Ibbotson Associates provides the asset allocation guidelines consisting of U.S. Equity, International Equity, Fixed Income and Cash. The Sector allocations are intended to fulfill the U.S. Equity Portion of the aggregated portfolio. The relevant asset classes/sectors and benchmarks are displayed in the tables below. The portfolios span the risk spectrum of the efficient frontier from conservative to aggressive. In formulating diversified portfolios, Ibbotson employed a statistical technique know as optimization. The goal of optimization is to identify portfolios that maximize return for a given level of risk or minimize risk for a given level of return.
|Aggregate Asset Allocation|
|U.S. Equity Sector Allocation|
|Consumer Discretionary||S&P 500 Consumer Discretionary Sector|
|Consumer Staples||S&P 500 Consumer Staples Sector|
|Energy||S&P 500 Energy Sector|
|Financials||S&P 500 Financials Sector|
|Health Care||S&P 500 Healthcare Sector|
|Industrials||S&P 500 Industrials Sector|
|Materials||S&P 500 Materials Sector|
|Real Estate||S&P 500 Real Estate Sector|
|Technology||S&P 500 Information Technology Sector|
|Utilities||S&P 500 Utilities Sector|
|International Stocks||MSCI EAFT Trust|
|Domestic Bonds||Barclays Capital Bond Index|
|Cash Equivalents||Citi group U.S. Domestic 3 Month T- Bil|
Asset allocation cannot assure a profit or protect against a loss.
*Ibbotson Associates also uses MSCI World Index, Ibbotson Associates long-Term U.S. Government Bond Series, Several CRSP Deciles and CFI (Coleman, Fisher and Ibbotson) Synthetic Bonds to aid in determining the inputs.
© Ibbotson Associates, Inc.