07.25.19 DBF Investment Policy_final.pdf - The Diversified Bond Fund (DBF) has been created by the Idaho State Treasurer's Office as an alternative investment to the short term investment funds such as the Local Government Investment Pool (LGIP) and IDLE, for those state agencies and public agencies who are able to assume less liquidity and more price volatility for the potential of greater returns over the long run.

The investment objective for the DBF is to provide a reasonable level of current income which, when combined with potential capital appreciation as measured on a long-term basis, will accommodate growth satisfying all potential distributions. Since the DBF is by nature invested with a relatively longer weighted average maturity and since proportionate ownership in the fund is based on market value, participants can expect the value of their investment in the fund to fluctuate over time. Participating agencies should therefore only invest monies that they consider longer-term in nature (ex. 3.5 years or longer).

In general, the investment guidelines require that funds be invested in high quality securities in a manner that provides a high level of total return at a reasonable level of risk measured over a long period. The investment manager will achieve the investment objectives through active management of the portfolio to meet or exceed the Barclay's Capital Intermediate A+ Aggregate Fixed Income Index.

* Securities in the DBF are shared positions valued at current market values. Due to interest rate changes and market movements, it is possible to lose money by investing in the DBF.