Investing Pathways: Professional Portfolio Observer

Popular Investment Benchmarks (Data as of 3/31/2013)
Stocks	Standard Deviation	1 yr	5 yrs	10 yrs
Large-Cap Stocks	15.01%	13.8%	5.72%	8.42%
Mid-Cap Stocks	17.93%	17.18%	9.37%	11.95%
Small-Cap Stocks	19.67%	17.95%	9.63%	12.7%
International Stocks	19.85%	11.38%	-0.80%	9.45%
Emerging Markets Stocks	21.52%	1.32%	0.67%	16.56%
Fixed Income
Intermediate Bonds	3.69%	3.59%	5.08%	5.09%
Short-Term Bonds	0.96%	0.82%	2.06%	2.96%
Overall market
Vanguard Total Stock Market Index (VTSMX)	15.7%	14.28%	6.43%	9.31%

AAII Asset Allocation Models

What is your investor profile? Follow one of our recommended allocations and check back frequently for monthly return data.

Investor Profile	Standard Deviation	1 yr	5 yrs	10 yrs
Aggressive Investor Age 18-35 30+ Years Investment Horizon	14.7%	12.6%	5.4%	10.7%
Moderate Investor Age 35-55 20+ Years Investment Horizon	10.8%	10.8%	5.4%	9.1%
Conservative Investor Age 55+ 10+ Years Investment Horizon	7.0%	9.1%	5.5%	7.4%

Suggested Allocation Breakdowns

Aggressive

20% Large-Cap Stocks

20% Mid-Cap Stocks

20% Small-Cap Stocks

20% International Stocks

10% Emerging Markets Stocks

10% Intermediate Bonds

0% Short-Term Bonds

Moderate

20% Large-Cap Stocks

20% Mid-Cap Stocks

10% Small-Cap Stocks

15% International Stocks

5% Emerging Markets Stocks

30% Intermediate Bonds

0% Short-Term Bonds

Conservative

25% Large-Cap Stocks

10% Mid-Cap Stocks

10% Small-Cap Stocks

5% International Stocks

0% Emerging Markets Stocks

40% Intermediate Bonds

10% Short-Term Bonds

Aggressive Portfolio Return

YTD:	8.0%
1 yr:	12.6%
5 yrs:	5.4%
10 yrs:	10.7%

Moderate Portfolio Return

YTD:	6.7%
1 yr:	10.8%
5 yrs:	5.4%
10 yrs:	9.1%

Conservative Portfolio Return

YTD:	5.6%
1 yr:	9.1%
5 yrs:	5.5%
10 yrs:	7.4%

Broad Allocation Scenarios

Aggressive Investor

Allocations

Aggressive Portfolio Return

1 yr:	12.6%
5 yrs:	5.4%
10 yrs:	10.7%

Characteristics

Growth:	Substantial
Income:	Very Low
Risk:	Substantial Year-to-Year Volatility of Portfolio Value
10%	Average Annual Growth in Value
-30%	Bad Year

Time Horizon

Age:	often 18-35
30+Years:	Long Investment Horizon
For investors who are very risk tolerant

Transition:

80% Diversified Stock
20% Fixed Income

Investors, as they age, usually transition their portfolios toward less risky and less aggressive asset allocations.

Moderate Investor

Allocations

Moderate Portfolio Return

1 yr:	10.8%
5 yrs:	5.4%
10 yrs:	9.1%

Characteristics

Growth:	Moderate
Income:	Low
Risk:	Moderate Year-to-Year Volatility of Portfolio Value
8%	Average Annual Growth in Value
-20%	Bad Year

Time Horizon

Age:	often 35-55
20+Years:	Mid-Term Investment Horizon

For investors who can tolerate some risk

Transition:

60% Diversified Stock
40% Fixed Income

Investors, as they get closer to retirement, usually transition their portfolios toward lower risk and more conservative allocations.

Conservative Investor

Allocations

Conservative Portfolio Return

1 yr:	9.1%
5 yrs:	5.5%
10 yrs:	7.4%

Characteristics

Growth:	Low
Income:	Moderate
Risk:	Low Year-to-Year Volatility of Portfolio Value
6%	Average Annual Growth in Value
-15%	Bad Year

Time Horizon

Age:	often 55+
10+Years:	Short-Term Investment Horizon

For investors who are not risk tolerant

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