An investment policy statement (IPS) is a document that outlines an organization’s investment objectives, constraints, and guidelines. It is an essential tool for any charity that wants to manage its investments effectively. An IPS helps ensure that investment decisions are made in a consistent and prudent manner, and that they are aligned with the organization’s overall mission and goals.
There are many different ways to create an IPS. Some organizations choose to develop their own unique IPS, while others may use a template or sample IPS as a starting point. There are several advantages of using a template or sample IPS. Templates can save time and effort, and they can help ensure that the IPS is comprehensive and well-organized. They can also provide valuable guidance on the content and structure of the IPS.
Key Components of an Investment Policy Statement Template Charity
The following are some of the key components of an IPS template charity:
- Investment objectives: The investment objectives should clearly state what the charity hopes to achieve with its investments. These objectives may include things like generating income, growing capital, or preserving purchasing power.
- Investment constraints: The investment constraints outline any restrictions that the charity has on its investments. These constraints may include things like the types of investments that the charity is allowed to make, the amount of risk that the charity is willing to take, and the liquidity requirements of the charity.
- Investment guidelines: The investment guidelines provide specific instructions on how the charity will invest its assets. These guidelines may include things like the asset allocation of the portfolio, the investment strategies that will be used, and the risk management techniques that will be employed.
- Performance measurement: The performance measurement section of the IPS outlines how the charity will measure the performance of its investments. This may include things like the benchmarks that will be used, the frequency of performance reviews, and the actions that will be taken if the performance of the investments does not meet expectations.
How to Use an Investment Policy Statement Template Charity
If you are considering using an IPS template charity, there are a few things you should keep in mind:
- Make sure the template is a good fit for your organization. There are many different types of IPS templates available, so it is important to choose one that is tailored to the needs of your charity.
- Customize the template to meet your specific needs. Once you have chosen a template, you should customize it to reflect the unique circumstances of your charity. This may involve making changes to the investment objectives, constraints, and guidelines.
- Review the template regularly. The IPS should be reviewed regularly to ensure that it is still aligned with the organization’s mission and goals. Changes to the IPS may be necessary if the organization’s circumstances change.
Conclusion
An IPS is an essential tool for any charity that wants to manage its investments effectively. An IPS helps ensure that investment decisions are made in a consistent and prudent manner, and that they are aligned with the organization’s overall mission and goals. If you are considering using an IPS template charity, there are a few things you should keep in mind. Make sure the template is a good fit for your organization, customize the template to meet your specific needs, and review the template regularly.
By following these tips, you can ensure that your IPS is an effective tool that helps you achieve your investment goals.
