A. Firm Overview
Bailard, Inc. (“Bailard”, “we”, “us”, “the firm”, or “our”) is a registered investment adviser headquar-
tered in Foster City, California with approximately 73 employees. Bailard was founded in 1969 by
three graduates of the Stanford Graduate School of Business. From its inception, Bailard has had a
focus on education and providing clients with diversification over multiple asset classes.
Bailard has two divisions: Bailard Wealth Management and Bailard Asset Management (previously
“Bailard Institutional”). Bailard Wealth Management provides investment advisory and financial
planning services to investors seeking multi-asset diversification. Bailard Asset Management offers
single asset strategies to separate account clients, mutual funds, and affiliated pooled vehicles.
We maintain a business discipline designed to attract and retain top investment talent, and the av-
erage tenure among Bailard’s 43 key professionals was 15 years. Of the professional staff, 81% have
advanced degrees and/or industry designations, e.g., PhD, Masters, MBA, CFA, CFP®, JD, LLM,
CIMC®, CIMA®, CDFA®, CPWA, and RICP®. Led by Chief Executive Officer, Sonya Mughal, Bailard’s
senior management team is comprised of five individuals with an average tenure at Bailard of 20
years.
B. Ownership Structure
Bailard is a wholly-owned subsidiary of BB&K Holdings, Inc., a privately owned C-Corporation.
BB&K Holdings, Inc. is subject to the oversight of a board of directors which consists of six outside
directors and one Bailard employee, specifically, Sonya T. Mughal (Chief Executive Officer).
We view our independence as the best way to serve our clients well and to provide the scope, stabil-
ity and alignment of interests for continued success. As of March 31, 2023, 52 employees owned ap-
proximately 59% of the firm, with the remaining shares owned by former employees and private
investors.
1 Moreover, as of March 31, 2023, Bailard was 52% owned by women and minorities.
C. Bailard Wealth Management Services
Bailard has been advising high net worth investors for over fifty years. We provide high-touch cli-
ent service, multi-asset class portfolios, and financial planning to help our clients secure their fi-
nancial landscape and achieve their goals. Our advice is based on the needs and objectives of the
specific client.
Bailard Wealth Management Service investment portfolios may include a mix of traditional assets
(core U.S. stocks, international stocks, U.S. bonds and cash equivalents) as well as more specialized
components such as tactical assets, small-cap value stocks, growth stocks, real estate, alternative
investments, as well as sustainable, responsible, and impact investments, which is further dis-
cussed below. Tax issues as well as risk tolerance are considered in building client portfolios. As
active managers, we make shifts in asset allocation in response to changing economic and market
conditions.
Sustainable, Responsible & Impact Investing (“SRII”)
In addition to being informed by traditional financial analysis, many of Bailard’s investment
portfolios incorporate Sustainable, Responsible, and Impact Investing (“SRII”) principles in
1 For further information, please see additional disclosures in Item 11 – Code of Ethics, Participation in Client Trans-
actions and Personal Trading.
their construction and management. Under this approach, our goal is to build portfolios
that perform better on environmental, social, and governance (ESG) metrics than their
benchmarks, and that avoid companies with egregious patterns of corporate behavior. Our
process combines our proprietary ESG Capture® scoring framework with suitability assess-
ments as well as product and industry screens. Our aim is that our portfolios do less harm
to society and the planet, while also reducing exposure to long-term financial risk and
providing market-rate returns.
ESG Capture®. For some Bailard strategies, we score companies on their ESG practices and
performance using Bailard’s ESG scoring framework called ESG Capture®. We use this in-
formation in the building and managing of our portfolios to incorporate ESG leaders and
avoid ESG laggards. Our ESG Capture® process allows us to mitigate exposure to risks in-
cluding climate change; poor corporate governance; undisclosed political giving; poor per-
formance on diversity, equity, and inclusion; and more – while also pursuing investing op-
portunities in the companies performing well on, or providing solutions to, these problems.
Further, ESG Capture® is tailored to individual strategies to address each strategy’s unique
investible universe.
Product & Industry Screens. For some Bailard strategies, we utilize Product & Industry
Screens to remove companies from our investable universe if they misalign with the social
or environmental aims of the strategy in question. Many of our strategies screen out invest-
ments in private prisons, alcohol, tobacco, gambling, adult entertainment, and weapons. In
addition to including the above screens, certain strategies are also extraction- and fossil
fuel-free, while others are specialized to address particular issues, like animal welfare.
Suitability Assessments. When our investment research teams want to learn more from
an ESG perspective about a security they’re considering buying, or if a company makes it
into our investable universe but we have concerns about it from an ESG perspective, we
evaluate the company using a tool called a Suitability Assessment. The Suitability Assess-
ment includes information on the company’s ESG scoring, product and industry involve-
ment, recent news and controversies, and peer benchmarking. Based on these inputs, the
Assessment provides an overall recommendation as to which Bailard portfolio strategies
would be appropriate for ownership of the security in question. Suitability Assessments go
beyond basic ESG and screening approaches, with the goal of leading to better alignment
between companies and the values built into the strategies in which they’re owned.
