Gardnerville Water Company Investment Policy



            The purpose of this statement is intended to provide guidelines for the prudent investment of the Gardnerville Water Company’s cash balances, and outline the policies for maximizing the efficiency of the Gardnerville Water Company’s cash management system.  The ultimate goal is to enhance the economic status of the Gardnerville Water Company’s while protecting its assets.


            The objectives of the investments are the following:

A.     Safety.  Safety of principal is the foremost objective of the Gardnerville Water Company’s.  Each investment transaction shall seek to first ensure that capital losses are avoided, whether they are from securities defaults or erosion of market value.

B.     Liquidity.  An adequate percentage of the portfolio should be maintained in liquid short-term securities, which can be readily converted to cash as necessary to meet cash requirements.

C.     Yield.  Yield shall be considered only after the basic requirements of safety and liquidity have been met.

D.     Market-Average Rate of Return.  The investment portfolio shall be designated to attain a market-average rate of return throughout budgetary and economic cycles, taking into account the Gardnerville Water Company’s risk constraints, the cash flow characteristics of the portfolio, and state and local laws, ordinances or resolutions that restrict investments.

E.      Diversification.  The investment portfolio will be diversified to avoid incurring unreasonable and avoidable risks regarding specific security types.

F.      Public Trust.  All participants in the investment process shall act as custodians of the public trust.  The board of directors shall recognize that the investment portfolio is subject to public review and evaluation.  The overall program shall be designed and managed with a degree of professionalism that is worthy of the public trust.  In a diversified portfolio it must be recognized that occasional measured losses are inevitable, and must be considered within the context of the overall portfolio’s investment return, provided that adequate diversification has been implemented.


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