26BUDGET(FULL-LINKED) - Flipbook - Page 271
required for repurchase agreements.
3.
4.11
4.12
DIVERSIFICATION
1.
It is the policy of the City of Plymouth to diversify its investment portfolio. The
diversification objective is to reduce overall portfolio risks while attaining average
market rate of return.
2.
Assets held in the common cash fund and other investments will be diversified to
eliminate the risk of loss resulting from over-concentration of assets in a specific
maturity, individual financial institution or a specific class of securities.
3.
Diversification strategies will be determined and revised by the investment officer
as needed.
4.
Investment maturities for operating funds will be scheduled to coincide with
projected cash flow needs, taking into account large routine expenditures (i.e. debt
service) as well as considering sizable blocks of anticipated revenue (i.e. property
taxes and state revenue sharing payments).
MAXIMUM MATURITIES
1.
To the extent possible, the investment officer will attempt to match investments with
anticipated cash flow requirements. Unless matched to a specific cash flow
requirement, the investment office will not directly invest in securities maturing more
than five years from the date of purchase.
2.
4.13
Securities may be held by a third-party custodian designated by the Finance
Director and evidenced by safekeeping receipts as determined by the Finance
Director.
Reserve Funds may be invested in securities exceeding two years if the maturity of
such investments is made to coincide as nearly as practicable with the expecteduse of
the funds.
PERFORMANCE AND REPORTING
1.
The investment officer shall submit an annual investment report that provides the
principal and type of investment by fund, annualized yield, ratio of cash to investments,
earnings for the year and a summary report of cash and investments maintained in each
financial institution.
2.
Performance of the portfolio shall be submitted to the City Commission and City
Manager in a quarterly report detailing the characteristics of the portfolio as well asits
performance for that period. Material deviations from projected investment strategies
shall be reported to the City Commission and City Manager.
3.
The City's investment strategy is relatively passive. Given this strategy, the
benchmark used by the investment officer to determine whether market yields are
being achieved will be the U.S. Treasury Bills rate.
INVPOL25
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