Investment Objectives Information
Total Return/Limited Volatility
The Trust's primary investment objective is to achieve the total return necessary to maintain "real value" of assets, with limited risk/volatility, over a long period of time so that the Trust may function in perpetuity without diminished capacity. Growth of the real value of assets, to a modest extent, is a secondary objective.
Strategic Asset Allocation
To achieve the long-term goal, the Trust has adopted an efficient strategic asset allocation that envisions a reasonably stable distribution of assets among asset classes or risk categories (buckets) as follows:
|Risk Bucket I (low) - Capital Preservation||15%||5% - 25%||5% - 9%
|Risk Bucket II (medium) - Equities/Value-Added Real Estate
||50%||35% - 65%||9% - 12%|
|Risk Bucket III (high) - Alternative Investments
||35%||20% - 50%||12% - 18%|
Deviations from target, within the range, will be permitted without action and generally are the result of transitioning in and out of asset classes and short-term performance variations. Deviations outside the range should result in adjustments in cash flow or other actions to move toward the target allocation within a reasonable period of time.
To control risk and minimize volatility, the Trust will diversify among risk buckets and within risk buckets to the extent deemed necessary to reduce risk/volatility to an acceptable level for the expected return. Investment managers are monitored to assure risk/volatility is within acceptable limits and consistent with expectations. Manager exposure will be controlled so as not to exceed 20% for any one manager.