Impact Investing. Bailard also offers impact investing strategies, which aim to have a posi-
tive impact on society and the planet while providing a return on capital. Clients who
choose to make impact investing a part of their overall investment mix will have the oppor-
tunity to make a positive social and environmental impact by providing direct investment
to companies and projects that align with their values – examples include renewable en-
ergy, decarbonization, diversity and inclusion, job creation, and affordable housing. Our
impact investing strategy options include direct investments in both debt and private eq-
uity vehicles, as well as our own public equity impact investing strategy called Bailard
Broad Impact and Bailard Broad Impact Global.
For some clients in the ESG/SRII strategies, Bailard may also invest the client in a related
funds-only strategy, e.g., Fundamental Large Cap Funds strategy or SRII Large Cap Funds
strategy, that holds a combination of mutual funds and/or ETFs. Some of the mutual
funds/ETF’s held in these strategies apply their own ESG screens, but we do not apply the
Bailard Products & Industry screens to the strategies.
Beyond investing itself, SRII at Bailard includes Corporate Engagement and Thought Lead-
ership. Bailard actively engages with companies in our portfolios, directly and as a part of
stakeholder coalitions, on ESG issues to help ensure favorable outcomes for shareholders,
society, and the planet. And we leverage independent research, written pieces, and media
engagement to illustrate the importance and relevance of these issues.
Other Services provided by Bailard Wealth Management
Depending on client preferences and needs, the services we offer to Bailard Wealth Man-
agement clients may include financial planning, as further discussed below, estate plan
consultation with our Director of Estate Strategy, income tax planning, healthcare plan-
ning, elder care planning, multi-generational family planning, special needs planning, life
insurance and annuity review, executive compensation (review of 10b5-1), and consultation
on outside commercial real estate exposure.
Financial planning services are available to Bailard Wealth Management clients who choose
to engage in this process. After five decades of providing financial planning advice, we can
draw upon a strong library of knowledge and experience. Typically, this is a very fluid pro-
cess, where the financial plan is reviewed in response to changes in personal or financial
circumstances.
Investment restrictions may be established by Bailard Wealth Management clients with regard to
their accounts managed by Bailard. Restrictions may be placed on purchases and sales of certain
securities, industries, sectors and asset classes, etc. Clients may also provide input
regarding in-
come tax recognition, minimization or maximization.
Under certain circumstances, Bailard will provide investment services for these clients without
first undertaking a thorough review of the client’s circumstances, financial or otherwise. This ap-
proach is limited to those clients who instruct us to disregard these circumstances and/or to those
corporate pension and profit-sharing plans which are subject to ERISA.
Please note that, while Bailard takes tax issues into consideration as described above when manag-
ing Bailard Wealth Management client portfolios, it is not an accountant and cannot provide tax
advice. Clients should consult with their tax advisors for such advice. In the context of providing
financial planning services, which may touch on matters that are legal in nature, we would like to
remind clients to consult with their legal advisers as we are not attorneys and cannot provide legal
advice.
D. Bailard Asset Management Services
Bailard Asset Management offers investment strategies in both traditional long-only equity man-
agement and alternative investments. Bailard Asset Management manages the following asset clas-
ses and investment styles:
EQUITY STRATEGIES
In the management of the long-only equity strategies, Bailard Asset Management utilizes quantita-
tive methods to varying degrees that attempt to add value relative to client specific benchmarks.
These quantitative methods are based on an evolution of our quantitative research, which began in
1995.
Strategy Name Description
Broad Impact
The strategy seeks to build a portfolio comprised of companies we
believe will have a net positive impact on society over the short,
Strategy Name Description
medium or long term. The portfolio may include companies in dis-
ruptive and transformative industries. The investment team prior-
itizes companies contributing to the macro-themes of Inclusion
and Sustainability through business practices, products and/or
services, as expressed through 21 micro-themes. The portfolio will
be comprised of companies that in our view can help the planet and
people of all backgrounds thrive.
Broad Impact Global Applying Bailard’s Broad Impact philosophy to an expanded uni-
verse, the strategy seeks to build a portfolio comprised of compa-
nies we believe will have a net positive impact on society over the
short, medium or long term. The portfolio may include companies
in disruptive and transformative industries among the U.S. and
non-U.S. public equity markets. The investment team prioritizes
companies contributing to the macro-themes of Inclusion and Sus-
tainability through business practices, products and/or services, as
expressed through more than 20 micro-themes, as curated for the
global investment universe. The portfolio will be comprised of
companies that in our view can help the planet and people of all
backgrounds thrive.
International
Designed to dynamically respond to the investment environment
and focus on the selection of countries as well as individual securi-
ties.
Micro Cap Value ESG
2
Integrates behavioral finance techniques in an effort to identify
temporarily mispriced equities.
