GuideStone's MyDestination Funds offer dynamic asset allocation to help weather stock market ups and downs

July 26, 2007

DALLAS — The MyDestination Funds, launched earlier this year, provide participants with a dynamic asset allocation that keeps an investor’s portfolio mix in balance, an especially important feature considering the recent run-up in stock values. The funds, which are targeted to 10-year increments, allow investors to choose the fund closest to their retirement date and have a diversified portfolio in one fund.

With the stock market in record-breaking territory, it’s easy for retirement investors to question if they should move their money and how they should respond to a run-up. In an incredible trading run, over a three-month period, the Dow Jones Industrial Averages climbed nearly 1,000 points to end trading Thursday, July 19, above 14,000 for the first time in its history.

“The key whenever we see the market climb or drop is to keep in mind the long-term nature of investing for retirement,” said John Jones, chief operating officer for GuideStone Financial Resources. “Most financial experts assert that one’s investment time frame goes beyond retirement and should be tied to one’s life expectancy.”

“The MyDestination Funds take into account the number of years until a participant’s retirement date and keep the asset allocation in check through the years, becoming more conservative as the retirement date nears and beyond.”

There are twin dangers when the markets are growing, Jones explained. One danger is imbalanced investing when an investor’s normal asset allocation becomes skewed because either stocks or bonds outperform. The other danger is attempting to time the market. An investor who falls into this trap may sit on the sidelines, waiting for a decline, known as a correction, and miss out on market gains.

Markets move up and down in cycles. When stocks were outperforming bonds in the late Nineties, it was hard to believe that bonds would beat stocks in the early 2000s but that is exactly what happened. It is important to have an investment strategy geared toward the long-term. Investment decisions should never be made on the spur of the moment, or based on one day’s, or one month’s performance.

GuideStone Financial Resources makes available the MyDestination Funds through its controlled affiliate, GuideStone Funds. In these lifecycle, or date-target, funds, the allocation becomes more conservative as the investor approaches his target retirement date. It also maintains an appropriate stocks-to-bonds ratio based on the number of years until retirement and even beyond retirement. Investors should monitor their accounts periodically and make sure they are making appropriate contributions to keep pace with their retirement goals.

Investors who choose a do-it-yourself approach, as with GuideStone Funds Select Funds, should also look at their portfolios periodically. If market growth has caused the portfolio to be out of balance in its stocks-to-bonds ratio, then it might be necessary to make adjustments. GuideStone participants can sign up for the free automatic reallocation service through online services or by calling Customer Service at 1-888-984-8433 between 7 a.m. and 6 p.m. CST. With automatic reallocation, an investor’s allocation is rebalanced on a regular basis.

Even with the good news of recent market growth, it’s important to remember that the market is prone to react to negative news or major world events. Jones said in times of a market sell-off, as occurred in the days after the Sept. 11, 2001, terrorist attacks, the fundamentals of investing for the long-term still apply and it’s still important to keep long-term investing goals at the forefront of your decision-making in regards to retirement investing.

The MyDestination Funds attempt to achieve their objective by investing in the GuideStone Funds Select Funds. By investing in the MyDestination Funds, you will incur the expenses of the fund in addition to the expenses of the underlying funds. You may invest in the underlying funds directly except for the Global Bond Fund. The fund is subject to the risks of the underlying funds it holds.

You should carefully consider the investment objectives, risks, charges and expenses of GuideStone Funds before investing. For a copy of the prospectus with this and other information about the funds, please download a prospectus (pdf) or call 1-888-98-GUIDE (1-888-984-8433). You should read the prospectus carefully before investing.

GuideStone Funds shares are distributed by PFPC Distributors, Inc., a registered broker-dealer and underwriter of the funds, 760 Moore Road, King of Prussia, PA 19406.