The asset allocation decision is, in many market environments, the foremost determinant of total portfolio return. We believe that tactical shifts among stocks, bonds, and money market instruments can enhance returns and lower risk over time. To achieve this goal, we use a combination of quantitative and qualitative tools to forecast a range of possible paths for the economy over the next twelve to eighteen months. We then estimate the likely performance of stocks and fixed income securities in each scenario, taking into consideration the current valuations of each asset class. An asset allocation policy is developed with the goal of producing attractive performance in the most favorable economic scenarios, while mitigating against a decline in portfolio values in the most adverse scenarios. Our policy is continuously reviewed using this same analytical approach.