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Portfolio Strategy | Your Goals 

Portfolio Strategy | Your Goals

Increasing Income


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How Can I Find Attractive Yield Without Taking Unnecessary Risk?

We believe investors should consider the income and diversification potential of a broader mix of income-producing asset classes. In a broadly diversified portfolio, any single market risk may hurt less than a portfolio whose income potential is dominated by one or two asset classes. 

Historic Yield

Source: Bloomberg, Barclays Aggregate Bond Index Yield to Worst, S&P 500 12M Yield. Past performance does not guarantee future results, which may vary.

To illustrate this point, a portfolio comprised of seven diversifying asset classes accompanying traditional core equity could achieve a distribution yield of more than 4%, net of mutual fund fees, while also spreading risk across a range of asset classes. 

Traditional Core Diversifiers

Source: Goldman Sachs Asset Management/Strategic Advisory Solutions Portfolio Strategy. Morningstar. Yield assumptions generally represent the asset-weighted average 12-month yield of the Institutional and No-Load Shares, excluding those funds with 12-b(1) fees, in the representative Morningstar peer groups through 12/31/2014. Past performance does not guarantee future results, which may vary.

We believe that bridging the income gap need not introduce unnecessary risk or income concentration into investor portfolios. In today’s low interest-rate environment, well-crafted income portfolios potentially can help investors pursue their income targets.

Learn about why portfolio construction matters and how practical tools can help.
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November 23, 2015 | GSAM Connect
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