Fidelity Personalized Portfolios A managed account service from Fidelity Investments.
Fidelity Personalized Portfolios: A tailored approach to managing your assets. Personalized investment solutions shaped to help meet your goals A disciplined investment process and tax-sensitive investment strategies* tailored to your situation Fundamental research across a broad selection of investments the cornerstone of our actively managed portfolios Complete account access and portfolio transparency to keep you informed and up to date A relationship with a trusted partner who will provide daily oversight and ongoing management of your account Fidelity s Strategic Advisers, Inc.: A team of experienced investment professionals to build and manage your portfolio. Your portfolio will be managed by Fidelity s Strategic Advisers, Inc. (Strategic Advisers). Strategic Advisers asset allocation and risk management profes sionals have provided portfolio management services to discerning investors for over 25 years and currently manage more than $195 billion in assets. 1 Strategic Advisers will actively manage your personalized portfolio according to their disciplined, research-driven approach, using tax-sensitive investment strategies that seek to enhance after-tax returns. 1 Strategic Advisers, Inc. assets under management as of March 31, 2016.
A personalized approach to institutional-quality investment management At the center of your personalized portfolio will be a dedicated investment manager employing an investment strategy based on your personal financial situation. Your portfolio will be actively managed to identify appropriate opportunities for investments and trades. Our portfolio construction process focuses not only on longterm asset allocation, but also on selecting the right investment vehicles. When determining which investments are most appropriate for our clients, we consider: asset level, costs, market segments, and overall investment objectives. We employ a range of investment vehicles including: Mutual funds Exchange-traded funds (ETFs) Separately Managed Accounts (SMAs) 2 We consider investment decisions based on client-specific security preferences or restrictions. We also pay special attention to account rebalancing based on client contributions and withdrawals. Through this process, we consider multiple aspects of your portfolio, delivering per-client individual portfolio management. Ongoing tax-sensitive investing Investors with substantial assets understand that taxes can have a significant impact on investment earnings. But managing the potential impact of taxes on your portfolio can be complex. Strategic Advisers will make every investment decision in your portfolio with careful consideration of certain federal income tax consequences, employing a select blend of tax-sensitive investment management strategies because it s not what you earn, but what you keep that really matters. TAX-SENSITIVE INVESTMENT STRATEGIES 3 Invest in municipal bond funds Harvest tax losses Manage exposure to distributions Defer realization of short-term gains Harvest tax losses to help reduce the negative impact of taxes on your portfolio s total return Defer realization of short-term gains in favor of seeking long-term capital gains, as appropriate Seek to manage exposure to fund distributions that can have costly tax implications Invest in national and/or state-specific municipal bond funds, when appropriate 2 Please note that SMAs are subject to account minimum requirements and, in addition to the basic advisory fees for a Fidelity Personalized Portfolio, you will be charged a separate fee for any SMAs held in your account. Please refer to your Client Agreement for detailed fee information. 3 Fidelity Personalized Portfolios applies tax-sensitive investment management techniques (including tax-loss harvesting) on a limited basis, at its discretion, primarily with respect to determining when assets in a client s account should be bought or sold. As a discretionary investment management service, any assets contributed to an investor s account which Fidelity Personalized Portfolios does not elect to retain may be sold at any time after contribution. An investor may have a gain or loss when assets are sold.
AVERAGE ANNUAL RETURN % Access to Equity Separately Managed Accounts 2 Depending on your portfolio, Strategic Advisers Investment Team may recommend the use of equity Separately Managed Accounts (SMAs). Because equity SMAs allow clients to own stocks directly, they can provide even greater opportunities to personalize your account and apply tax-sensitive strategies* such as tax-loss harvesting, avoiding short-term gains, and managing tax lots. As the chart below illustrates, taxes can significantly reduce returns. We believe equity SMAs can help mitigate this risk. Strategic Advisers taxsensitive investment management is applied to SMAs (if applicable) and to your entire Fidelity Personalized Portfolio. TAXES CAN SIGNIFICANTLY REDUCE RETURNS 4 1926 2015 12% 10% 8% 6% 4% 2% 0% 10.0% Stocks 8.0% Stocks after taxes 5.6% Bonds 3.5% Bonds after taxes Analysis of historical performance by the research firm Morningstar, Inc. highlights the potential impact of taxes on investment performance. See back cover for more information. 5 Research: the foundation of our investment management As your wealth grows, so does the sophistication of your investment needs. Having access to a full range of investments to execute your strategy is important. However, the availability of thousands of stocks, bonds, mutual funds, and ETFs makes sorting through the options and understanding how they interact in your own portfolio challenging and can require substantial time and research. Strategic Advisers spends an enormous amount of time and energy researching and selecting a wide variety of appropriate investments for your portfolio. Our research analysts closely evaluate hundreds of portfolio managers and funds, selected from thousands of available investments, and generate proprietary reports advising the Investment Team in the investment selection process. Our dedication to the research process is designed to help ensure that you are well diversified and that your investment strategy remains on track to help you meet your long-term goals. Rigorous investment reviews Your personalized portfolio will undergo a regular, systematic review process using proprietary technology to analyze your holdings in relation to your long-term asset allocation, risk profile, and opportunities for tax-sensitive investment management;* your dedicated investment manager will make adjustments when necessary. Your dedicated Fidelity representative will serve as your personal liaison to the Investment Team to explain activity in your portfolio. 4 Past performance is no guarantee of future results. This chart is for illustrative purposes only and does not represent actual or future performance of any investment option. Returns include the reinvestment of dividends and other earnings. Stocks are represented by the Ibbotson Large Company Stock Index. The Ibbotson Large Company Stock Index is represented by the S&P 500 Composite Index (S&P 500) from 1957 to present, and the S&P 90 from 1926-1956. Government bonds are represented by the 20-year U.S. government bond, cash by the 30-day U.S. Treasury bill, and inflation by the Consumer Price Index. The data assumes reinvestment of income and does not account for transaction costs. Please note that indexes are unmanaged and are not illustrative of any particular investment. It is not possible to invest directly in an index. 2016 Morningstar, Inc. All rights reserved. 3/1/2016.
