BIG IDEAS WEBINAR...AHL’s dynamic risk management is based on three distinct overlays. Proprietary risk management techniques are applied, depending on the type of risk Source: Man

BIG IDEAS WEBINARAre You Leaving Your Portfolio on Cruise Control?

May 20th, 2020

Securities offered through FSC Securities Corporation, Member FINRA/SIPC. Advisory and insurance services offered through Stavis & Cohen Financial, a Registered Investment Advisor not affiliated with FSC Securities Corporation. None of the entities mentioned are affiliated with FSC Securities Corporation. The views expressed are not necessarily the opinion of FSC Securities Corporation and should not be construed, directly or indirectly, as an offer to buy or sell and securities mentioned herein. Investing is subject to risks including loss of principal invested. No investment strategy, including diversification, asset allocation and re-balancing, can guarantee a profit or protect against loss. Although the information has been gathered from sources believed to be reliable, it cannot be guaranteed and the accuracy of the information should be independently verified. This material contains forward looking statements and projections. There are no guarantees that these results will be achieved. Past performance is no guarantee of future returns. Index performance does not reflect the deduction of any fees and expenses, and if deducted, performance would be reduced. Indexes are unmanaged and investors are not able to invest directly into any index. Past performance cannot guarantee future results. Investing involves risk including the potential loss of principal.

Host

Kyle McCullyChief Business Development OfficerStavis & Cohen Financial

AboutWe are a privately held, Houston-based wealth planning firm with the experience and culture to deliver a powerful combination of high tech and high touch planning to help multi-generational families manage the complexities of their wealth.

Featured Speaker

Jun GuPortfolio ManagerStavis & Cohen Financial

Guest Speaker

Adi MackicSenior Client Portfolio ManagerMan AHL

March 31, 2020

Institutional Wisdom, Earned Alpha, Enduring Value.

American Beacon AHL TargetRisk Fund

AgendaFirm Overview: American Beacon Advisors, Inc.

Sub-Advisor Overview: AHL Partners LLP (“Man AHL”)

Multi-Asset Investing

Investment Approach and Strategy

Summary

Appendix

Firm Overview:American Beacon Advisors, Inc.

americanbeaconfunds.com 9

New Corporate Structure

In April 2017, the parent company of American Beacon Advisors was rebranded asResolute Investment Managers.

As a multi-affiliate investment management company, Resolute wholly owns American Beacon and partners with boutique asset management firms through minority and majority ownership positions alongside the firms’ employee owners.

Sub-Advisor Overview:AHL Partners LLP (“Man AHL”)


Institutional Framework

1As of March 31, 2020.

Overview of Man — entrepreneurial asset management within an institutional framework

► A technology-empowered active investment management firm focused on delivering performance and client solutions

► Individual performance-driven investment businesses with centralized operations and services, providing a diverse range of strategies across investment approaches, styles and asset classes, managing around USD 104.2 billion¹

► Large institutional client base, including endowments, insurance companies and pension funds

► Headquarters in London, with offices in every major region

► Actively engaged industry leader and founding member of the Hedge Fund Standards Board

► Man GLG, founded in 1995 and acquired by Man Group in 2010, is a discretionary fund manager that is active across alternative and long-only strategies, equity and credit.

► Man FRM, founded in 1991 and acquired by Man Group in 2012, is a hedge fund investment specialist which draws on its technological capabilities in seeking to deliver enhanced investment solutions for clients.

► Man Numeric, established in 1989 and acquired by Man Group in 2014, is a Boston-based, quantitative equity manager invested in almost every equity market in the world.

► Man AHL is a diversified quantitative investment manager that has been a pioneer in the application of systematic trading since 1987.

► Man GPM focuses on assets within private markets. The firm will look to long duration assets to provide truly differentiated return streams not available on public markets for clients.


Advantage in Research

Oxford-Man Institute of Quantitative Finance

Man Research Laboratory► Co-located with the Oxford-Man Institute

► Combined purpose-designed working environment, but independent of OMI

► Commercial-driven research

► Staffed by permanent AHL researchers

Oxford-Man Institute of Quantitative Finance ► Vision to become the world’s leading academic research center for quantitative finance

► Founded in 2007, core funding provided by Man Group

► Multidisciplinary, independent of Man, run by the University of Oxford

Benefits► Recruitment opportunities and enhanced profile among distinguished scholars

► Close contact with the cutting edge research not yet in the public domain

► Access to specialists who can be contracted for confidential projects

► Man has right of first refusal over intellectual property created by the Institute

Source: Man Group database.

