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Objective

Seeks to provide a diversified option that balances assets that traditionally have higher growth potential with others that typically are more stable.

Strategy

The Balanced Fund blends global public equities with fixed income securities. Public equities are often referred to as stocks and fixed income securities are known as bonds. Global public equities include securities of companies located in the United States as well as outside of the United States in both developed countries, such as Japan and the UK, and emerging market countries, for example, India and China.

The Balanced fund employs a combination of both active and passive investment styles in both its equity and fixed-income allocations. This diverse combination of equities and bonds is designed to help reduce the overall volatility of the fund.

As its name implies, the Balanced Fund is largely “balanced,” or allocated, between the two major types of investments: equities (stocks) and bonds (fixed income).

The majority of this fund is invested in equities (stocks of companies) of a wide variety of corporations around the globe. Historically, over long periods of time, equities have tended to provide higher returns than other investments, such as bonds or money market funds. While there is no guarantee that this will be the case in the future, investment theory suggests that exposure to equities for a portion of a diversified investment portfolio is a key reason investors would select an option like this one.

Because bonds (fixed income) usually have return patterns that are different than stocks, and very often move in the opposite direction than stocks, the bond component of the Balanced Fund tends to have a stabilizing affect on the entire portfolio. This can be particularly valuable when equities are in decline.

The Balanced Fund combines passive investment strategies designed to simply mirror the stock and bond markets’ characteristics and performance with an active investment strategies aiming to produce better than market returns. This gives investors as broad an exposure as possible to the styles that exist in MMBB’s other options. As one style outperforms the others, the Balanced Fund investor will receive at least part of that benefit. The majority of the fund is allocated to equities, both U.S. and international.

 

All investments risk the loss of capital. Although the combination of stocks, bonds and hedge funds in the Balanced Fund creates a very well diversified fund that should cushion shocks in any one of those areas, the return of this fund could still be negative.

Like MMBB’s equity-only investment options, the portion of the Balanced Fund that is allocated to stocks (equities) can decline in value. Among the reasons stocks can lose value include declines in the overall stock markets and reasons related to the profitability, or perceived profitability, of specific companies in which the fund invests.

That portion of the Balanced Fund that is allocated to bonds (fixed income) will be subject to risks of the bond market. Most commonly these include losses from rising interest rates and the risk that issuers of bonds may not be able to meet their interest and principal payments.

The success of all actively managed portions of the fund is highly dependent upon the skill of the manager appointed to them.

Due to the latitude extended to active managers, their portfolios may hold some securities (e.g., debt of emerging markets) that MMBB might not include as stand-alone policy allocations. As a result, more risky investments can be part of the fund’s portfolio.

Values for certain investments are estimated, are not available on a daily basis and/or available only on a lagged basis. This has two implications for a person who is buying or selling units of the Balanced Fund units on any given day. If the non-daily valued investments have declined in value since they were last valued, a person purchasing units of the Balanced Fund could be purchasing them at a slightly higher price than if the actual value were known at the end of each business day. Conversely, if the non-daily valued investments have increased, a seller may redeem units of the Balanced Fund at a lower price—and thus realize less profit—than if the actual value were known at the end of each business day.

If you are uncomfortable with the risks associated with the Balanced Fund, you may want to consider another MMBB investment option.

The information contained herein is for general purpose only. The use of our information should be based on your due diligence and MMBB will not be liable for any success of failure that is directly or indirectly related to the use of the information contained herein. MMBB assumes no responsibility for errors or omissions in the content herein. The information contained herein does not constitute a complete description of our investment services and it does not constitute any tax, legal, financial, or investment advice. In no event shall, MMBB be liable for any special, direct, indirect, consequential, or incidental damages, or any damages whatsoever, whether in action of contract, negligence or tort, arising out of or in connection with the use of the information contained herein.

The performance of the Balanced Fund for varying lengths of time is summarized below. The longer the time period, the more likely it encompasses varying economic and market conditions.

TOTAL NET RETURN AS OF November 28, 2022
Price 1 Day YTD 1 Year 3 Year 5 Year 10 Year
$66.2 -0.88% -16.79% -15.71% 1.44% 2.08% 4.51%

While it is valuable to view investment performance over long-term time horizons, looking at shorter time periods can give one insight as to how returns may fluctuate over shorter time periods. The table below displays calendar year returns.

CALENDAR YEAR RETURNS
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
13.28% 13.54% 1.16% -1.36% 4.35% 16.59% -7.56% 16.69% 12.55% 9.09%

Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Performance is for the stated time period only; performance through the current date may be lower or higher than displayed above due to market fluctuations, manager performance or other reasons.

Total Estimated Annual Expenses

With all MMBB fund offerings, there are no sales charges on purchases, deferred sales charges, short-term or other redemption fees, distribution or 12b-1 fees, dealer commissions or low-balance account service fees.

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A Message for MMBB Members

The MMBB Retirement Plans recordkeeping transition to Fidelity is complete.  Currently only MMBB members with a balance in their retirement account are eligible to register for the MMBB Member Portal. If you don’t have a balance in your MMBB retirement account no action is required at this time.

Eligible members who have not yet registered will receive an invitation including a unique URL to set up their Member Portal credentials. Thank you.

 

 

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