What Is a Charitable Trust Fund?

Charitable fund trusts are financial trust institutions that accept government, social groups, units, or personal trusts, use their funds, sponsorships, and donations for social charities, social welfare and other social welfare undertakings, and transfer the trust funds as agreed Business for designated public welfare projects or beneficiaries and groups. The income or funds of such trusts must be truly used for public welfare undertakings and subject to the supervision of the public or the client. Such trust funds have a long life span, and generally only use the trust income portion during their lifetime, and rarely use the principal portion. In order to support the development of public welfare undertakings, financial trust institutions can pay trust benefits when opening such trusts, and appropriately reduce trust handling fees. ^[1]

Charity Fund Trust

Right!

Charitable fund trusts are financial trust institutions that accept government, social groups, units, or personal trusts, use their funds, sponsorships, and donations for social charities, social welfare and other social welfare undertakings, and transfer the trust funds as agreed Business for designated public welfare projects or beneficiaries and groups. The income or funds of such trusts must be truly used for public welfare undertakings and subject to the supervision of the public or the client. Such trust funds have a long life span, and generally only use the trust income portion during their lifetime, and rarely use the principal portion. In order to support the development of public welfare undertakings, financial trust institutions can pay trust benefits when opening such trusts, and appropriately reduce trust handling fees. ^[1]

Compared with the current fund management model, trust-managed social welfare funds will have the following obvious benefits: ^[2]

1. The purpose of the trust is for the public good; ^[2]

There are two ways to set up a public welfare trust. One is to set up a trust by one or more specific clients to donate property to a trust company. The trust company manages, uses, and disposes according to the public welfare purpose and beneficiary scope specified by the client. Trust property and distribute trust benefits to beneficiaries; the other is to raise funds from the public through a fundraising method based on a certain public interest purpose for the benefit of the public or a certain range of public Funds are used for investment, and all investment proceeds are used for public welfare purposes that are publicly disclosed to the society at the time of fundraising.

Both methods can be open, that is, donations are open for the duration of the trust. For the public trust established by a specific client, the object of the open donation may be the original client itself, and with the consent of the original client, the donation may also be open to other publics; for the public trust established by the trust company to raise funds, it shall be open to the community Public donations are open.

The establishment of public trusts initiated by specific clients shall be carried out in accordance with the provisions of the Trust Law, the Administrative Measures for Trust Companies and the Notice. In particular, no matter whether there are one or more clients, it must not be limited to the "Administrative Measures for the Trust Company Collective Fund Trust Scheme"; the establishment of a charitable trust raised by a trust company can be based on The characteristics of the trust are based on the relevant provisions of the Securities Investment Fund Law and the Measures for the Administration of Securities Investment Fund Sales. For example: the selection of fundraising agencies; the preparation and release of fundraising and promotional materials; the production of "recruitment instructions" and "trust contracts"; the registration of open fundraising and so on.

Bank of China's non-profit fund trust business mainly includes provident fund trusts and social insurance fund trusts. ^[2]

The "Notice" stipulates that "the public trust trust property and its proceeds managed by a trust company can only be invested in treasury bonds, policy financial bonds and other low-risk financial products permitted by the China Banking Regulatory Commission with good liquidity and strong liquidity." Trust companies Investment with public trust funds can be invested independently and should be allowed to entrust investment.

The charitable fund trust

From the stage of creation to the latest announcement of performance, only 6 of the 32 trust and investment funds that can be counted outperformed the market. Among them, the Ping An Card, which was only established on June 15, 2008, has grown in the second phase, and the results on July 13 when the results were announced were still negative. Of the 6 trust investment funds that outperformed the broad market, only one outperformed the market by 20 percentage pointsShenzhen Investment? Chizhixin (China), the product was created on February 20, 2004, as of 2008 On July 31, the cumulative net value increased by 180.40%, and the overall market growth rate was 159.68%, which was 20.72 percentage points higher. Of the 26 trust investment fund products that underperformed the broader market, only nine were close to the broader market, and the rest were lower than the broad market by more than 10 percentage points.

Among the trust investment funds that announced the latest results, only two of the 17 trust investment funds that could separately calculate the July performance outperformed the market, accounting for 11.76%. In terms of public offering funds, in July 2008, 46 of the 259 partial equity funds had a net growth rate that exceeded the market, accounting for 17.76%, which was higher than the 11.76% of trust investment funds. The average growth rate of partial equity funds in July 2008 was 13.33%. Only 4 of the trust investment funds reached this growth rate in the same period. In addition to the 2 that outperformed the broader market, the other 2 were Ping An? Oriental Harbor Marathon, Ping An? Xiaoyang China Opportunity Phase II, the net growth rate in July was 14.06% and 14.12%.

It is worth mentioning that the Shenlin Forest Park, which was established on February 28, 2008 by the Shenzhen International Investment and Investment Park, had a net worth growth rate of only 27.74% as of July 20, 2008, while the broader market rose by 40.88% during the same period. ^[2]