AB_MultiManager-RetTrust

4 Dynamic Allocation
With dynamic asset allocation, the Multi-Manager Retirement Trusts’
glide path can be monitored and adjusted in response to changing market
conditions. If there’s a big increase in market volatility or a sharp change
in the correlations of diversifying asset classes, adjusting the glide path
dynamically may help cushion the impact.
The portfolios focus primarily on moderating risk, not increasing returns.
This is reflected in their range of flexibility to adjust the overall equity
allocation. This range is tilted to the downside, which means there’s more
latitude to reduce equity exposure than to increase it.
Flexibility to Dynamically Adjust Glide Path. Focused on Reducing Risk.
Typical Range
100
80
60
Range of Equity and
Fixed Income Exposure
40
20
Target
0
20 25 30 35 40 45 50 55 60 65 70 75 80 85+
DAA: Range of Equity and Fixed Income Exposure
65 Five Year Old Vintage (Percent)
100
Equity Exposure*
Fixed Income Exposure
80
60
40
20
0
Large Cap
Small Cap/
Mid Cap
Defensive
Diversifiers
Real Estate/
Commodities
Real
Bond
Diversifiers
High
Income
Nominal
Bond
Short
Duration
*Equity exposure includes traditional equities, equity diversifiers, real estate and commodities
Source: AB
4
For plan sponsor, home office or financial advisor use only.
Not for inspection by, distribution or quotation to, the general public.