Methodology Overview

COMPOSITION

Each Dow Jones Real Return Target Date Index family is a composite of other indexes. These subindexes represent multiple asset classes that include: stocks, bonds, real estate securities, commodities, U.S. nominal bonds and TIPS. These indexes include more asset classes than what currently exist in a single target date index in the market today. Commodities, US real estate securities and US nominal bonds add diversity and are generally considered to potentially counterbalance inflation, while TIPS are guaranteed by the U.S. government to pay interest above the rate of inflation. Only the Dow Jones Real Return Target Date Indexes consider the effects U.S. inflation can have on the value of a portfolio.

Subindexes of the Dow Jones Real Return Target Date Indexes

Asset Class	Subindex
U.S. Large Cap Equity	Dow Jones Global Total Stock Market Index
U.S. Small Cap Equity
U.S. Micro Cap Equity
World ex-U.S. Developed Large Cap Equity
World ex-U.S. Developed Small Cap Equity
Emerging Markets Equity
U.S. Real Estate	Dow Jones U.S. Select Real Estate Securities Index
Commodities	Dow Jones-UBS Commodity Index
U.S. Nominal Bonds	Barclays Capital U.S. Aggregate Bond Index
U.S. TIPS	Barclays Capital U.S. TIPS Index

The methodologies of the subindexes can be obtained from Dow Jones Indexes and Barclays Capital, respectively

REBALANCING: Adjusting for Risk

The Dow Jones Real Return Target Date Indexes measure a systematic shift from index components measuring an aggressive to a conservative asset mix, with a which is designed to reflect on reducing risk. The index methodology begins with a mix of asset clases intended to represent measuremeant of the capital accumulation phase and carefully transitions to index components measuring a capital preservation phase.

A person planning to retire in 2040 may choose the Dow Jones Real Return 2040 Index as a benchmark to measure performance of a lifecycle fund with a maturity date of 2040. For measuring portfolios geared toward those approaching retirement age, the Dow Jones Real Return Today index may be the appropriate benchmark as it maintains a fixed, conservative mix of assets indefinitely. The risk/reward tradeoff inherent in each of the different time horizons is already factored into the indexes.

The diagram below shows the mix of high- and low-risk index component assets over time. The investment/time horizon begins with more high risk assets and ends with more low risk assets.

The table below shows how subindexes are allocated
by risk at various stages throughout the investment/time horizon.

Years to Target Date	High-Risk Assets	Low-Risk Assets
40	90%	10%
35	87%	13%
30	81%	19%
25	72%	28%
20	60%	40%
15	48%	52%
10	39%	61%
5	33%	67%
0	30%	70%

Years to Target Date	High-Risk Assets	Low-Risk Assets
40	90%	10%
35	87%	13%
30	81%	19%
25	72%	28%
20	60%	40%
15	48%	52%
10	39%	61%
5	33%	67%
0	30%	70%

Years to Target Date	High-Risk Assets	Low-Risk Assets
40	90%	10%
35	87%	13%
30	81%	19%
25	72%	28%
20	60%	40%
15	48%	52%
10	39%	61%
5	33%	67%
0	30%	70%

Methodology Overview

COMPOSITION

Subindexes of the Dow Jones Real Return Target Date Indexes

REBALANCING: Adjusting for Risk

The table below shows how subindexes are allocatedby risk at various stages throughout the investment/time horizon.

The table below shows how subindexes are allocated
by risk at various stages throughout the investment/time horizon.

Years to Target Date	High-Risk Assets	Low-Risk Assets
40	90%	10%
35	87%	13%
30	81%	19%
25	72%	28%
20	60%	40%
15	48%	52%
10	39%	61%
5	33%	67%
0	30%	70%