See how a well-diversified four asset group portfolio can provide the optimal approach to working towards your investment goals.
A Focus on Asset Allocation
When pursuing your specific investment goals, a well-diversified portfolio can help you meet your needs.
Asset Allocation
At Wells Fargo Private Bank, asset allocation serves as the foundation of our investment process. We believe a well-diversified four asset group portfolio provides the optimal approach to working towards your investment goals
Our approach leverages:
To help determine your appropriate asset allocation strategy, we consider several factors including your investment goals, time horizon and risk tolerance.
Why diversification is important
As market conditions change over time, assets such as equities, bonds and cash can react differently. While equities can be a primary contributor to the growth potential in a diversified portfolio, uncorrelated assets such as bonds and cash can provide return potential when equity markets correct. By constructing a well-diversified portfolio and appropriate asset allocation we are able to help you mitigate some of the risk while providing opportunity for potential growth.
Customization
To help implement an asset allocation strategy based on your needs, your investment strategist chooses from a wide range of investment offerings, including: Passive and Active management strategies, In-house and third party solutions, tax efficient investing, social impact investing and private placements, all of which are carefully researched by the experienced financial team of the Wells Fargo Investment Institute and selected for use in your portfolio by your investment strategist.
With a keen focus on a well-diversified portfolio, appropriate asset allocation and insights from Wells Fargo Investment Institute we can help you meet your specific investment objectives.
Contact us to schedule a meeting with a Private Bank investment management professional.
Brokerage services are offered through Wells Fargo Advisors. Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC, and Wells Fargo Advisors Financial Network, LLC, Members SIPC, separate registered broker-dealers and non-bank affiliates of Wells Fargo & Company.
Asset allocation and diversification are investment methods used to help manage risk. They do not guarantee investment returns or eliminate risk of loss including in a declining market.
Real Estate: Investment in real estate securities include risks, such as the possible illiquidity of the underlying properties, credit risk, interest rate fluctuations, and the impact of varied economic conditions.
Stocks offer long-term growth potential, but may fluctuate more and provide less current income than other investments. An investment in the stock market should be made with an understanding of the risks associated with common stocks including market fluctuations.
Fixed Income: Investments in fixed-income securities are subject to market, interest rate, credit and other risks. Bond prices fluctuate inversely to changes in interest rates. Therefore, a general rise in interest rates can result in the decline in the bond’s price. Credit risk is the risk that an issuer will default on payments of interest and/or principal. This risk is heightened in lower rated bonds. If sold prior to maturity, fixed income securities are subject to market risk. All fixed income investments may be worth less than their original cost upon redemption or maturity.
Income from municipal securities is generally free from federal taxes and state taxes for residents of the issuing state. While the interest income is tax-free, capital gains, if any, will be subject to taxes. Income for some investors may be subject to the federal Alternative Minimum Tax (AMT).
Options involve risk and are not appropriate for all investors. Before opening an option position, a person must receive a copy of “Characteristics and Risks of Standardized Options.” This document is available from the Options Clearing Corporation, 125 S. Franklin Street, Suite 1200, Chicago, Illinois 60606. Please read it carefully before investing.
Alternative investments, such as hedge funds, funds of hedge funds, managed futures, private capital, real assets and real estate funds, are not suitable for all investors. They are speculative, highly illiquid, and are designed for long-term investment, and not as trading vehicle. These funds carry specific investor qualifications which can include high income and net-worth requirements as well as relatively high investment minimums. The high expenses associated with alternative investments must be offset by trading profits and other income which may not be realized. Unlike mutual funds, alternative investments are not subject to some of the regulations designed to protect investors and are not required to provide the same level of disclosure as would be received from a mutual fund. They trade in diverse complex strategies that are affected in different ways and at different times by changing market conditions.
Strategies may, at times, be out of market favor for considerable periods with adverse consequences for the fund and the investor. An investment in these funds involve the risks inherent in an investment in securities and can include losses associated with speculative investment practices, including hedging and leveraging through derivatives, such as futures, options, swaps, short selling, investments in non-U.S. securities, “junk” bonds and illiquid investments. The use of leverage in a portfolio varies by strategy.
Leverage can significantly increase return potential but create greater risk of loss. At times, a fund may be unable to sell certain of its illiquid investments without a substantial drop in price, if at all. Other risks can include those associated with potential lack of diversification, restrictions on transferring interests, no available secondary market, complex tax structures, delays in tax reporting, valuation of securities and pricing. An investment in a fund of funds carries additional risks including asset-based fees and expenses at the fund level and indirect fees, expenses and asset-based compensation of investment funds in which these funds invest. An investor should review the private placement memorandum, subscription agreement and other related offering materials for complete information regarding terms, including all applicable fees, as well as the specific risks associated with a fund before investing.
Some alternative investments and real assets may be available to pre-qualified investors only.
Private capital funds are complex, speculative investment vehicles and are not appropriate for all investors. They are generally open to qualified investors only and carry high costs, substantial risks, and may be highly volatile. There is a lack of transparency regarding the underlying assets. They do not represent a complete investment program. The investment returns may fluctuate and are subject to market volatility, so that an investor’s shares, when redeemed or sold, may be worth more or less than their original cost. Private capital funds are not required to provide investors with periodic pricing or valuation and are not subject to the same regulatory requirements as mutual funds. An investment in a private equity fund involves the risks inherent in an investment in securities, as well as specific risks associated with limited liquidity, the use of leverage and illiquid investments. Private capital investments often demand long holding periods to allow for a turnaround and exit strategy. A fund’s offering documents should be carefully reviewed prior to investing.
The Private Bank offers products and services through Wells Fargo Bank, N.A., Member FDIC, and its various affiliates and subsidiaries. Wells Fargo Bank, N.A. is a bank affiliate of Wells Fargo & Company.
Wells Fargo Bank, N.A. offers various advisory and fiduciary products and services including discretionary portfolio management. Wells Fargo affiliates, including Financial Advisors of Wells Fargo Advisors, a separate non-bank affiliate, may be paid an ongoing or one-time referral fee in relation to clients referred to the bank. The bank is responsible for the day-to-day management of the account and for providing investment advice, investment management services and wealth management services to clients. The role of the Financial Advisor with respect to the Bank products and services is limited to referral and relationship management services. Some of The Private Bank experiences may be available to clients of Wells Fargo Advisors without a relationship with Wells Fargo Bank, N.A.
Wells Fargo Investment Institute, Inc., (WFII) is a registered investment adviser and wholly owned subsidiary of Wells Fargo Bank, N.A., a bank affiliate of Wells Fargo & Company.
Wells Fargo and Company and its Affiliates do not provide tax or legal advice. This communication cannot be relied upon to avoid tax penalties. Please consult your tax and legal advisors to determine how this information may apply to your own situation. Whether any planned tax result is realized by you depends on the specific facts of your own situation at the time your tax return is filed.
Deposit products offered by Wells Fargo Bank, N.A. Member FDIC.
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