We believe that the goal of every investor can be captured by three primary objectives: Spending, Income & Growth, and Legacy. That is why we divide assets across some combination of those objectives in accordance with each individual’s or institution’s needs.
- Time Horizon: 0-5 years
- Sample Needs: I need ready access to a certain amount of money for expenditures. I do not want these assets to fluctuate greatly in value.
- Income & Growth
- Time Horizon: 6-10 years
- Sample Needs: I need a certain amount of income with some growth. I can tolerate some fluctuations but may need access to this money within 10 years.
- Time Horizon: 11+ years
- Sample Needs: I want this money to grow over time and am not concerned about short-term swings in the value of my investments.
Investors’ short- and Intermediate-term needs are met by the “Spending” and “Income & Growth” sleeves. With spending and income needs addressed in this way, investors can remain more objective and unemotional about short-term swings in their long-term investments. A sample allocation may look something like this:
As the market rises, we may choose to build more reserves by moving assets from the “Legacy” (shown in orange above) to the “Spending” bucket (in red above). As the market falls, we can continue to manage cash flow needs from the “Spending” bucket, while allowing the long-term assets to recover in the “Legacy” bucket.
On average, the market takes 5.1 years to get back to whole from the start of a bear market (and 3.7 years from the bottom). Investors who were patient through even the worst bear markets saw the market return to previous peaks and reach new highs.
Source: Zephyr StyleAdvisor. The information presented herein was compiled from sources believed to be reliable. It is intended for illustrative purposes only and is furnished without guarantee of its completeness or accuracy. Past performance is no indication of future results. See additional disclosures below.
The asset classes and investment styles in each sleeve are determined by their risk and return characteristics. As the market moves over time, valuation and momentum could also play a role in their allocation.
Source: Zephyr StyleAdvisor. An index is not available for direct investment; therefore its performance does not reflect the expenses, fees and taxes generally paid with the active management of an actual portfolio.
For informational purposes only. The information contained herein has been compiled from sources believed to be reliable; however, there is no guarantee of its accuracy or completeness. Any opinions expressed here are statements of judgment on this date and are subject to future change without notice. Past performance is not indicative of future results. This information may contain future predictions that are subject to certain risks and uncertainties, which could cause actual results to differ from those currently anticipated or projected. Please consult your Investment Executive for additional information.
Diversification and asset allocation does not ensure a profit or guarantee a loss. All investing carries risk.
Large Cap is represented by CRSP NYSE 1-2 through 1979. The CRSP index represents the top 20% of companies by market cap that were listed on the New York Stock Exchange beginning in 1926. After 1979, Large Cap is represented by S&P 500 TR. The S&P 500 Index is comprised of 500 U.S. stocks and is an indicator of the performance of the overall U.S. stock market. The inception date used for calculations is 12/31/25.