The Fund’s equity sleeve underperformed its benchmark, the S&P 500 Index, due in part to our industrials and consumer discretionary holdings.
Our fixed income sleeve outperformed its benchmark, the U.S. Aggregate Bond Index.
We see the economy as conducive for incremental gains in equities, while we are mindful of numerous risk factors that could weigh on bonds.
Our asset allocation mix remains largely unchanged; we favor stocks whose valuations have not become stretched and have moved into higher quality fixed income securities.