AAII Asset Allocation Models

Asset Allocation Index Explanation Splash image

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Popular Investment Benchmarks   (Data as of 7/31/2010)
Stocks Risk Index 1 yr 5 yrs 10 yrs
Large-Cap Stocks 109 13.72% -0.25% -0.86%
Mid-Cap Stocks 119 22.23% 2.15% 5.38%
Small-Cap Stocks 129 22.18% 1.51% 4.94%
International Stocks 132 5.49% 2.24% 0.88%
Emerging Markets Stocks 186 19.57% 12.27% 11.66%
Fixed Income
Intermediate Bonds 24 8.77% 6.65% 6.97%
Short-Term Bonds 21 3.26% 4.68% 4.81%
Overall market
Vanguard Total Stock Market Index (VTSMX) 101 15.0% 0.3% 0.1%

AAII Asset Allocation Models

What is your investor profile? Follow one of our recommended allocations and check back frequently for monthly return data.

Investor Profile Risk Index 1 yr 5 yrs 10 yrs
Aggressive Investor
  • Age 18-35
  • 30+ Years Investment Horizon
 100 15.6% 3.0% 3.9%
Moderate Investor
  • Age 35-55
  • 20+ Years Investment Horizon
 100 13.8% 3.5% 4.2%
Conservative Investor
  • Age 55+
  • 10+ Years Investment Horizon
 100 12.0% 3.5% 4.1%
 Suggested Allocation Breakdowns
Aggressive


   20% Large-Cap Stocks
   20% Mid-Cap Stocks
   20% Small-Cap Stocks
   20% International Stocks
   10% Emerging Markets Stocks
   10% Intermediate Bonds
   0% Short-Term Bonds
Moderate


   20% Large-Cap Stocks
   20% Mid-Cap Stocks
   10% Small-Cap Stocks
   15% International Stocks
   5% Emerging Markets Stocks
   30% Intermediate Bonds
   0% Short-Term Bonds
Conservative


   25% Large-Cap Stocks
   10% Mid-Cap Stocks
   10% Small-Cap Stocks
   5% International Stocks
   0% Emerging Markets Stocks
   40% Intermediate Bonds
   10% Short-Term Bonds
Aggressive Portfolio Return
YTD: 2.1%
1 yr: 15.6%
5 yrs: 3.0%
10 yrs: 3.9%
Moderate Portfolio Return
YTD: 3.2%
1 yr: 13.8%
5 yrs: 3.5%
10 yrs: 4.2%
Conservative Portfolio Return
YTD: 4.2%
1 yr: 12.0%
5 yrs: 3.5%
10 yrs: 4.1%

Broad Allocation Scenarios
Aggressive Investor

Allocations

Aggressive Portfolio Return
1 yr: 15.6%
5 yrs: 3.0%
10 yrs: 3.9%

Characteristics
Growth: Substantial
Income: Very Low
Risk: Substantial Year-to-Year Volatility of Portfolio Value
10% Average Annual Growth in Value
-30% Bad Year

Time Horizon
Age: often 18-35
30+Years: Long Investment Horizon
For investors who are very risk tolerant
Transition: 80% Diversified Stock
20% Fixed Income		 Investors, as they age, usually transition their portfolios toward less risky and less aggressive asset allocations.

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Moderate Investor

Allocations

Moderate Portfolio Return
1 yr: 13.8%
5 yrs: 3.5%
10 yrs: 4.2%

Characteristics
Growth: Moderate
Income: Low
Risk: Moderate Year-to-Year Volatility of Portfolio Value
8% Average Annual Growth in Value
-20% Bad Year

Time Horizon
Age: often 35-55
20+Years: Mid-Term Investment Horizon
 
For investors who can tolerate some risk
Transition: 60% Diversified Stock
40% Fixed Income		 Investors, as they get closer to retirement, usually transition their portfolios toward lower risk and more conservative allocations.

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Conservative Investor

Allocations
Conservative Portfolio Return
1 yr: 12.0%
5 yrs: 3.5%
10 yrs: 4.1%

Characteristics
Growth: Low
Income: Moderate
Risk: Low Year-to-Year Volatility of Portfolio Value
6% Average Annual Growth in Value
-15% Bad Year

Time Horizon
Age: often 55+
10+Years: Short-Term Investment Horizon
 
For investors who are not risk tolerant

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