Asset Allocation

We use the results of your asset allocation questionnaire to help establish the right asset mix for you.

We offer 3 different asset allocations, based upon your tolerance for taking risk in the technology stock part of your portfolio. In each allocation, the technology stock percentage varies, according to how long you have to make investments, and your ability to absorb risk.

1. Our Income Asset Allocation consists of 40% of assets in A rated corporate bonds and corporate preferred stocks, 40% of assets in government bonds, and 20% of all assets in technology stocks.

Our income asset allocation is designed for investors who are retired, and need to draw monthly income from their investment account. Part of the assets are invested in technology stocks to provide some potential for capital growth during your retirement.


2. Our Balanced Asset Allocation consists of 33% of assets in A rated corporate bonds and corporate preferred stocks, 33% of assets in government bonds, and 33% in technology stocks.

Our balanced asset allocation is designed for investors who have at least 10 years to go before retirement. The performance and returns will be more volatile than the Income allocation, but the target overall annualized rate of return, after ten years, is around 8%.


3. Our Equity-Income Asset Allocation consists of 60% of assets in technology stocks, 20% in corporate bonds and preferred stocks, and 20% in government bonds.

 

 

Our equity-income asset allocation is designed for investors who have longer a longer time horizon to invest before they need to draw income from the account. During the holding period, before retirement, the target annualized rate of return should be around 8% to 12%.

The bonds and preferred stocks that PCM selects for your asset allocation goals tend to be very stable, and generally are not candidates for active management.

The performance on the stock portion of your investment account will be more volatile than either the Income or the Balanced allocations. At any moment during the holding period, an individual stock may be down 40% from the target buy price. If you can not tolerate this type of risk during the holding period, the Equity-Income allocation is probably not for you.


We Offer Access To Private Stocks and Private Commercial Real Estate Investments

If your asset allocation results describe a tolerance for high risk, you would be eligible for investments in private technology stock offerings and real estate private investment offerings.

Generally, you would need to be an accredited investor to invest in these private securities.

Because they do not have public prices, the private technology stocks and private real estate offerings are not computed as a part of your asset allocation goals, described in the PCM Investment Advisory Agreement.

If you invest in private offerings, your assets would be held at Folio Institutional, in computer book entry form, which allows you to see your private offerings in your account.

One benefit of the Folio service offering for holding your private securities is their ability to facilitate private market transactions in private securities.