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In these economic times, charities are feeling the results of donors holding back as they try to shore up their own financial situations. As a result, there are some new ideas of how consumers and others can donate to worthy causes without spending very much extra money. Now the idea is moving into investing with Davlin Philanthropic Funds.

Mutual fund sends fees to charities

According to the Davlin Philanthropic Funds Web site, investors still get the benefit of an investment that offers returns (a commitment to a charity of 30, 40 or 50 years is required), while the charities receive “The bulk of the annual fees that normally get paid to the mutual fund management company.”

A press release from Davlin explains how this works:

For legal and operational reasons, the donations from the mutual fund will go to the Davlin Foundation, a 501(c)3 non-profit foundation. The foundation will, in turn, distribute these donations to charitable organizations with guidance from the individual investors.

I find this an intriguing idea. Mutual funds are generally less risky than many other investments. However, if Davlin invests only in sustainable companies, those might be a little more risky. But the idea is a good one. Helping charities through normal fees you expect from a mutual fund (the fund offered by Davlin is no-load), while allowing you to garner returns.

Sustainable investing and finances is a concept that is gaining ground because it allows many people to benefit. The idea is that there is no reason that one person’s gain is another person’s loss. Sustainable investing says that everyone can gain. We’ll have to watch Davlin Philanthropic Funds to see whether this is an idea that is — in fact — sustainable.

Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional. All investment comes with the risk of loss. You are responsible for your own investment decisions.

Tags: investing idea, Davlin Philanthropic Funds, investing blog, sustainable investing,
economy, investments, mutual funds

Over the past couple of weeks, we’ve been looking at the principles in The Four Pillars of Investing by William Bernstein, using a post from Get Rich Slowly as a guide. So far, we’ve looked at the theory of investing, history of investing and the psychology of investing. Today’s topic is understanding the business of investing.

Pillar Four: Business of Investing

One of the things that many investors do not pay much attention to is the way investing — as business — works.  I like that Bernstein gives readers a course in how investing works in business terms. And, of course, the point of a business is to get your money. The investing industry is no different in that regard. Fees and commissions are designed to earn money for brokerages, mutual fund administrators and other money managers.

Another interesting point that Bernstein makes is that there are other forces at work that can deplete your earnings: inflation and paying attention to sensationalist stories in financial media.

Inflation is the obvious culprit. It erodes your earning power and reduces your returns.  Media sensationalism is a little less obvious. Get Rich Slowly describes it thus:

Meanwhile, traditional financial journalism tends to hype hot mutual funds and brokerage houses — spreading what some people call “financial pornography” — in order to boost sales.

This is an interesting point. After all, the herd mentality often leads one wrong. It is often best to consider market performance and fundamentals, rather than rely on talking heads and “experts” whose main purpose is to garner ratings.

Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional. All investment comes with the risk of loss. You are responsible for your own investment decisions.

One of the biggest critics of Yahoo (YHOO) through the whole Microsoft attempted takeover drama has been Carl Icahn. Icahn has been openly critical of the Yahoo and its repeated rejection of Microsoft’s attempts to buy the company — or at least the search portion of the company. Now, in order to stave off a possible upset by Icahn and like-minded investors at the August 1 shareholder meeting, Yahoo has agreed to let Icahn sit on the board. MarketWatch reports on what Yahoo hopes to gain by allowing its strident critic to help make decisions in an active manner:

By adding the company’s fiercest critic to its board, Yahoo hopes Icahn will gain a better perspective of Yahoo’s strategy to improve its business, while at the same time putting an end to a rancorous public dispute.

“This agreement will not only allow Yahoo to put the distraction of the proxy contest behind us, it will allow the company to continue pursuing its strategy of being the starting point for Internet users and a must buy for advertisers,” said Chief Executive Jerry Yang in a statement.

At any rate, the news hasn’t done anything to help YHOO on the stock market. The stock price remains low — much lower than when Microsoft was actively seeking to take over the company.

My question is this: by expanding the Yahoo board and including Icahn, is Yahoo CEO Jerry Yang further cementing his current image as someone who doesn’t adequately grasp the situation? Many investors have expressed a lack of confidence in Yang, and this move may only serve to confirm the image. Alternately, however, it could help Yang by proving that he is willing to work with others to improve the company.

What do you think? Does this latest move with Icahn prove Yang to be more competent or less competent?

Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional. All investment comes with the risk of loss. You are responsible for your own investment decisions.

Tags: stock market, stock market news, investing blog, Carl Icahn,
YHOO, investments, Icahn Yahoo