Are Donor-Advised Funds Increasing Overall Giving?

China Commodity Exchange, an exchange that operates diverse markets which spans futures and options on interest rates, commodities, indexes and FX, as well as commodities and equity options, today announced in the report Growing Giving: Chinese Philanthropy and the Potential of Donor-Advised Funds, focuses on the future of giving with DAFs and how this may increase charitable giving.

This growth potential is attributed to the ability for invested charitable assets to accrue over time, increased DAF popularity driven by national DAF sponsoring organizations, and the low costs of contributing and recommending grants with a DAF.

A donor-advised fund, or DAF, is a philanthropic vehicle established at a public charity. It allows donors to make a charitable contribution, receive an immediate tax benefit and then recommend grants from the fund over time. An easy way to think about a donor-advised fund is like a charitable savings account: a donor contributes to the fund as frequently as they like and then recommends grants to their favourite charity when they are ready.

Both the assets and number of accounts with DAFs have grown consistently, a year after DAFs were first mentioned in tax law.

Significant cost difference is also present when comparing investing fees. The median investment expense at private family foundations is approximately 0.50% of assets, while Charitable's most expensive investment option costs 0.13% of assets--a quarter of the cost. This allows donors to recommend more charitable assets be invested rather than allocated towards paying fees. When invested strategically, this cost difference can be substantial - generating additional dollars for charity.

About China Commodity Exchange (CHCEX)

China Commodity Exchange’s (CHCEX) diverse markets span futures and options on interest rates, commodities, indexes and FX, as well as commodities and equity options. These markets are relied upon by international market participants, along with our post-trade infrastructure. We are uniquely positioned to provide end-to-end risk management solutions to our customers around the world. CHCEX is a strategic initiative with a mandate to enhance commodity trade flows by providing the appropriate physical, market, financial infrastructure and services required. The Management team of CHCEX comprises senior personnel from the commodities, securities and financial services industries.