Long Term Investment Pool and General Cash Float (GCF)

The Long Term Investment Pool (LTIP)

The Long Term Investment Pool (LTIP) is a financial structure for the investment of monies on behalf of the University.  The LTIP is a managed as a ‘balanced’ portfolio of financial assets to meet its risk and return objectives.  The unitholders of the LTIP include various areas of the University and include Endowment funds and the Superannuation Reserve Account which holds units so as to meet the financial obligations relating to the Commonwealth Superannuation Scheme. Unit holders buy and sell units at the latest market price.  Applications to buy or sell units in the LTIP need to be authorised by the appropriate delegate.

Only those funds with an investment horizon of greater than three years are placed in the LTIP.  Assets with a shorter-term investment horizon are managed in the General Cash Float (GCF), which is a cash or enhanced cash portfolio outside of the LTIP.

The LTIP has an investment return objective of CPI+3.5% per annum over rolling seven year periods while limiting the likelihood of a negative return occurring to one in five years.  The investment performance of the LTIP is independently verified on an annual basis by SuperRatings Pty Ltd.  The total portfolio returns are compared against the SuperRatings Pension Fund Crediting Rate Survey (Balanced Options).

Distributions from the LTIP are set at a rate that is considered to be sustainable and underpinned by income streams.  Distributions are paid quarterly and the distribution rate is currently set at 4.5% per annum.  Variations between the distribution paid and total returns from the LTIP are reflected in the market price of units.  Distributions to unitholders that are Endowment funds are often used in the payment of scholarships. Advice on how to become a donor and what donors can achieve through investment in the LTIP can be found at the ANU Endowments website.

External Investment Managers

The majority of the assets in the LTIP are invested through external investment managers.  External investment managers are selected based on their specialist skills as well as their ability to meet the specific requirements of the University including the ability to integrate ESG considerations into their investment process.  Before appointing managers, extensive research is undertaken across a range of factors as outlined in the Investment due diligence Policy.  In addition, regular, on-going due diligence evaluation is undertaken for all external investment managers after appointment.

The General Cash Float (GCF)

In addition to fulfilling the investment objectives of the Long Term Investment Pool, the Investment Office also manages the General Cash Float (GCF). The GCF is a portfolio of cash and fixed interest investments, used to manage the University's Treasury activities. Efficient Treasury management provides the University with a stable funding environment so it can pursue its strategic goals effectively. It also ensures the University can meet its financial obligations in full and on time. The Investment Office is also able to provide hedging advice to areas of the University involved in foreign currency transactions. Those looking for hedging advice should contact the Investment Office.

Contacts

Mary Fallon

Director, Investment Office

Email: mary.fallon@anu.edu.au

Phone: 02 6125 8753

Justin Chan

Investment Analyst, Portfolios

Email: justin.chan@anu.edu.au

Phone: 02 6125 8755