may reflect a large allocation to fixed income; high risk could include more equities. Publicly traded stock and bond portfolios have a high degree of liquidity while hedge funds, private equity, and real estate have far less. The portfolio manager will collaborate with the organization to craft an investment policy based on a fundamental understanding of goals, risk tolerance, and liquidity needs. These asset allocation guidelines are established and recorded to ensure the investment portfolio meets expectations.

Step 2: Incorporating Glenmede’s Investment Strategy

A diversified portfolio of assets makes sense over the longer term. There will be points in time where asset classes and strategies will move in and out of favor. The portfolio manager must understand the “big picture” economic and market environment. This is accomplished by working with the Investment Policy Committee comprised of Glenmede’s Chief Investment Officer and the senior research and analytical resources of the firm. Their role is to continually monitor and evaluate the economy and the markets. Daily and weekly meetings are held to determine if assets, strategies, and securities should be reallocated to reflect current conditions.

Step 3: Implementing an Investment Strategy

Based on the organization’s investment policy and the Investment Policy Committee’s investment strategy, the portfolio manager creates a recommended portfolio allocation to different securities and managers, capturing the best thinking of the firm as well as any of the organization’s particular preferences or restrictions. In creating an optimal portfolio, the manager has an extensive list of choices to consult, including proprietary stock and bond research as well as a well-developed open architecture program (Glenmede’s Manager Alliances Program).