The Episcopal Diocese of Southwestern Virginia 100th Annual Convention

II.

PURPOSE

A.

The purpose of this endowment Policy Statement is to provide guidelines for the investment, management, and distribution of the Fund. The policies set forth herein incorporate the spending policy rules adopted in February, 1998, by resolution of the 79 th annualCouncil.

B.

III. SPENDING POLICY

A.

Fund spending for each fiscal year shall be 4-1/2 per cent of the Spending Base.

B.

Allocations and distribution of Fund spending shall be made quarterly.

C.

The spending policy set forth herein adopts a total-return concept that may result in the expenditure of amounts not traditionally classified as income.

IV.

INVESTMENT OBJECTIVES

The investment objectives for the Fund are to: A. Preserve and increase the real (inflation-adjusted) value of the Fund, and B. Provide a predictable and increasing distribution to carry out the charitable purposes for which the Fund is held.

V.

INVESTMENT GUIDELINES

A. ASSET ALLOCATIONS The asset allocation policy shall govern the selection and weighing of asset classes. The long-term strategic allocation and normal policy range for each asset class are shown below:

Asset Class

Long-term

Normal Policy

Strategic Allocation

Range

Cash Equivalents & short-term income

5%

0-30% 0-15%

Fixed income

25%

15-35%

Equities

70% 100%

60-80% 50-75%

38