Investment Policy

Investment Policy Statement October 2011

This Investment Policy Statement (IPS) establishes objectives and guidelines for the investment of reserve funds for the North American Millers’ Association (NAMA).

The Finance Committee, in conjunction with the President of NAMA, has been authorized by the Board to retain an Investment Advisor to provide advice on the investment management of its reserve funds.

The authority to review and propose for approval changes in this IPS is the responsibility of the Executive Committee of the Board, with review by the Board of Directors.  The authority for investment discretion and decisions lies, as outlined in this policy lies with the President of NAMA, in consultation with the Finance Committee.

The primary investment objective of NAMA’s reserve funds is to preserve and protect assets of the organization while earning an appropriate rate of return for each category of assets, without undue exposure to risk.  The following are the ranked investment objectives in order of importance:

1. Capital Preservation
2. Current Income
3. Liquidity

Allowable Asset Classes:

1. Certificates of Deposit insured by FDIC
2. U.S. Treasury & Federal Agency securities backed by the U.S. government
3. Principle protected Market-Linked CDs insured by FDIC
4. Mutual funds consisting of U.S. Government Securities, with an average credit rating of AAA

Restrictions:  Maximum individual bond or CD maturity:  5 years
No margin transactions, short selling, commodities or use of derivatives.
Uninsured investments (non FDIC or SIPC insured) are limited to 20% of
portfolio.

Risk tolerance:  Very Conservative

Target Rates of Returns:  90 day Treasury Bills