Historical performance

Investments offer varying levels of risk and return. Generally speaking, the more risk associated with an investment, the greater its potential returns over time. So, you'll need to understand the inherent risks and rewards of each investment type, and the strategies that can help you build a fully diversified portfolio within your plan that has the potential to generate the highest potential return for the amount of risk you're willing to assume.

The graph below demonstrates how risk is tied to performance. Keep in mind, however, that historical performance is never a guarantee of future results.

Source: Ibbotson Associates - International Stocks are represented by Morgan Stanley Capital International-Europe, Australia and Far East (Free) Index. Domestic Stocks are represented by the S&P 500. Diversified portfolio is 50% domestic stocks, 30% domestic bonds, 10% international stocks and 10% U.S. Treasury Bills. Domestic Bonds are represented by U.S. Long Term Corporate Bonds. Money Markets are represented by U.S. Treasury Bills. Past performance is no guarantee of future results. The chart is for illustrative purposes only and is not representative of any particular investments.

» Learn more about risks associated with investing.