Foundation Now Offering Short Term Investment Fund
The Dakotas Methodist Foundation is excited to introduce a new short-term investment opportunity in collaboration with Wespath Institutional Investments (WII). The Short-Term Investment Fund – I Series enables churches to generate income on their funds at levels typically exceeding those of conventional money market funds.
This short-term allocation mirrors WII's commitment to maintaining a balanced and secure investment portfolio. WII remains dedicated to safeguarding the stability and security of your investments, ensuring they adhere to both market opportunities and our ethical investment standards. As of December 31, 2023, this fund maintained a well-rounded portfolio with a focus on U.S. Treasuries, Corporate Bonds, and Asset-Backed Securities.
Advantages of the Short-Term Investment Fund – I Series
1. High liquidity: Funds can be accessed easily through our weekly withdrawal process.
2. No holds or penalties for redemption: Unlike Certificates of Deposit (CDs), there are no penalties for early withdrawal.
3. Benefit from interest rate increases: If the Federal Reserve raises interest rates, these are often passed onto the investors in these funds, potentially leading to higher yields.
4. Socially Responsible Investment Choices: The fund adheres to no investments in certain sectors like alcohol, tobacco, firearms, for-profit prisons, gambling, and adult entertainment. This ethical investment approach aligns with the social values of the United Methodist Church.
5. Comparison with 90-day T-Bill: Treasury bills are short-term U.S. debt securities that mature from four weeks to one year. T-bills are purchased at a discount from their face value, and when they mature, the U.S. government pays you the face value. They're considered low-risk since they are backed by the U.S. government. The yield you earn is the difference between the purchase price and what the government pays at maturity. For example, a 17-week T-bill auctioned in June 2023 had an annualized discount rate of 5.15%.
6. Comparison with Money Market Funds: Money market funds are another low-risk mutual fund investment in short-term debt securities. They offer returns based on short-term interest rates, making them suitable for investors looking to park cash. However, they typically have lower potential returns compared to other investment options and may have a higher minimum balance requirement.
It's important to remember that the suitability of these investments’ hinges on your individual financial objectives and risk tolerance. Treasury bills generally carry lower risk but also offer lower rewards compared to certain other investment options. Short-term investment funds may provide greater flexibility and potentially higher returns, but they may entail slightly higher risk, depending on the intended use of the invested funds.
If you're interested in learning more about this new fund or opening an account with us, please reach out to Diane Weller at diane.weller@dkmnmf.org for further details. New Account Applications can be accessed on the forms tab of our website.
