Marquette Foundation Investment Policy 

PURPOSE

The purpose of this Investment Policy Statement (“IPS”) is to communicate the investment goals, objectives, constraints, benchmarks and criteria of the Marquette Catholic High School Foundation (“Foundation”) for its endowment and any Investment Advisors that are hired. These policies will be reviewed annually by the Investment Committee and revised as needed to ensure they adequately reflect any changes in the philosophy of the Foundation or the capital markets. It is understood that there can be no guarantee about the attainment of the goals or investment objectives outlined herein.

This IPS: 

  • Sets forth a plan to manage the investment assets and discusses the selected asset classes, allocations among these classes that are expected to produce a sufficient level of overall diversification and total return over the appropriate time horizon;
  • Provides guidelines that are intended to keep the portfolio’s level of overall risk and liquidity within acceptable limits;
  • Establishes criteria to review, evaluate and compare the performance results achieved by the investments on a periodic basis; and
  • Facilitates effective communications between Marquette High School Foundation, a Investment Advisor, investment managers, and custodians that may hired. 

Investment Philosophy

Portfolios will be invested and monitored for total return (appreciation plus income) on portfolio assets. Risk will be managed through a disciplined and diversified investment process.  If hired, an Investment Advisor will acknowledge its fiduciary status and will act in a manner consistent with the investment policy statement. The assets  will be managed in accordance with the Prudent Investor Rule.

Foundation Profile

The Marquette Catholic High School Foundation Endowment is comprised of sub-accounts. The general purpose of each account is set forth in this document or each account’s respective governing document. For example, endowments or scholarship accounts set up prior to the formation of IPS.

The Foundation has a number of annual disbursement commitments; therefore, there is a need to have sufficient liquid assets available.

Investment decisions are made by the Foundation’s Board of Directors through its Investment Committee.

Investment Objectives

Marquette High School Foundation has the following long-term goals for investment capital: 

  • Current Income
  • Capital Appreciation
  • Financially support Marquette Catholic High School

Investment Guidelines

Time Horizon

The investment guidelines are based upon an investment horizon of 10 years or greater  therefore, interim fluctuations should be viewed with appropriate perspective.  Similarly, the Foundation’s strategic asset allocation is based on a long-term perspective.

Income Taxes

The Foundation’s investment managers should be aware that this is a non-for-profit organization.  Tax efficient investment management is therefore, not a priority, granting added flexibility if required.

Risk Tolerance

It is important to recognize the difficulty in achieving the Foundation’s objectives in light of the uncertainties and complexities of contemporary investment markets.  The Foundation has recognized and acknowledged that some risk must be assumed in order to achieve the long-term investment objectives.

In establishing the risk tolerances of the IPS, the ability to withstand short and intermediate term variability was considered.  The Foundation’s prospects for the future, current financial conditions and several other factors suggest collectively that some interim fluctuations in market value and rates of return may be tolerated in order to achieve the longer-term objectives.

 Asset Class Definitions

The Foundation agrees with the assumption that the investment risks and returns produced by the portfolio will be largely a function of the asset class mix established by this IPS.  The following asset classes may be utilized for the asset allocation analysis:

Taxable Broad (U.S.) Fixed Income – High quality fixed income securities with an average duration of 3-15 years.  This asset class is considered representative of the performance of all unmanaged domestic, dollar-denominated, fixed rate, investment grade bonds.

Large Cap Equities – Domestic equity securities similar in size to the S&P 500 index, generally $10 billion market cap or higher.

Mid Cap Equities – Domestic equity securities larger than micro small cap equities, but smaller than large cap equities, generally found to range with market capitalization of $3-$10 billion.

Small Cap Equities – Domestic equity securities significantly smaller than those in the S&P 500 generally with a market capitalization of under $3 billion.

International Equities – Mid and large capitalization equities representing companies headquartered outside of the U.S. Securities purchased must be ADRs.( American Depository Receipts)  The endowment will not own foreign ordinary securities.

Equity REITs – Equity REITs are defined as real estate investment trusts with 75% or more of their gross invested book assets invested directly or indirectly in the equity ownership of real estate.

Cash or cash equivalents – Sufficient cash reserves shall be kept on hand to meet the Foundation’s annual commitments for distributions.

Real Estate – Individual tracts of land donated to the foundation.

Investment assets shall be reviewed quarterly and reallocated back to the target allocation established by the Investment Committee when the actual amount invested in any one asset class deviates from its target allocation by more than 15%. When necessary and/or available, cash inflows/outflows will be deployed in a manner consistent with the target asset allocation. 

Screening

The Marquette Catholic High School Foundation views its investments as an integrated component of its overall mission.  Investments are based on sound, financial analysis consistent with and in support of the Foundation’s values and mission and the principles based on U.S. Conference of Catholic Bishops’ Investment guidelines

 

Responsibilities

 

Investment Committee

The Investment Committee will review the performance of the Foundation’s accounts at four times per year, The review will include:

Year-to-date and cumulative performance compared to the established benchmarks

Adherence to the Foundation’s screens and values

Transactions and transaction costs

The Investment Committee may decide to hire an investment advisor. The Investment Committee will provide the Investment Advisor with information necessary to maintain the accuracy and appropriateness of this IPS, including but not limited to:

  • Any changes to their projected cash flow or liquidity needs;
  • Any changes in risk tolerance or asset allocation constraints; and
  • Any significant change to the Foundation’s assets.

The Investment Advisor

  • Meet face-to-face with the Investment Committee at regular intervals.
  • On a monthly basis, provide the Foundation with an executive summary of valuation changes in their accounts; (monthly statement??)
  • On a quarterly basis, report the percentage variation of each asset class from the strategic allocation for each asset class, and recommend necessary adjustments to bring the actual and target allocations within an acceptable range;
  • On a quarterly basis, evaluate the performance of each investment (individual security, mutual fund or separate account manager) against appropriate benchmarks and, when available, peer groups;
  • On a quarterly basis, provide the Foundation with a performance report that will incorporate an executive summary total portfolio return, returns of each asset class and each individual manager relative to the benchmark for that manager;
  • On a continual basis, review and evaluate material changes in the organization, investment philosophy and/or personnel of the managers being utilized; and
  • On a continual basis, address any other changes in the Foundation’s circumstances that affect their investment portfolio.
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