Investment information


Gifts to the Acorn Foundation become part of a permanent endowment, which means they will benefit our community forever.  We invest our donors’ gifts so they continue to grow over time and maximise the resources available to Acorn to address community needs.

Investment Objectives

For endowed funds, our primary investment objective is to preserve the original capital value of a gift and grow our assets as much as market conditions allow, so we can:

  • Invest in programs that address community needs now; and
  • Ensure there will be resources available to address community needs in the future.

Donations to the Acorn Foundation are pooled and invested in perpetuity but each donor fund is tracked and recorded individually. The investment returns are used to make distributions to local community organisations each year, in accordance with each donors' wishes.

The investment objectives of the Fund are:

  • To preserve the nominal value of the Fund, with a preference for maintaining the real value over time;
  • To generate sufficient return within the Fund on a rolling annual basis to:
    •    Cover the administration expenses of the Fund, including the Investment Manager;
    •    Contribute to the operating expenses of the Foundation; and
    •    Provide sufficient long term returns to enable the Foundation’s charitable distributions.
  • The expected long-run gross return objective of the Fund, based on the asset allocation is 5.2%.  Return volatility means this will not be achieved every year, but this is the target on a rolling 5-year basis, measured on weighted average FUM over that period.

Fund Management

The Fund is currently managed by Craigs Investment Partners, under the authority of the Acorn Foundation Investment Advisory Committee. This means all investment decisions must be approved by the Investment Advisory Committee, who are appointed by Acorn's Trustees. Investment decisions made by the Investment Advisory Committee ensure adherence to Acorn's Investment Policy.

Asset Allocation

Asset allocation is undertaken in a way that reflects the Foundation's investment objectives and corresponding risk profile:

Asset Allocation table.PNG   

The primary role of the Fixed Income and cash allocation is to provide regular income and the preservation of capital. The primary role of the New Zealand, Australian and global equity holdings is to provide sustainable income, growth in income over time, or capital growth. The primary role of the Property allocation is to provide sustainable income and growth in income over time. The primary role of alternative assets is to provide investment returns that are less correlated to listed financial market returns. They provide important diversification of systematic risk, as well as return contribution.

Responsible Investment

The Acorn Foundation Fund will be managed with a Socially Responsible Investment framework which reflects the Foundation’s Vision.  The fund will endeavour to exclude investments in alcohol, armaments, tobacco, pornography, and gambling. 

View the Acorn Foundation's Responsible Investment Policy here.

Acorn Investment Beliefs, as updated in 2021:

  1. Diversification within and across asset classes is a critical risk management mechanism. 
  2. The strategic asset allocation (or asset mix) decision is the most important factor in determining investment return and risk in the long-term. 
  3. Whilst less predictable in the short to medium term, asset classes tend to deliver predicable returns over the long-term. 
  4. Acorn’s investment horizon is long-term in nature, and therefore it can ride out volatility that may impact short-term investment performance.
  5. Regular portfolio rebalancing helps to maintain an appropriate level of risk exposure. 
  6. Tactical asset allocation (or market timing) cannot be expected to consistently add value in the long-term. 
  7. Quality assets are a crucial element of risk control in a portfolio.  Risk of permanent loss of capital should be minimised to the extent possible.
  8. Where active management is determined not to add value, such as in markets deemed to be highly efficient, passive management is the default choice. 
  9. Costs (administration, investment management fees, custodial fees, etc.) have a significant impact on long-term results and need to be carefully monitored and controlled to ensure value. 
  10. Investments should consider the contribution or impact to environmental, social and governance factors.

Performance

Past ten year annual returns:

Investment Table 2020.PNG

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