LaGrange County Community Foundation | About Us

Investment Policy
At LCCF we are committed to preserving the purchasing power of assets entrusted to our care. Philanthropic dollars should provide as much service 100 years from now as they do today. Investment and distribution decisions are made with this goal in mind.

Payout and Investment Policy Summary

I. Payout Policy

• Payout target 4%

1. Based upon 3 year rolling average return and 12/31 asset value

2. Payout cannot exceed actual investment results (after fees), unless accumulated surplus is sufficient (beyond return plus inflation).

3. New accounts to the foundation will not receive their first payout until they have been invested for one complete calendar year. After one year is completed, payout for the new account will be based upon the previous year’s actual return, not the three (3) year rolling average of the foundation. The three (3) year rolling average payout will only begin after the new account has been invested for three (3) complete calendar years.

II. Investment Policy
Finance committee has fiduciary responsibility and authority for setting and executing the financial policies

• Objectives

1. Equal 8.5% annualized gross returns

2. Equal a blended index comparable to the actual money managers blend

3. Equal an index of 10% International ; 60% Standard & Poor’s 500; 25% Lehman Bros. Govt. Credit Intermediate Bonds; 5% Cash

4. Achieve minimum growth of CPI +5%

Note: All performance numbers are before fees. Objective #1 is our primary criteria; objective #2 is our second criteria.

• Asset Allocation

	Target	Range
Equity	70%	50-85%
Fixed Income	25	15-50
Cash	5	0-10

• Syle Segmentation

Small Cap	15	5-25
International	10	0-15
Socially Responsible	5	0-10
Large Cap Value	15	10-30
Large Cap Growth	10	10-30
REIT's	5	0-10
Convertible Bonds	10	0-20
Bonds	25	10-50
Cash	5	0-10
Total	100%

• Investment Process

1. Select and utilize service and expertise of a financial consultant

2. Select money managers based upon their unique expertise and fit within the “asset allocation” and “style segmentation”

3. Monitor performance quarterly

4. Review asset management semi-annually with the consultant; conference calls should be possible as needed to meet market conditions and specific needs of the finance committee

a. An agenda should be set for each review … should reflect both the committee and the consultant input … sufficient time should be allowed for thorough review plus “educational” input to the committee

b. Items to regularly be covered (but not restricted to):

i. Overview of past market period(s) and input on LCCF assets

ii. Review of overall performance

iii. Review of individual money managers … especially those who are causing concern

iv. Review of asset allocation going forward

v. Review outlook for payout

vi. Educational topic related to foundations and investment management

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