Spreading your risk across different asset classes

THE BASICS OF INVESTING:

DIVERSIFY YOUR PORTFOLIO

Spreading your risk across different asset classes

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THE BASICS OF INVESTING:

WHAT IS DIVERSIFICATION?

? Spreads risk among different asset classes

? May reduce overall portfolio volatility*

? Asset class performance varies

? Diversify...

- Across Asset Classes - Within Asset Classes

Non-Equities Equities

* Diversification is a technique to help reduce risk. There is no absolute guarantee that diversification will protect against a loss of income. Please keep in mind that there are risks associated with investing in securities including loss of principal.

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How time helps manage risk

Average ranges of return

The range of annual total returns for common stocks* (1926-2012)

60% 40% 20%

0% -20% -40% -60%

53.99%

9.84%

-43.34%

1 Year

28.55% 9.84% -12.47%

5 Years

20.06% 10.50% -1.38%

10 Years

Highest Annual Return Lowest Annual Return Average Return

Chart illustrates returns from 1/1/1926 ? 12/31/2012. Source: ? Ibbotson Associates, a wholly owned subsidiary of Morningstar, Inc. These returns are illustrative only and do not reflect TIAA-CREF performance; past performance isn't indicative of future results. Benchmark: Ibbotson Associates, Inc., S&P 500 Index. You cannot invest directly into an index.

How time helps manage risk

Average ranges of return

The range of annual total returns for corporate bonds (1926-2012)

60% 40% 20%

0% -20%

42.56%

6.06%

-8.09%

1 Year

22.51%

6.05%

-2.22%

5 Years

16.32%

6.00%

0.98%

10 Years

Highest Annual Return Lowest Annual Return Average Return

Chart illustrates returns from 1/1/1926 ? 12/31/2012. Source: ? Ibbotson Associates, a wholly owned subsidiary of Morningstar, Inc. These returns are illustrative only and do not reflect TIAA-CREF performance; past performance isn't indicative of future results. Benchmark: Ibbotson U.S. Long-Term Corporate Bonds. You cannot invest directly into an index.

THE BASICS OF INVESTING:

UNDERSTANDING ASSET CLASSES

? A group of investments that share common characteristics

? Risk may decrease as the number of asset classes increases

? Help manage risk by diversifying holdings among different asset classes

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