East Midlands Synod Trust

Church
Investments

Association
Units Class A

The Synod Trust has for many
years offered churches the opportunity to invest sums "Unlikely to be
required within five years" in the Association Unit pooled fund, used
extensively by the Synod itself for its own funds. At the start of 2009 a unit
was worth £3.53 following a big fall from the previous year. An 18p (5%) tax
free dividend was paid in December. The value of a unit increased by the end of
the year to £3.87. These units are now to be called Association Units Class A.

This £3.7m pooled fund is
for medium to long term investors accepting medium risk. Normally the longer
money is invested, the lower the risk. Money is diversely invested mostly in
global equities, but also in UK
fixed interest and commercial property funds, exclusive to charities. A
substantial proportion of these funds are ethical funds.

Buying and selling units is
free. Investments can be repaid within three weeks, usually much sooner. Unit
valuations are produced quarterly.

A letter addressed to the
Trust Fund manager at the Synod office with a cheque asking for the money to be
placed in Association Units Class A, or B (see below) is all that is necessary.

Association
Units Class B

This is a new short to medium
term lower risk fund. In 2008 the COIF deposit accounts provided 5.3% interest.
To day it is 0.5%.  The Trust holds
deposit accounts to the value of £1.25m for Synod and church funds. Therefore
there will be an overall fall in income of 
around £50,000 this year and until deposit rates rise significantly. The
Trustees therefore decided to create this new fund. Synod fund holders have
already chosen to invest £300,000 in it now.

This Class B fund is
intended for churches with money "Unlikely to be required within 2-3
years". This pooled fund is now open to churches, but our second investment
phase is not planned until September 15th, and so units will not be
issued before then, and money is not needed earlier. One unit will be issued
for every pound invested. Class B units will be managed in the same way as
class A, with a dividend paid at the end of December each year.

By request, this money can be automatically be reinvested in more of
the same units.

The Class B income fund will
mostly be invested in fixed interest funds, but also in commercial property. It
is hoped that annual interest will be 5% pa. ie 5p for every pound invested but
only 1.25% for the final quarter this year.

Class A units will normally
perform better in times of inflation as investments are made in equities which
are likely keep pace with inflation, and perform better long term. Class B
units are intended to just retain their value and income but with a small risk
factor.

The decision to purchase
either class of unit is that of the church. 
There is a risk and units may fall in value. On the sale of units held,
the money returned may be smaller than the original investment. Class B units
are lower risk.                                                                   

The initial investment
minimum is £5,000 and for additions and withdrawals there is a £1,000 minimum
for both A and B units now.

Further information is
available from the Trust Fund manager, Malcolm Littlefair, tel; 0115 931 2225
or e-mail Malcolm [at] littlefair [dot] com.
The Synod office also has information.

22/2/10