Target-Risk Funds

First American Bank offers a list of mutual fund choices in every asset class and investment style for 401(k) plan participants.  Many plan participants often find it difficult to choose between fund offerings, and how to put those choices together in an asset allocation that fits their investment objectives and risk tolerances.  To solve this problem, we created five Target-Risk Funds:

Conservative Income Model

  • Cash               0-10%
  • Fixed Income   90-100%
  • Equity              0%

This objective focuses on current income and wealth preservation.  It is generally intended for investors with significant income needs, and/or no tolerance for fluctuations of the equity markets.

Conservative Growth with Income Model

  • Cash               0-10%
  • Fixed Income   65-85%
  • Equity              15-35%

This objective focuses primarily on current income and wealth preservation, with a secondary goal of modest capital appreciation.  This objective is generally intended for investors with significant income needs, and/or a lower tolerance for fluctuations of the equity markets.

Conservative Growth Model

  • Cash               0-10%
  • Fixed Income   50-75%
  • Equity              25-50%

This objective seeks both current income and capital appreciation, with an emphasis on income producing securities. This objective is generally suitable for investors with a long-term investment horizon, a desire to participate modestly in the equity markets' potential for growth of wealth, and a reasonable tolerance for the inevitable fluctuations of the various equity markets.

Balanced Growth Model

  • Cash               0-10%
  • Fixed Income   35-55%
  • Equity              45-65%

This objective seeks both capital appreciation and current income, with an emphasis on capital appreciation. This objective is suitable for investors with a desire to participate in the equity markets but who also want fixed income exposure to temper the volatility of the overall portfolio.  The investor is generally willing to accept the expected market fluctuations in return for potentially greater growth of principal.

Aggressive Growth Model

  • Cash               0-10%
  • Fixed Income   15-40%
  • Equity              60-85%

This objective focuses on capital appreciation, with minimal income expectations. This objective is suitable for investors who want active participation in multiple equity markets, with a modest allocation to the fixed income markets for defensive purposes. The portfolio may experience significant market fluctuation at times, and the appropriate investor is willing to accept the increased risk.

 

Similar to the Asset Allocation Model Portfolios, these funds are combinations of mutual funds.

  • Overall allocation to stocks and bonds are within ranges for each fund, and our investment professionals will move the allocation within those ranges depending on their outlook for the markets.
  • Distribution among large cap, mid cap, small cap and international equities varies from fund to fund.
  • Portfolios are automatically rebalanced periodically to bring holdings in line with the specified allocation for each objective.

For information on our mutual fund selection and monitoring process, please see Mutual Funds.

For information on products and services we offer to 401(k) plans, please see Employee Benefit Plan Services.

 

 

 

Not FDIC Insured Not Bank Guaranteed May Lose Value
Not Guaranteed by any Government Agency Not a Bank Deposit

Quarterly Investment PDF

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