Slight Cut in Equity Exposure Amid Weakening Investment Environment | Diversified - 03/17/2025

Portfolio Adjustments

Conservative

• Current stock exposure is 28.5%

• Benchmark Stock Exposure is 30%

• Sell: -2% iShares MSCI USA Momentum Factor ETF (MTUM)

• Added to Existing Holding: +2% Guggenheim Total Return Bond (GIBIX)

Moderate

• Current Stock Exposure is 63.5%

• Benchmark Stock Exposure is 60%

• Sell: -3% iShares MSCI USA Momentum Factor ETF (MTUM)

• Added to Existing Holding: +3% Dodge & Cox Global Bond Fund (DODLX)

Aggressive

• Current stock exposure is 89.5%.

• Benchmark Stock Exposure is 85%.

• Sell: -2.5% iShares MSCI USA Momentum Factor ETF (MTUM)

• Added to Existing Holding: +2.5% iShares U.S. Treasury Bond ETF (GOVT)

The long-term market outlook remains positive, partly due to a healthy consumer driven by strong wage growth and low unemployment. However, our risk model is beginning to signal a weakening risk environment, reflected in a neutral technical outlook and rising concerns about valuations due to declining earnings estimates for 2025.

Given these factors, the investment committee has approved a reduction in equity exposure: 2.5% for our aggressive portfolios, 3% for moderate portfolios, and 2% for conservative portfolios.

Charles Schwab sent you a trade confirmation with the exact trades we placed in your portfolio. Please let us know if you would like to review these trades or your portfolio.

-SCM Investment Committee