Because History Matters Endowment Campaign:
Fund Investment & Spending Policy
The Fall River Historical Society Endowment Fund shall serve three primary objectives: the generation of current income (dividend and interest), long-term capital appreciation, and a funding source to be available for the organization’s needs. It is FRHS’s intention that investment returns equal or exceed the rate of spending plus inflation. For this fund to be sustainable, a three-year Moving Average Method will be utilized. This method will smooth the overall spending rate and reduce the impact on principal by a single year’s increase or decrease in value, helping to preserve the endowment value and sustain future spending.
The spending rate will be capped at 4.5% of the rolling three-year average market value. It will be calculated by taking the three previous years ending balance less beginning balance, including income generated and then averaged.
Most of the portfolio will be invested in high-quality large capitalization stocks and bonds, while also holding mutual and exchange traded funds to further enhance diversification and returns.
Additional operating funds provided by endowment fund earnings will be used to ensure financial stability and expand our day-to-day operations. This broadening of our funding base will enhance our ability to respond to current and future needs, will enable us to provide additional services to the community, and will provide a funding source for future emergency situations.
