The funds that make up the Milford Foundation (the Foundation) portfolio are managed under the guidance of Milford Asset Management (Milford), so as to access the depth of investment expertise readily available to the Foundation’s Trustees. The Trustees value the opportunity to work with Milford and the growth that will accrue to the portfolios over time will be to the benefit of all those who receive grants.
The Foundation’s investments are divided into two portfolios – Capital and Grants – and early discussions with Milford around these portfolios indicated that the Capital portfolio would be invested via a Balanced Growth Portfolio strategy while the Grants portfolio would be held in a Cash/Cash equivalents portfolio. The rationale for this decision was that the Capital Portfolio would be the long-term funding base of the Foundation’s investments, it would take a long-term view and it could tolerate a higher level of risk over short timeframes in favour of gaining improved longer term returns. By contrast, the Cash
Portfolio would comprise cash and cash equivalents where the funds were readily available for granting by the Trustees as needed.
The Foundation’s Balanced Growth Portfolio was established in late March 2021 and has approximately 75% invested in growth assets (ie predominantly shares in both on and offshore markets) and has returned 11.6% from inception through to the end of October 2021. Locally the portfolio has significant positions in companies such as Fisher & Paykel Healthcare, Mainfreight and Contact Energy, while offshore holdings include names such as Microsoft, Amazon and Mastercard. Importantly, the portfolio
is very well diversified and managed across a wide range of markets and securities.
The Cash Fund holds a range of debt securities issued by entities such as Westpac, ASB, Port of Tauranga, Spark and Mercury and it has returned 0.3% since February 2021. These funds are readily available for the Trustees to draw on to make grants to beneficiaries, both existing and new.
The Trustees value the opportunity to work with Milford and the growth that will accrue to the portfolios over time will be to the benefit of all those who receive donations.
Graeme Thomas – Trustee,
Milford Foundation
Before each Trustee meeting, Bryce Marsden, Mark Riggall, Portfolio Manager at Milford and myself meet to discuss the Balanced Growth Portfolio in particular and the outlook for the investment markets. Mark provides an overview of market conditions, valuations and risks, and relates this to the mix of assets held in the Foundation’s portfolio. At our most recent meeting with Mark, there was no recommended change in the allocation of the portfolio and generally Milford is comfortable that attractive investment opportunities remain in share markets around the world. While Covid presents a risk in terms of portfolio performance as do global business supply chains that are tightening, it seems that markets have allowed for these contingencies but good security selection remains paramount as usual.
Overall, the Trustees are happy that each of the portfolios is well positioned to meet the charitable needs of the Foundation. The emphasis is upon achieving a prudent mix between long term growth in the Foundation’s capital versus access to ready cashflow to meet short term needs whether these arise from Covid related pressures or other community demands where the Foundation can help those in need.
This article was originally featured in the Impact magazine, click here to view the magazine online.