Morningstar 2011/2012 - (Page 49)

+ 1 866 374 – 8800 global.morningstar.com 49 Investors are increasingly turning to alternative investments, which aim to provide lower correlation to traditional markets, for additional sources of return and an opportunity to reduce their portfolio risk. We construct portfolios composed of a diverse group of alternative strategies and non-traditional asset classes. These portfolios are accessible to the average investor and have lower fees, greater transparency, and fewer liquidity constraints than conventional hedge funds. Our mutual fund fiduciary service helps boards of directors fulfill their Rule 15 (c) regulatory duties by supplying fully customizable reports that present fund expenses, performance, and relevant peer group comparisons. We take a consultative approach at every stage, from report design through the board meeting, to meet specific needs and explain the significance of our findings. Morningstar Investment Management research professionals share their insights at the annual Morningstar Ibbotson Conference. The event unites academic and industry experts to discuss the latest in financial theory and practice. The 2012 Morningstar Ibbotson Conference will take place February 23–24 in Hollywood, Florida. Our experts will also introduce their latest breakthroughs for institutional investors at the Morningstar Investment Conference Europe, March 15–16 in Vienna, Austria. Learn more about our services global.morningstar.com/InvestmentAdvisory Examples of Customized Investment Solutions for Clients Asset Management Solution Insurance Company Solution Controlled Volatility Portfolio Broker/Dealer Solution Wealth Management Program 9 Features and Beneﬁts The Controlled Volatility Portfolio can be used as a core holding because of its diversiﬁed nature. It may be suitable for general investors who want to maintain some level of exposure to equities for the potential of growth but in a more cautious way. Diversiﬁed Portfolio 3 The Portfolio combines high quality investments from a wide range of investment management specialists for each asset category. The investments for the portfolio are put through due diligence in order to meet the high standards for the Portfolio. They are evaluated based on performance, expenses, and a wide range of additional criteria. Controlled Risk Techniques 3 The special risk management technique applied to the Portfolio aims to capture the upside of the market and limit the downside impact by becoming more conservative (reducing equity funds) during times of market volatility and less conservative (increasing equity funds) when the market is less volatile. Sophisticated Portfolio Management 3 The Portfolio is actively managed by a leading independent portfolio construction advisor, Morningstar Investment Management, using quantitative and qualitative analytical methods to monitor daily, analyze and select investments. Strategic Portfolios 9 Tax-Sensitive Portfolios 9 Tax-Sensitive Portfolios Rolling One-Year Volatility for 60/40 Portfolio Decrease Equity % Long-term Risk Short-term Risk 18 % 16 14 12 10 Standard Deviation 5 Tactical Portfolios Increase Equity % 8 6 4 2 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 FOR ILLUSTRATIVE PURPOSES ONLY. Source: Morningstar, Inc. proprietary data. Volatility data represents the standard deviation of annualized returns from December 1999 to December 2009. 60/40 Portfolio: 24% MSCI Europe, 36% MSCI AC World Ex-Europe, 40% BarCap Euro Aggregate. Data shown is based on historical index volatility and not the actual volatility of any portfolio. Need 3 3 3 Need 3 3 3 Need 3 3 3 Simplify asset allocation decisions for investors Create comprehensive story for wholesaler team Leverage independent, third-party expertise Solution Satisfy investors seeking protection against extreme market ﬂuctuations Offer a strategy that’s distinct from a traditional core portfolio Craft simple and compelling investment communications for advisors Solution Provide investors with ongoing wealth management Give advisors a differentiated and robust set of Tax-Sensitive 9 Target Risk portfolios to offer9 Portfolios their clients Portfolios Educate advisors about the differences between each portfolio program Solution Wealth Management Program 3 3 3 Created funds of funds with mutual funds and variable annuities Provided subadvisory support, including portfolio construction and execution Assisted with marketing initiatives, including wholesaler training, road shows, and co-branded marketing materials 3 3 3 5 Tactical Portfolios Developed a proprietary risk-management technique Designed a portfolio that maintains its risk target despite changes in market volatility Produced sales tools with easy-to-understand descriptions and graphics 3 3 3 Collaborated with the client to build its Wealth Management Program Created 23 diverse portfolio choices, including strategic, tactical, and tax sensitive Delivered marketing and sales support to highlight beneﬁts and provide updates on all portfolios Morningstar Investment Management is a division of Morningstar comprising its investment advisory subsidiaries. The investment advisory services described are offered by Morningstar Associates, LLC, Morningstar Investment Services, Inc., and/or Ibbotson Associates, Inc., all registered investment advisors and wholly owned subsidiaries of Morningstar, Inc. http://global.morningstar.com http://global.morningstar.com/InvestmentAdvisory

Table of Contents for the Digital Edition of Morningstar 2011/2012

Morningstar 2011/2012
Table of Contents
Commonwealth Financial Network
The Hartford
ING
Transamerica
Institutional Software
Custom Software and Services
Investment Data, Market Data, and Indexes
Fund, Stock, and Credit Research
Advisory, Retirement, and Portfolio Management Services
Independent Advisor Software and Services
Financial Communications
Investor Websites and Publications

Morningstar 2011/2012

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