Asset class: Asset Allocation

Asset Allocation: Categories, Focuses, and Niches

The fund is designed to combine assets from at least two of the following asset classes: equity, fixed income, commodities, and currency. Funds with two or more asset classes could instead appear in the Alternatives asset class if they meet the requirements below.

Category: The primary objective or strategy of funds under this category is diversifying investments across multiple asset classes. It's about allocating a portfolio's assets according to an individual's goals, risk tolerance, and investment horizon.

Focus provides more specific insight into the primary strategy or methodology the Asset Allocation fund employs:

Target date: These funds adjust their asset allocation over time, often with a specific retirement date in mind. As this date nears, the fund generally transitions towards more conservative investments.

Target risk: Multi-asset funds designed to align with a specific risk profile, ranging from aggressive to conservative.

Target outcome: Funds aiming for a particular investment outcome, such as consistent income or capital appreciation.

Niche delves deeper into the fund's strategy within its focus:

For target risk funds: Labels like Aggressive, Moderately aggressive, Moderate, Moderately conservative, and Conservative help identify the fund's risk alignment.

For target date funds: The niche specifies the particular year or timeline given in the fund's name or documents, indicating when a target, often retirement, is projected.

For target outcome funds: The niche clarifies if the main objective is income, capital growth, or a combination of both.