The management team employs a disciplined top-down approach to asset allocation.
Benchmark: 60/40 hybrid (S&P 500 Index & Barclays U.S. Aggregate Bond Index)
The Multi-Asset Balanced Allocation strategy applies a blended investment style and invests in a diversified portfolio of common stocks, investment grade fixed income securities and cash equivalents with varying asset allocations depending on our assessment of market conditions.
Generally, we will invest 45% to 75% in equity securities, such as common stocks and convertible securities, 25% to 55% in investment grade fixed income securities, such as corporate bonds, U.S. government and agency securities, mortgage-backed securities and asset-backed securities, and up to 30% of its net assets in cash, cash equivalent, or other types of short-term money market instruments. The Fund may invest in companies with stock market capitalizations of at least $100 million. The dollar-weighted average maturity of the fixed income allocation is normally expected to range from four to 12 years, but may vary in response to market conditions.
The equity strategies may use derivatives as a substitute for taking a position in an underlying asset, to increase returns, to manage risk, or as a part of a hedging strategy. Although we may invest in derivatives of any kind, we generally use futures contracts and option on futures contracts for the purpose of managing exposure to the securities markets or to movements in interest rates or currency values.
PNC Balanced Allocation Fund (I shares)
Asset allocation cannot guarantee a profit or prevent a loss. An investment in the Fund is subject to interest rate risk, which is the possibility that a Fund's yield will decline due to falling interest rates and the potential for bond prices to fall as interest rates rise. High yield bond investing includes special risks. Investments in lower rated and unrated debt securities are subject to a greater loss of principal and interest than investments in higher rated securities. The values of mortgage-backed securities depend on the credit quality and adequacy of the underlying assets or collateral and may be highly volatile. International investments are subject to special risks not ordinarily associated with domestic investments, including currency fluctuations, economic and political change and differing accounting standards that may adversely affect portfolio securities. These risks may be heightened in emerging markets. Investments in value companies can continue to be undervalued for long periods of time and be more volatile than the stock market in general. Investments in growth companies can be more sensitive to the company's earnings and more volatile than the stock market in general. Investments in small and mid- capitalization companies present a greater risk of loss than investments in large companies. The Fund may invest a portion of its assets in derivatives. Derivative instruments include options, futures and options on futures. A small investment in derivatives could have a potentially large impact on the Fund’s performance. The Fund may be unable to terminate or sell a derivatives position. Derivative counterparties may suffer financial difficulties and may not fulfill their contractual obligations.
You should consider the investment objectives, risks, charges, and expenses of the PNC Funds carefully before investing. A prospectus or summary prospectus with this and other information may be obtained at 800-622-FUND (3863) or pncfunds.com. Please read it carefully before investing.
PNC Capital Advisors, LLC, a subsidiary of The PNC Financial Services Group Inc., serves as investment adviser and co-administrator to PNC Funds and receives fees for its services. PNC Funds are distributed by PNC Funds Distributor, LLC, which is not affiliated with the adviser and is not a bank.