Investment Policy

  1. The following statement represents The Encounters With Canada Support Foundation Investment Policy.  It is a target policy and it is designed to:
    • 1.1    maximize middle to long term growth within the Permanent Endowment Funds without compromising the safety of invested principal.
    • 1.2    re-invest interest, dividend and capital gain income within the Permanent Endowment Funds until the Foundation Board decides to use that income for Foundation purposes,
    • 1.3    eliminate market fluctuations, while achieving modest returns for ‘flow-through’ funds by only using cash and equivalents investments (see below) for those purposes. Interest income within this segment of the portfolio will be re-invested until those funds flow through the Foundation.
  2. The Encounters With Canada Support Foundation Board (the Board) will set the investment guidelines for the administration of Foundation funds.  The day to day administration of those investment funds may be handled by:
    • 2.1    A Canadian full‑service brokerage firm which is a member of the Investment Dealers Association and who is also a member of the Canadian Investor Protection Fund; or a committee (The Committee) consisting of members of the Foundation board.
    • 2.2    The Board or its appointed advisors when establishing investment guidelines or making investment decisions shall not be limited to investments authorized by laws for trustees but may make any investment which they may consider advisable, including, without limitation, good quality bonds, preferred shares, large cap stocks, mutual or pooled investment funds, income trusts and R.E.I.T.s or real estate.
    • 2.3    The Board shall not be liable for any loss that may happen in connection with any such investment made in good faith.
  3. Investment Guidelines:
    • 3.1   The investments may be Canadian or international;
    • 3.2   The asset-mix ratio of the securities portfolio within the Permanent Endowment Funds shall be approximately as follows; 5% cash/equivalents, 40% fixed income securities and 55% equities.  This ratio will not apply to ‘flow-through funds’ segment of the Foundation’s portfolio nor to real estate holdings of the Foundation.
    • 3.3   The asset-mix ratio shall be reviewed at least on an annual basis,
    • 3.4   The cash/equivalents segment of the portfolio are limited to chequing account balances, savings account balances, Canada Savings Bonds, Treasury Bills, and Guaranteed Investment Certificates.  This section of the portfolio will only include investments that are covered under the Canada Deposit Insurance Corp. (the bank accounts) or are guaranteed by the Government of Canada.
    • 3.5   The fixed income securities segment of the portfolio could include fully Government of Canada guaranteed bonds.  The fixed-income portion of the portfolio will be invested in a ‘laddered strategy’ of up to 1 - 10 years.  This will be done to maximize the rate of return.  The strategy and criteria for choosing bond dealers in this regard include:
      • 3.5.1  The Committee will request market quotations for bonds from financial institutions that meet the following criteria:
      • (a) One of the five national banks or a national investment firm that has been in operation in our country for a minimum of five years and has a minimum of five billion dollars under management,
      • (b) The specific individual within that firm will have a minimum of ten years experience in the investment business.
      • (c) Quotation requests will be made once a year to all qualified institutions that have expressed an interest in quoting on the first maturity of an existing bond within the Foundation's fiscal year or, at any time during the same fiscal year, on either maturity of another bond or receipt of new money to be invested in the laddered portfolio.
    • 3.6  The equities segment of the portfolio shall be professionally managed within the guidelines set by the Encounters With Canada Foundation Board.
    • 3.7  The equities segment could also include real estate, but its inclusion would not be subject to asset-mix ratio calculations.
    • 3.8  Donated shares must be sold upon receipt. 
    • 3.9  Monies accepted by the Foundation for ‘flow-through’ purposes may only be held as cash or equivalents.
    • 3.10  All securities accounts held by within the Foundation’s portfolio may only be cash accounts; there may be no margin accounts.
  4. This policy will be reviewed annually, at the Board meeting that falls closest to the anniversary of its adoption.

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