AllianceBernstein Continues to Innovate in Target-Date Design by Adding Volatility Management Component to Retirement Strategies
February 16 2010 - 1:03PM
PR Newswire (US)
NEW YORK, Feb. 16 /PRNewswire-FirstCall/ -- In early April 2010,
AllianceBernstein will add a new Volatility Management component to
its Retirement Strategies target-date mutual funds. The Volatility
Management component is designed to reduce the market risk of the
funds during periods of extreme volatility. According to Seth J.
Masters, Chief Investment Officer of Blend Strategies and Defined
Contribution at AllianceBernstein, "This important enhancement is
the result of a multiyear firmwide research effort, which created
new tools we believe can be applied to 'smooth the ride' and
improve retirement outcomes for defined contribution plan
participants. The project demonstrates our ongoing work to deliver
our best thinking on target-date design to plan sponsors and
investors." AllianceBernstein's Volatility Management approach
seeks to balance risk and return, placing primary emphasis on
controlling risk. This differs from traditional tactical asset
allocation which focuses primarily on predicting asset-class
returns and attempting to time the market to take advantage of
short-term opportunities to enhance returns. "Target-date funds
naturally reduce the volatility in a portfolio by reducing the
exposure to equities over time as an investor approaches and moves
through retirement. With Volatility Management, we can now more
explicitly manage risk in target-date portfolios," says Thomas J.
Fontaine, Head of Defined Contribution at AllianceBernstein. "We
believe our new risk management tools will allow us to adjust
portfolios during extreme market cycles such as the recent credit
crunch, moderating short-term negative performance -- but
importantly, without sacrificing long-term return potential."
AllianceBernstein will allocate up to 20% of the existing
Retirement Strategies target-date funds into the new Volatility
Management component, with the allocation varying by vintage. This
Volatility Management component will invest in a mix of equities
and REITs in normal markets but will have the ability to
dynamically de-risk into bonds and cash when it's appropriate to
reduce overall portfolio risk. The Volatility Management component
will replace a portion of the equities and REITs so the long-term
strategic allocation does not change following the introduction of
this component into the Retirement Strategies funds. An
institutional implementation of Volatility Management will be
available in the second quarter of 2010 for use in customized
target-date portfolios, including AllianceBernstein's Customized
Retirement Strategies(SM) service for large-market defined
contribution plans. AllianceBernstein Defined Contribution
Investments (ABDC) is a business unit of AllianceBernstein that
offers a full range of solutions to meet the needs of defined
contribution plan sponsors and participants. For more information
on ABDC, please go to http://www.abdc.com/. Cautions regarding
Forward-Looking Statements Certain statements provided by
management in this news release are "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements are subject to risks,
uncertainties and other factors that could cause actual results to
differ materially from future results expressed or implied by such
forward-looking statements. The most significant of these factors
include, but are not limited to, the following: the performance of
financial markets, the investment performance of sponsored
investment products and separately managed accounts, general
economic conditions, industry trends, future acquisitions,
competitive conditions, and government regulations, including
changes in tax regulations and rates and the manner in which the
earnings of publicly-traded partnerships are taxed. We caution
readers to carefully consider such factors. Further, such
forward-looking statements speak only as of the date on which such
statements are made; we undertake no obligation to update any
forward-looking statements to reflect events or circumstances after
the date of such statements. For further information regarding
these forward-looking statements and the factors that could cause
actual results to differ, see "Risk Factors" and "Cautions
Regarding Forward-Looking Statements" in our Form 10-K for the year
ended December 31, 2009. Any or all of the forward-looking
statements that we make in this news release, Form 10-K, other
documents we file with or furnish to the U.S. Securities and
Exchange Commission, and any other public statements we issue, may
turn out to be wrong. It is important to remember that other
factors besides those listed in "Risk Factors" and "Cautions
Regarding Forward-Looking Statements", and those listed above,
could also adversely affect our financial condition, results of
operations and business prospects. About AllianceBernstein
AllianceBernstein is a leading global investment-management firm
that offers high-quality research and diversified investment
services to institutional clients, individuals and private clients
in major markets around the world. AllianceBernstein employs more
than 500 investment professionals with expertise in growth
equities, value equities, fixed-income securities, blend strategies
and alternative investments and, through its subsidiaries and joint
ventures, operates in more than 20 countries. AllianceBernstein's
research disciplines include fundamental research, quantitative
research, economic research and currency forecasting capabilities.
Through its integrated global platform, AllianceBernstein is well
positioned to tailor investment solutions for its clients.
AllianceBernstein also offers independent research, portfolio
strategy and brokerage-related services to institutional investors.
As of December 31, 2009, AllianceBernstein Holding L.P. ("Holding")
(NYSE: AB) owned approximately 36.5% of the issued and outstanding
AllianceBernstein Units and AXA, one of the largest global
financial services organizations, owned an approximate 62.1%
economic interest in AllianceBernstein. AllianceBernstein Defined
Contribution Investments is a unit of AllianceBernstein L.P. and
AllianceBernstein Investments, Inc. is an affiliate of
AllianceBernstein L.P. and member of FINRA. ©2010 AllianceBernstein
L.P. DATASOURCE: AllianceBernstein CONTACT: Jennifer DeLong, Senior
Marketing Director, Defined Contribution Investments,
+1-212-969-6689, ; or John Meyers, Media, +1-212-969-2301, Web
Site: http://www.abdc.com/
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