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Endowment Fund
Investment Policy Statement

This Investment Policy Statement defines how and by whom the assets of the Children's House Endowment Fund shall be invested to achieve its desired objective.

The primary objective of the Endowment Fund is to produce a return from capital appreciation and income that will allow for the distribution of 5% of the value of the Fund per year to the operating account of Children's House. The second objective of the Endowment Fund is to produce a return of 3% or greater in excess of the annual 5% distribution amount to provide protection from inflation and to increase the value of the Endowment Fund itself.

The Finance Committee, appointed by the Board of Children's House, shall oversee the investment of the Fund's assets. Within the context of the Fund's objectives and the then current investment environment, the committee shall determine the percentage allocation of the Fund's assets between fixed income and equity investments. The Finance Committee may manage the Fund's assets in part or entirely, or recommend that outside managers be selected to manage the assets in part or entirely. The recommendation of the Finance Committee concerning investment management issues must be submitted to the Board for discussion and approval. The investment performance of the investment managers shall be monitored by the Finance Committee and reported to the Board on a quarterly basis or more frequently if necessary. The Finance Committee shall determine an appropriate set of comparative Indices to use in examining investment performance and present its findings at the end of each quarter.

The Finance Committee, acting as an investment manager, or any firm or individual selected to so act, shall only be permitted to invest the assets of the Endowment Fund in the following types of securities:

  • Money funds and similar cash equivalents
  • CDs, Treasury Bills, Federal Agency Notes and Bonds, A, AA, and AAA rated corporate bonds and Govern National Mortgage Pass Through Securities
  • Preferred Stocks, Convertable Preferred Stocks and Convertable Bonds
  • Open Ended, No Load and Exchange Traded Mutual Funds
  • The Finance Committee may recommend any of the following types of investment management organizations to the Board for consideration:
  • Equity Investment Managers: common stocks only
  • Fixed Income Investment Managers: primarily bond investments
  • Dual Managers: both bonds and stocks

Mutual Fund Companies
The Investment Policy Statement is intended to provide prudent and reasonable guidance concerning the investment of the Children's House Endowment Fund to the members of the Board, the Finance Committee, and those charged with investment responsibilities.

36 Pea Patch Lane | Eastsound, Washington 98245 | 360.376.4744
Orcas Island Children's House is a tax-exempt 501(c)3 organization, and all contributions are tax deductible to the full extent of the law.
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