Quality Growth
Seeks to invest in high quality companies with competitive sales
and earnings growth rates. We seek to manage risk through diver-
sification of holdings and economic sectors. Holds 45 to 60 posi-
tions in most but not all the ten economic sectors as defined by
MSCI.
Small Cap Value ESG
Integrates behavioral finance techniques in an effort to identify
temporarily mispriced equities.
Smart ESG ADR
Seeks to combine a robust ESG framework with low tracking error
to the MSCI EAFE Index, a broad developed international market
benchmark.
Smart ESG US All Cap
Seeks to implement a robust ESG framework while maintaining a
low tracking error to a broad market benchmark, the MSCI USA In-
vestable Market Index (IMI).
Technology
3
Invests in the stocks of firms that predominately use technology to
drive their businesses, with exposure primarily to the information
technology sector and, to a lesser extent, such broad economic sec-
tors as telecommunications, industrials and consumer discretion-
ary.
2 This strategy is currently implemented on a portion of the Nationwide Cognitive Value Fund.
3 This strategy is currently implemented on a portion of the Nationwide Bailard Technology & Science Fund.
Strategy Name Description
Technology and Science
Emphasizes the technology and science sectors as well as other
growth industries in the marketplace.
FIXED INCOME STRATEGIES:
Strategy Name Description
Active Fixed Income
Our long-only active fixed income strategy uses a top-down investment
process to develop ways to add value relative to various fixed income
benchmarks for both taxable and tax-exempt portfolios. We generally
construct high-quality portfolios with intermediate duration targets, in
an effort to produce a competitive level of after-tax income while pre-
serving principal.
Laddered Bond
A long-only passive laddered bond strategy that seeks to provide an at-
tractive and predictable level of income while focusing on capital
preservation by investing in high quality bonds.
ALTERNATIVE INVESTMENT STRATEGIES
Bailard Asset Management’s alternative investment strategies pursue a wide range of investment
opportunities.
Strategy Name Description
Real Estate
Encompasses more than 40 years of Bailard’s experience in investing in
and managing real estate portfolios and offers investors exposure to of-
fice, industrial, retail, multi-family residential and other types of com-
mercial properties.
Technology Opportu-
nities
Focuses on small and mid-cap technology companies globally with
strong prospects for above-market growth.
Additional information on Bailard Asset Management’s equity, fixed income and alternative invest-
ment strategies can be found in Item 8.
E. Separate Accounts, Sub-Advisory Services and Pooled Vehicles
Separate Accounts and Sub-Advisory Services
A separate account is a client specific portfolio individually managed in accordance with one of
our long-only equity or alternative investment strategies, subject to the investment policies,
limitations and restrictions of our clients. A separate account could, for example, represent all
or a portion of the assets of a pension plan, endowment, or individuals.
We also offer advisory and sub-advisory services to pooled investment vehicles and mutual
funds.
Pooled Vehicles
Bailard Asset Management currently manages the following affiliated, unregistered pooled ve-
hicles:
• Bailard Real Estate Investment Trust, Inc. (the “Real Estate Fund”)
4
• Bailard Emerging Opportunities Fund I, LP (formerly known as Bailard Emerging Life
Sciences Fund I, LP) (the “EOF”)
As of the date of this Brochure, Bailard is in the process of launching the Bailard Multifamily
Fund, L.P. (the “Multifamily Fund”).
F. Wrap Fee Program
Bailard provides portfolio management services to a small number of wrap fee accounts. These ac-
counts participate in a wrap fee program called Managed Account Consulting (“MAC”) that is spon-
sored by D.A. Davidson & Co., a third-party firm (“sponsor firm”), which is a dually registered in-
vestment adviser and broker-dealer.
While Bailard attempts to manage wrap fee program accounts similarly to non-wrap fee accounts,
wrap fee accounts are administered differently as discussed throughout this document. For exam-
ple, non-wrap fee accounts generally pay advisory fees directly to Bailard. Wrap fee accounts gener-
ally pay a wrap fee directly to the sponsor firm, and Bailard receives a portion of the wrap fee from
the sponsor. Also, wrap fee accounts have limited direct contact with Bailard investment profes-
sionals; the sponsor firm typically has its own relationship with a wrap fee account. In addition,
Bailard places orders for wrap fee account trades differently than for non-wrap fee accounts. For
further information on Bailard’s brokerage practices with respect to wrap fee accounts, please see
Item 12 – Brokerage Practices that follows in this document.
Bailard discloses in Part 1A of its Form ADV that it participates in D.A. Davidson’s MAC program.
For further information on the MAC program, please refer to the D.A. Davidson’s Part 2A of Form
ADV, including Appendix 1 of Form ADV: Wrap Fee Program Brochure. Both of these documents
are available through the SEC’s Investment Adviser Public Disclosure website.
G. Client Assets Under Management
Bailard’s total assets under management were $5.3 billion (including $5.28 billion discretionary and
$16.88 million non-discretionary assets) as of March 31, 2023.