EMS FAQs for Current Custom Accounts

What funds does SSgA use in its Custom Accounts?
SSgA normally uses Common Trust Funds (CTFs) to build a diversified portfolio in multiple asset classes for Custom Accounts. A Common Trust Fund is a collective investment vehicle used by banks to commingle funds for the benefit of fiduciary customers. It reduces administrative and operating costs of investments. Unlike mutual funds, there are no embedded management fees in CTFs.

What is tactical asset allocation and how does SSgA use it in our portfolio?
Asset allocation is the primary driver in portfolio returns. To achieve optimum results, SSgA actively manages the asset allocation of its Custom Accounts within the parameters set by your investment policy statement. Our portfolio manager will overweight or underweight the various assets classes vis-à-vis the strategic target, within set ranges, to avoid dangers or take advantage of opportunities.

To guide their decisions, SSgA uses a Tactical Asset Allocation Model that combines the power of quantitative analysis – enabled by processing vast amounts of objective information – with the fundamental perspectives, opinions and experience of asset class and portfolio managers. A team of investment managers from around the world meets each month to analyze data and assess market trends.

Systems measure factors such as valuation, momentum, sentiment and other macro characteristics within various asset classes, like equities, bonds, REITS, real assets, and commodities providing predicted returns on more than 100 asset classes each day. Asset class teams then challenge the model’s results, adding an overlay of fundamental analysis.

A proprietary optimizer program determines the best asset allocation for the SSgA portfolios considering their risk tolerance, objectives, and constraints. It then produces a set of suggested trades which your portfolio manager takes into consideration when making adjustments to your portfolio.

What is SSgA’s investment philosophy?
Diversify broadly; use core strategies (avoid both growth and value bias); take risks in the less efficient markets where SSgA believes it can outperform the indexes; use indexed funds in the more efficient markets.

What is SSgA’s investment style?
SSgA believes that its use of Common Trust Funds, bundled solution (investment management/custody/administration combined), and style of active asset allocation and rebalancing gain the best return for its clients at the lowest cost. Because of its size, its global presence, and its ability to trade internally, trading costs are kept to a minimum.

Cost savings translate directly into performance. Minimizing investment management fees and transaction costs (commissions, bid/offer spreads, and market impact) have a positive impact on performance.

How often is our account rebalanced?
Any time that money is added to an account, or withdrawn, the account is rebalanced to its strategic target (with tactical overlays). If an account moves out of balance by 3% or more following any quarter, it is automatically rebalanced. This provides a discipline of buying low and selling high.

What reports can we expect?
Statements are distributed each month by regular mail to the primary and second contacts on the account, and by e-mail to your distribution list.

Each quarter performance reports are sent by e-mail to your distribution list along with SSgA’s long-range asset class forecast.

Can we hold regular conference calls with our portfolio manager at SSgA?
Yes. We encourage all Custom Accounts to schedule regular conference calls with their portfolio manager at SSgA. Contact Ken Quigley at ECF to schedule your call.

During the call your SSgA investment manager will review performance of your portfolio for the past quarter, performance of the underlying funds in the portfolio, asset allocation, and market trends.

Can we access our account on-line?
You can request current information and reports as needed by contacting Ken Quigley at ECF, but there is no direct on-line access.

How can we add funds to our account?
Funds can be added to your account at any time. Send a check or wire the funds to SSgA noting your account number. Custom Account have daily valuation so that the funds you transfer are normally invested in your portfolio within a day of arrival.

Send checks to:
Scott Regan
Charitable Asset Management
State Street Financial Center
One Lincoln Street, 24th floor
Boston, MA 02111-2900
Tel. (617) 664-3182

Wires to:
State Street Bank and Trust Company, Boston, MA
ABA Routing #: 011-000-028
To a/c #5673-032-8 – Reconciliation Clearance Account
For a/c #52-00000 (Name, City and State of Account)

How can we withdraw funds?
Send an e-mail to Ken Quigley requesting the amount you want to withdraw. Funds can be withdrawn at any time without penalty. If there is sufficient cash in the account, an ACH wire will be sent the same day. If SSgA needs to sell assets to raise cash it will take approximately three days for the sale to take place and the proceeds to enter your account. It usually takes three to four additional days for an ACH wire to transfer to your bank account.

For accounts that have not opened an ACH account, a check will be sent.

Payouts can be automatic dollar-specific transfers – monthly, quarterly annually – or periodic as requested.

What other benefits do we receive by being part of a community of Episcopal investors?
ECF provides service in three basic areas:

Structure & Endowment Management – We provide sample endowment policies and work with you to adapt these policies to your particular circumstances. We also provide counsel and support on various issues of endowment management – from understanding the nature of true and quasi endowments, to reviewing purposes, to applying spending rules, to developing investment policy statements and more.

Investment As described above.

Growth – ECF supports your efforts in planned giving by helping you create awareness of legacy giving and develop the knowledge to respond to potential donors. A comprehensive package of planned giving resources called Planned Giving on Demand is provided free-of-charge to all ECF Accounts.

In addition, ECF can facilitate charitable gift annuities, charitable remainder trusts, and pooled income funds for your donors who want to designate these gifts for the benefit of your organization. ECF guarantees these life-income gifts with its own endowment and provides the administrative support and reports required.

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