This fund offers investors exposure to a flexible mix of stocks, bonds, and short-term reserves in a single investment. The fund may invest 100% in any one of the three asset classes. This “tactical” asset allocation process allows the advisor to change the allocation based on the relative outlook for each asset class. When the asset allocation of the fund changes, the risk profile of the fund also changes. Investors who can tolerate the volatility of the stock and bond markets may wish to consider this fund as a complement to an already diversified portfolio.
If you work at a company providing a 401(k) plan, it behooves you to understand your fund options. Most plans offer three types of investment alternatives: target-date mutual funds, actively managed mutual funds and index funds.
