Blend Growth of Value Styles

Stocks and bonds aren't the only pairings that allow investors to exploit low correlations. Historically, investing in different equity styles has provided opportunities for greater returns with risk reduction. Growth and value equity styles have cyclically alternated leadership through history, so blending the two styles equally within the equity component of a portfolio can help to reduce its volatility.

Blending Growth and Value Styles Enhanced Equity Returns

Source: CDA Weisenberger

Past performance is not indicative of future results. The S&P 500 Stock Index is an unmanaged index of 500 U.S. companies and is a common measure of the performance of the overall U.S. stock market. "U.S. Stock Fund Composite" represents the Lipper Large Cap Core Fund Average, an unmanaged average. The 50% Growth Index/50% Value Index represents a blend of the Russell 1000 Growth Index, which comprises those Russell 1000 stocks which have a greater-than-average P/E ratio and growth orientation. The Russell 1000 Value Index comprises those Russell 1000 stocks that have a less-than-average P/E ratio and growth orientation. The unmanaged Russell 1000 Index is a capitalization-weighted index comprises the largest 1,000 companies traded on U.S. stock exchanges. These returns are for the period from 1/1/80 - 12/31/04, and do not include fees and expenses associated with an investment in a mutual fund. An investor cannot invest directly in an index, and its results are not indicative of any investment.

"Value investing" and "growth investing" do not guarantee a profit or eliminate risk. Not all companies whose stocks are considered to be value stocks are able to turn their business around or successfully employ corrective strategies. This would result in stock prices that do not rise as initially expected. Growth stocks can have relatively high valuations, and can be more risky than an investment in a company with more modest growth expectations If a growth stock company should fail to meet these high earnings expectations, the price of these stocks can be negatively affected.

This report is prepared for general circulation and is for informational purposes only. It is not intended as an offer or solicitation for the purchase or sale of any financial instrument or service. Market prices and other data may be obtained from outside sources and is not warranted as to completeness or accuracy. Any comments, statements and/or recommendations made herein do not necessarily reflect those of First Allied Securities, Inc., its subsidiaries or affiliates, and are subject to change without notice.