Dynamic Growth: December, 11, 2006

Given the over-optimistic behavior of the equity markets over the last month, we are recommending a more conservative approach to the equity markets. At this time we believe investors should limit their overall exposure to equity markets in accordance to their individual asset allocation models and risk tolerance.

Risk Tolerance Allocations

Current Recommendation

60% Equities: (Normally 95%) Aggressive
50% Equities: (Normally 80%) Moderately Aggressive
40% Equities: (Normally 60%) Moderate
20% Equities: (Normally 40%) Moderately Conservative
10% Equities: (Normally 20%) Conservative

Using the above allocation percentages as an example, the investor who categorizes themselves as “aggressive” would invest $60,000 (or 60%) of the $100,000 (or 100%) they have allocated in the stock market. Everyone’s asset allocation model will vary.

The investor whose is aggressive, and has an asset allocation model that calls for a $50,000 allocation to the stocks, would invest 60% of their assets (or $30,000) in the equity markets.

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