Diocesan Common Trust

The Diocesan Common Trust (DCT) was established in 1956 as a pooled investment fund to provide regular income while maintaining investment value versus inflation. It is especially useful for those without investment expertise. Any diocesan congregation or affiliated entity may participate. Individuals may not invest, but are encouraged to contribute to a fund held by a congregation or entity.

Performance

2019 DCT Performance: 19.03% net of fees.

Common Trust
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Oversight

The Trustees of the Episcopal Diocese of Fond du Lac oversee the investment strategy working with professional Investment Managers. They serve in a fiduciary capacity.

What THE DCT Does

Pooling assets allows for more effective and efficient investing. Benefits from economies of scale, discounted administrative fees and increased ‘purchasing power’ from access to the institutional share class level resulting in reduced expense and improved performance versus solo entity investing.

INVESTMENT STRATEGY

Assets under management are pooled for investment but accounted for on a segregated fund basis (similar to a mutual fund). Investment strategy is reviewed regularly and adjusted for an optimal mix of equities, bonds and alternative assets to meet the long-term goal of the DCT: providing income and maintaining investment value versus inflation. A long-term horizon accommodates fluctuating market conditions.

SRI/ESG Investing

In the 4th quarter of 2019, the Trustees of the Diocese incorporated a directed Socially Responsible Investing (“SRI”) and Environmental, Social, and Governance (“ESG”) investing criteria for up to 10% of assets. This decision was made recognizing the responsibilities to generate positive returns on assets and, as a church investor, to use these funds to positively impact actions and values consistent with our Christian mission were also recognized. The market of SRI/ESG investing has grown and stabilized over the past decade and the Trustees are convinced that intentionally placing a portion of funds into vehicles that meet SRI/EQG criteria are consistent with the mission of the Church and will generate returns to sustain meet our investment policy goal. The Trustees will examine the impact of this strategy after a year of experience.

Quarterly Distributions

Participants may determine to take distributions on a quarterly basis. The amount of the distribution is determined on an annual basis by the participant during the 4th quarter, but limited to no more than five percent of market value. If the participant elects to have no distribution, assets remain in the account and continue to grow. The distribution is made in the first month of each quarter.

Contributions & Withdrawals

Participants may contribute to or withdraw from their account(s) at any time. Contributions must be made by submitting information found on the contribution document. Withdrawals must be requested by submitting the withdrawal form with required documentation. Processing takes 3-5 business days.

Preformance

Over six decades, DCT performance (net of fees) has been able to exceed the rate of inflation while providing regular income to its participants. Past performance does not guarantee future results and assets in the fund are subject to risk and may lose value. The performance for the first three quarters of 2019 was 13.36% net of fees. Participants may request a detailed performance report by contacting the Diocesan Office.

Administration & Fees

The Trustees and Diocesan Office receive no fees for oversight or administration. Professional investment management fees of Graystone Consulting, a unit of Morgan Stanley Wealth Management, are currently 0.47% per year.

Fixed Distribution Election

Request Distribution
Directive Form

Determining Distribution: Participants may determine an annual fixed amount of distribution from each of their DCT accounts for the upcoming year. This may be any amount from no distribution up to 5% of the market value of a DCT account at the end of the 3rd quarter of the current year. The annual fixed amount is to be communicated to the Diocesan Office by the end of December. If no communication is received, the Diocesan Office will not generate distributions.

Making Distributions: The Diocesan Office will administer distributions with the Investment Advisor. A distribution of ¼ of the annual fixed amount will be made into the designated bank accounts of participants by the 15th of the first month of each quarter (so January, April, July, October). The Diocesan Office will notify participants when distributions have been made.