The Operating Fund provides high liquidity to meet the current (0-1 year) financial obligations arising from operations.
II. Objectives of Operating Fund:
A) Preservation of Capital
III. Target Asset Allocation:
The Operating Fund will be made up of cash and cash equivalents with less than a twelve month original maturity and will be FDIC insured. These funds will not necessarily be held with the Investment Advisor. Amounts in this account will fluctuate based on cash flow during the year. When there is not sufficient cash to cover operating activities funds will be released from the Special Projects Fund and then from the Long Term Funds if necessary.
IV. Roles & Responsibilities:
• The Finance Director will monitor the Operating Fund and report to the Executive Director.
• The Executive Director will notify the Finance Committee of deficiencies and may transfer of funds from the Special Projects or Long-Term Fund to the Operating Fund.
• In the case of a surplus, the Executive Director will notify the Finance Committee and may transfer of funds from the Operating Fund to the Special Projects or Long-Term Fund.
Special Projects Fund
The Special Projects Fund is a segregated fund for project program development, or planned shortfall from Operations which requires expenditure of reserves that have been identified with a one to three year time horizon.
VI. Objectives of Special Projects Fund:
A) To allow Lamaze to plan for, and fund, significant projects that support the mission of the organization.
B) To allow Lamaze to plan for, and fund, significant projects that are beyond the scope of the annual operating budget,
C) To allow Lamaze to plan for, and fund a planned or unplanned operating deficiency.
VII. Target Asset Allocation:
The Special Projects Fund will be made up of 100% fixed income and will be maintained in a separate UBS Fund from the Long-term Fund. If superior returns can be attained outside UBS these funds may be held separately or combined with operating cash to maximize return.
VIII. Roles & Responsibilities:
• The use of the funds in the Special Projects Fund is subject to approval of the Board.
• The Finance Committee may preapprove projects, contingent with the availability of money in the Special Projects Fund, so that these projects can be pursued in the event that funds become available due to positive financial results.
The target range of the Special Projects Fund is set by the Net Asset Policy. The current policy target is summarized below:
Lamaze Special Projects Fund in combination with the Long-Term Fund will identify funds to be utilized for special projects. Special Projects funds will span from the bottom target Long-term fund range or 50% with Committee approval. Long-Term Funds over 75% will automatically be considered part of the Special Projects Fund and would not require additional approval to spend these funds. If the Net Assets increase greater than 100%, the Committee will create a five year plan to be used for special projects that would provide added value to the members of Lamaze and return Net Asset to the policy target.
X. Amendment of Investment Policy
The Finance Committee will review the balance in the Lamaze Special Projects Fund no less than once each year and make a recommendation to the Lamaze Board of Directors if adjustments to the balance need to be made.
Long Term Fund
Long-Term Investment Fund: Funds with a minimum three year investment horizon.
XII. Purpose and Objectives of Investment Fund:
A) To grow the value of the portfolio over a full market cycle, this is typically defined as three to five years.
B) Balance growth while protecting the portfolio value against large losses (defined as: > 10% in a 12 month period).
C) Exceed the CPI + 2%
D) Exceed 50% of the manager peer group on a rolling three to five year basis
E) Exceed benchmark on a three to five year basis
Based on the moderate mix allocation table (as defined by UBS). We have created the target allocation below:
|Moderate Mix - Target Asset Allocation Table|
|Asset Class||Minimum Weight||Target Weight||Maximum Weight|
|Cash & Equivalents||0%||2%||15%|
*The portfolio will not contain more than a 60% combined allocation to equities between US and International.
XIII. Roles & Responsibilities:
• The Lamaze Board will, by majority vote during any official meeting, amend the investment strategies, portfolio composition, and/or this investment policy.
• The Finance Committee will annually review the allocation target with updated historical data.
• The Investment Advisor is responsible for monthly and quarterly reporting and updates to the Finance Committee.
• The Executive Director can authorize changes to the investments that are within the policy.
XIV. Prohibited Investments:
The following securities and transactions are not permitted for the Fund EXCEPT as directed by the Investment Advisor within an investment fund (e.g. mutual fund, hedge fund, managed futures fund):
• Letter stock and other unregistered securities;
• Individual commodities or other commodity contracts;
• Short sales or margin transactions;
• Individual uncovered and covered options;
• Investments for the purpose of exercising control of management.
XV. Portfolio Rebalancing:
Given the volatility of the capital markets, strategic adjustments in various asset classes may be required to rebalance asset allocation back to its target range. Rebalancing should take place if there is a deviation form target weight of (+-5%). This should take place every year during the first quarter. Tactical deviations from the target weight that are within the policy limits may be made and reported to the Finance Committee. At any time during the year if policy minimum or maximums are reached, rebalancing should occur.
Approved: April, 1996
Revised: September, 1999; May, 2000; September, 2004; March, 2008, March 2012