Leadership & Governance

Investments

Operating Fund

The fund’s objectives shall be preservation of capital and liquidity and shall be invested as follows:
•    Federally insured certificates of deposit not to exceed one hundred thousand ($100,000) dollars per institution.
•    Money market funds.
•    Checking accounts in federally insured banks and savings and loans.
•    Direct obligations of the US Government, its agencies, and instrumentalities.
•    Agency discount notes.
•    Repurchase agreements.
•    Commercial paper rated A1/P1.
•    The maturity of investments for the operating fund shall be limited to one (1) year or less.

Reserve Fund

The fund’s objective shall be long-term capital growth. It is understood that fluctuating rates of return are to be expected in the securities markets. These funds shall be invested in a manner consistent with ERISA guidelines for diversification and risk. Accordingly, the expectations for the account's performance over a five (5) year period shall be to achieve the following:
•    The account's total return should equal or exceed the performance of the S&P 500 Index, EAFE Index, and the Shearson Lehman Intermediate Bond Index.
•    The portfolio should be invested to minimize the likelihood of low negative total returns defined as a negative return greater than ten (10) percent in a calendar year or three (3) consecutive negative quarters.

Investment Guidelines

The Finance and Investments Committee in consultation with the investment advisor shall have broad latitude in selecting suitable assets to invest these funds properly. This policy allows substantial discretion in asset allocation for the purpose of increasing investment returns or reducing risk exposure. A registered investment advisor shall professionally manage the funds using recognized principles of asset management to meet long-term growth objectives. The investment advisor shall be free to select securities for investment of these assets that he or she deems appropriate using commonly accepted methods of security analysis with the following classes of investments specifically disallowed:
•    Private placements.
•    Lettered stock.
•    Commodity and futures trading.
•    Short selling.
•    Margin transactions.
•    Gems.
•    Objects of art.
•    Stocks with a share price of less than five ($5) dollars.
•    Equity or index options.
•    Speculative derivatives.

Investment Reporting

The investment consultant shall prepare a report at least quarterly for the ASLA chief financial officer and Finance and Investments Committee. The report shall include a schedule of investments including investment returns to date and any other pertinent information necessary to evaluate adherence to these investment objectives and guidelines.

ASLA Administrative Policy:  2016