VCOM Institutional Policy and Procedure Manual

VCOM Policy and Procedure

Policy #B003

9.6 Asset Allocation Guidelines for Long Term Reserves Investment of the assets may be in accordance with the following Aggregate Plan Asset Allocation Guideline (market value) with Mid-Term investments or greater when access to liquid assets is not anticipated for a period of one to two years. a. The preferred asset allocation of the total portfolio should be 80% equities and 20% fixed income, plus or minus 10%. Re-balancing may occur as necessary. b. Cash equivalents shall be purchased as deemed appropriate or necessary by the President and CFO, and will reduce the preferred asset allocation noted above c. In order to achieve a prudent level of diversification, the securities of any one company or state agency or government should not exceed 5% of the total fund 9.7 Asset Allocation Guidelines for Short Term Reserves Investment of the assets may be in accordance with the following Aggregate Plan Asset Allocation Guideline (market value). a. 100% of this portfolio should always be invested in cash equivalents, fixed income vehicles that mature in 3 years or less, or ETFs and mutual funds that invest in fixed income securities that mature within 3 years or less b. Maximum maturity or average life of any single security shall not exceed 3 years c. The overall duration of the total portfolio will not exceed 1.1 years. d. Where the credit ratings of Moody’s and S&P differ, the lower rating will be used. e. No more than 10% of the total fixed income portfolio can be invested in non-investment (high yield) grade bonds. f. Mutual Funds and Exchange Rated Funds (ETF’s) are eligible investments. Mutual Funds and Exchange Rated Funds (ETF) are exempt from individual credit restrictions. Cost All costs associated with the management of the investments shall be paid by the investments, not the operating budget 9.9 Transferring of Assets to VC Endowment Trust The President and CFO will report the Long Term budget to the Board of Directors and the Investment Committee on an annual basis to determine what assets are not needed within the next 5 years. Upon approval of the Board of Directors, that amount will be transferred to the VC Endowment Trust. The Investment Committee for VCOM will determine what assets are to be transferred. The transfer of assets can include current securities or cash if liquidity. The VC Endowment Trust is established to only accepts funds from VCOM and to only provide support for VCOM. 10 DURATION OF POLICY The Investment Policy is effective as of the date above and shall remain effective until amended or terminated. 9.8

VCOM Investment Policy

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