During the month of April, there were several changes to asset allocation models in the program.
The first change was to reduce small and mid-cap stock exposure across domestic and international equities. Due to Macro headwinds which includes elevated interest rates, uncertain U.S. fiscal policy, and slowing economic growth, PNC Investments reduced small and mid-cap exposure. US small and mid-cap allocation reduction were invested in Large Cap Value. International small cap exposure was reinvested into international large cap.
The second change was to increase high yield and emerging markets bond exposure. With spreads widening, valuations have grown more attractive across high yield bonds and EM bonds. We are shifting from a tactical underweight, back to a neutral weight across high yield and EM bonds.
For accounts in our liquid alternative models we have shifted the allocations to levalize liquid alternative allocations across risk ranges, while also targeting the risks faced by different investors more directly.
We continue to diligently monitor the markets and your account, and we will keep you abreast of any changes to your portfolio allocation and investment selection that we deem appropriate so that you’re well positioned for what’s ahead.