Source: Zephyr StyleADVISOR. Cash is represented by the Citigroup one-month T-Bill Index. U.S. bonds are represented by the Lehman Brothers U.S.
Aggregate Bond Index. U.S. stocks are represented by the Russell 3000. International stocks are represented by the MSCI EAFE Index. Global real
estate securities are represented by the S&P Citigroup World Property Broad Market Index.
Citigroup T-Bill Index tracks short-term U.S. government debt instruments. Russell 3000® Index measures the performance of the 3000 largest U.S.
companies based on total market capitalization, which represents approximately 98% of the investable U.S. equity market. Lehman Brothers Aggregate
Bond Index is made up of the Lehman Brothers Government/Corporate Bond Index, Mortgage-Backed Securities Index, and Asset-Based Securities Index,
including securities that are of investment grade quality or better, have at least one year to maturity, and have an outstanding par value of at least $100
million. S&P/Citigroup World Property Broad Market Index is an unmanaged market-weighted total return index that consists of many companies
from developed markets with floats larger than $100 million and that derive more than half of their revenue from property-related activities.
1) Risk is measured by standard deviation—a statistical measure of volatility that captures the degree to which an investment’s returns vary from
its long-term average. The higher the standard deviation, the greater the volatility. This chart is for illustrative purposes only and is not intended to
represent the returns of any specific security. Past performance is no guarantee of future results. An investment cannot be made directly in an index.
Asset allocation cannot assure a profit or protect against loss in a declining market. Treasury securities are backed by the full faith and credit of the
U.S. government, while other securities noted above—global real estate securities in particular—are not. While common stocks have historically generated
higher average returns than fixed income securities, common stocks have also experienced significantly more volatility in those returns. Risks of
investing in global real estate securities typically include: (i) oversupply of real estate due to new construction, (ii) decline in demand due to economic
recession and (iii) reduction in capital availability, which could cause prices to decline. Foreign securities also involve special risks, including currency
fluctuations, lower liquidity, political and economic uncertainties, and differences in accounting and disclosure standards. |
| LOW CORRELATIONS1 to OTHER MARKETS
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Correlation of Global Real Estate Securities2 to Stocks and Bonds
Source: Zephyr StyleADVISOR. 1) A correlation of +1 means the securities move perfectly in tandem; a correlation of -1 means the returns move in opposite
directions. 2) S&P Citigroup World Property Broad Market Index. 3) The MSCI World Index is a free float adjusted market capitalization index that
is designed to measure global developed market equity performance. 4) The MSCI EAFE Index is a cap weighted index that monitors the performance of
stocks from Europe, Australasia and the Far East. 5) The Standard & Poor’s 500 Composite Stock Index (S&P 500 Index) is an unmanaged index of 500
large capitalization, publicly traded stocks representing a variety of industries. 6) J.P. Morgan Global Government Bond Index is the most widely used
benchmark for measuring performance and quantifying risk across international fixed income bond markets. Unlike common stocks and other equity
securities, government bonds are obligations of the respective issuing country and are generally backed by the full faith and credit of that country. |
