The Right Portfolio for Your Personal Risk Tolerance
Summit’s Risk Tolerance Allocations are total-portfolio solutions that allow investors to invest in portfolios that consider the amount of risk being taken to achieve financial returns. This family of strategies features five risk profiles—very aggressive, aggressive, moderate, conservative and very conservative. These allocations are constructed based on incremental levels of potential risk relative to the risk of an all-stock index.
An All-Weather Approach
The goal of our all-weather approach to Risk Tolerance Allocations is always the same: a portfolio worth more in real dollars this year than last year. We structure the investment so that under most market conditions, part of the portfolio is poised for growth. The right mix of stocks, bonds, treasuries and other assets provides the opportunity to generate a positive return without seriously stifling potential growth.
Each Risk Tolerance Allocation is made up of composite portfolio strategies representing three major asset classes: stocks, bonds and alternative investments. The asset class indices are weighted differently within each relative risk index to achieve the targeted risk level. The weightings are rebalanced annually to maintain these levels. The alternative investment strategy is uncorrelated to both bonds and stocks and is employed to achieve positive returns in periods of market volatility that can provide a level of downside protection for the allocation.