Finding a potential balance between risk and reward

Sources: © 2023 – Morningstar Direct, All Rights Reserved1, and Wells Fargo Investment Institute. Data from April 1, 2008 to March 31, 2023. Performance results for Moderate Growth and Income Liquid are calculated using blended index returns and is for illustrative purposes only. Moderate Growth & Income allocation is dynamic and changes as needed with adjustments to the strategic allocations. Index returns do not represent investment performance or the results of actual trading. Index returns reflect general market results, assume the reinvestment of dividends and other distributions, and do not reflect deduction for fees, expenses or taxes applicable to an actual investment. Unlike most asset class Indexes, HFR Index returns are net of all fees. Because the HFR Indexes are calculated based on information that is voluntarily provided actual returns may be lower than those reported. An index is unmanaged and not available for direct investment. Past performance is no guarantee of future results. Standard deviation is a measure of the volatility of returns. The higher the standard deviation, the greater volatility has been. See “Index Definitions and Asset Class Risk Disclosures” link above for composition of the Portfolios, risks and definitions of indexes.

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Diversification strategies do not guarantee investment returns or eliminate the risk of loss. Indexes represented: U.S. Investment Grade FI = Bloomberg U.S. Aggregate Bond Index. Hedge Funds = HFRI Fund Weighted Index. Emerging Market FI = JP Morgan EMBI Global Index. High Yield FI = Bloomberg U.S. Corporate HY Bond Index. U.S. Mid Cap Equities = Russell Midcap Index. U.S. Small Cap Equities = Russell 2000 Index. Developed Market Ex-U.S. FI = JP Morgan GBI Global Ex U.S. Index. U.S. Large Cap Equities = S&P 500 Index. Developed Market Ex-U.S. Equities = MSCI EAFE Index. Emerging Market Equities = MSCI Emerging Markets Index. Public Real Estate = FTSE EPRA/ NAREIT Developed REITs Index. Commodities = Bloomberg Commodity Index. FI = fixed income. DM = developed market. EM = emerging market.

Key Takeaways

  • We believe a diversified allocation can strike a good balance between risk and return.