April's AFP Exchange Features Article "Updating Your Investment Policy" by
Ron Hart of
Citi. The piece tells
corporations and treasurers to review their cash investment guidelines to reflect new investment opportunities and to stay compliant. Hart says four areas of risk should be addressed:
credit quality, duration (maturity), diversification, and vendors. Objectives, quality, liquidity and compliance should also be discussed. Hart says, "
A conservative policy might include: T-Bills, agencies, BAs, CDs, A1 CP, 7- to 35-day Auction Rate Debt, VRDNs and Auction Rate Preferreds."