Dedicated service professionals We understand it s important for you to always know what s going on with your money. To help keep your portfolio aligned with your needs, you will have a one-on-one relationship with a dedicated service professional who will: Reach out to you on a regular basis to keep you up to date about activity in your account Communicate your needs and preferences to the Investment Team Conduct a comprehensive annual review with you to assess potential changes to your goals or proposed investment strategy Be available to answer any questions you might have about your account Keeping you connected to your investments To keep you informed about your account, we will: Make your account information available online, around the clock, 6 in the spirit of complete account transparency Provide market analysis to explain the market conditions influencing the decisions of your Investment Team Send a monthly statement detailing your account holdings and activity, including trades 6 Fidelity availability and response times may be subject to market conditions.
Fidelity Personalized Portfolios For more information or to set up an appointment, please contact your Fidelity representative at 800-544-9371.
Introducing Fidelity Personalized Portfolios: A managed account service from Fidelity. Fidelity Personalized Portfolios offers professional investment management to Fidelity clients with complex portfolios. Benefits include: Personalized portfolio creation based on your goals and preferences, including the ability to exclude or include certain investments or asset classes A broad range of investment options, including stocks, bonds, mutual funds, ETFs, and Separately Managed Accounts (SMAs) when appropriate In-depth research and day-to-day analysis Your personalized portfolio will be constructed according to your personal financial situation, and managed with a sophisticated methodology that incorporates tax-sensitive investment strategies.* You will receive ongoing account-related information and communications and have a dedicat ed Fidelity representative who will serve as your personal liaison to the Investment Team.
5 Taxes Can Significantly Reduce Returns data, Morningstar, Inc. 3/1/2016. Federal income tax is calculated using the historical marginal and capital gains tax rates for a single taxpayer earning $120,000 in 2015 dollars every year. This annual income is adjusted using the Consumer Price Index in order to obtain the corresponding income level for each year. Income is taxed at the appropriate federal income tax rate as it occurs. When realized, capital gains are calculated assuming the appropriate capital gains rates. The holding period for capital gains tax calculation is assumed to be five years for stocks, while government bonds are held until replaced in the index. No state income taxes are included. Stock values fluctuate in response to the activities of individual companies and general market and economic conditions. Generally, among asset classes stocks are more volatile than bonds or short-term instruments. Government bonds and corporate bonds have more moderate short-term price fluctuations than stocks, but provide lower potential long-term returns. U.S. Treasury bills maintain a stable value if held to maturity, but returns are generally only slightly above the inflation rate. Although bonds generally present less short-term risk and volatility than stocks, bonds do entail interest rate risk (as interest rates rise, bond prices usually fall, and vice versa), issuer credit risk, and the risk of default, or the risk that an issuer will be unable to make income or principal payments. The effect of interest rate changes is usually more pronounced for longer-term securities. Additionally, bonds and short-term investments entail greater inflation risk, or the risk that the return of an investment will not keep up with increases in the prices of goods and services, than stocks. For more information or to set up an appointment, please contact your Fidelity representative at 800-544-9371. Keep in mind that investing involves risk. The value of your investment will fluctuate over time and you may gain or lose money. The tax information contained herein is general in nature, is provided for informational purposes only, and should not be construed as legal or tax advice. Fidelity does not provide legal or tax advice. *Strategic Advisers, Inc. ( Strategic Advisers ), applies tax-sensitive investment management techniques in connection with Fidelity Personalized Portfolios (including tax-loss harvesting ) on a limited basis, at its discretion, primarily with respect to determining when assets in a client s account should be bought or sold. As a discretionary investment manager, Strategic Advisers may elect to sell assets in an account at any time. A client may have a gain or loss when assets are sold. Strategic Advisers does not currently invest in tax-deferred products, such as variable insurance products or tax-managed funds, but may do so in the future if it deems such to be appropriate for a client. Strategic Advisers does not actively manage for state or local taxes; foreign taxes on non-u.s. investments; or estate, gift, or generation-skipping transfer taxes. Strategic Advisers relies on information provided by clients in an effort to provide tax-sensitive investment management and does not offer tax advice. Strategic Advisers can make no guarantees as to the effectiveness of the tax-sensitive investment management techniques applied in serving to reduce or minimize a client s overall tax liabilities or as to the tax results that may be generated by a given transaction. Clients are responsible for all tax liabilities arising from transactions in their accounts, for the adequacy and accuracy of any positions taken on tax returns, for the actual filing of tax returns, and for the remittance of tax payments to taxing authorities. Fidelity Personalized Portfolios is a service of Strategic Advisers, Inc., a registered investment adviser and a Fidelity Investments company, and may be offered through Strategic Advisers, Inc., or Fidelity Personal Trust Company, FSB ( FPTC ), a federal savings bank. Nondeposit investment products and trust services offered through FPTC and its affiliates are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency, are not obligations of any bank, and are subject to risk, including possible loss of principal. This service provides discretionary money management for a fee. Brokerage services are provided by Fidelity Brokerage Services LLC. Custody and other services are provided by National Financial Services LLC. Both are Fidelity Investments companies and members of NYSE and SIPC. Fidelity Brokerage Services LLC, Member NYSE and SIPC, 900 Salem Street, Smithfield, RI 02917 2016 FMR LLC. All rights reserved. 550510.9.0 1.914425.108