Multi-Asset Investing


Evolution From 60/40 Balanced Fund to a Dynamic Multi-Asset Portfolio

The difference between asset and risk exposure

Traditional 60/40 stock and bond portfolios are dominated by equity risk

60/40 portfolio asset exposure 60/40 portfolio risk exposure Balanced multi-asset portfolio risk exposure


Harvesting Diverse Asset Classes

Investing beyond stocks and bonds has the potential to increase returns and diversification

Source: Man Group database. Date range for all asset classes from January 1970 to December 2018. Asset classes shown are all part of the American Beacon AHL TargetRisk Fund, using representative indexes. Equity = MSCI World Net Total Return Index (hedged to USD); Bonds = Bloomberg Barclays Global Aggregate Bond Index (hedged to USD); Credit = Bloomberg Barclays Global Aggregate Credit Index (hedged to USD); Inflation = Bloomberg Barclays World Government Inflation-Linked Bond index (hedged to USD). Past performance is no indication of future results. Returns may increase or decrease as a result of currency fluctuations.

Equity Bonds Credit Inflation

Equity 1.00

Bonds 0.06 1.00

Credit 0.78 -0.33 1.00

Inflation 0.12 0.03 0.31 1.00

Positive risk adjusted returns in all assets… …and diversification helps

0.39

0.31

0.38

0.33

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

0.45

Equity Bonds Credit Inflation

Shar

pe ra

tio¹

Investment Approach and Strategy


Dynamic Risk Allocation

AHL TargetRisk Fund strategic approach to risk allocation

► Risk allocation approach as opposed to a allocating

► Seeks to capture positive returns in each asset category

► Diversification seeks to preserve capital and improve performance

► Balanced portfolio aims to perform positively in a range of market environments

► Additional risk management techniques may improve the overall performance by helping in challenging market environment


Investing Across Global Asset Classes

Equities:37.5% of risk

Credit:12.5% of risk

Bonds & rates:25.0% of risk

Inflation:25% of risk

Region:

U.S. / Canada 3 markets 2 markets 6 markets U.S. TIPS, 3 European

markets and diversified index exposure (ex Agriculturalsand Livestock)

Europe 8 markets 2 markets 6 markets

Japan 2 markets ─ 1 market

Asia ex-Japan 8 markets ─ 2 markets

Rest of World 2 markets ─ ─

Benefit From:

Inflationary growth

Non-inflationary growth

Recession

Global diversification has the potential to perform in many different types of market environments

As of December 31, 2019. Any descriptions or information involving investment process or strategies are provided for illustration purposes only. Source: Man Group database. Treasury Inflation-Protected Security (TIPS) are a type of Treasury security issued by the U.S. government that is indexed to inflation in order to protect investors from a decline in the purchasing power of their money. As inflation rises, TIPS adjust in price to maintain its real value.


40% of months

21% of months

17% of months

22% of months

-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%

-10% -5% 0% 5% 10%

Wor

ld e

quiti

es re

turn

s

World bond returns

Balanced Portfolios Are Not Immune to Downside Risk

World equities represented by MSCI World Net Total Return and World bonds represented by Barclay Capital Global Aggregate Bond index. Any descriptions or information involving investment process or strategies are provided for illustration purposes only, may not be fully indicative of any present or future investments, may be changed at the discretion of the investment manager and are not intended to reflect performance. There is no guarantee of trading performance and past performance is no indication of current or future performance/results. 1. Noureldin, D., Shephard, N., Sheppard, K. (2011): Multivariate High-Frequency-Based Volatility (HEAVY) Models, Journal of Applied Econometrics. Source: Bloomberg.

Monthly returns from January 2000 to June 2019

► A global balanced strategy has the potential to work in various environments:

– 40% both risk on and risk off markets rally

– 42% of the time, risk on and risk off act as hedging

► However, 18% of months the diversification breaks down

► Apply proprietary risk management techniques

– Volatility scaling/switching

– Momentum overlay

– Correlation overlay


Managing Volatility

AHL’s dynamic risk management is based on three distinct overlays.Proprietary risk management techniques are applied, depending on the type of risk

Source: Man Group, Contagion risk is caused by a period when both equity and bond prices fall at the same time. Any descriptions or information involving investment process or strategies is provided for illustration purposes only, may not be fully indicative of any present or future investments, may be changed and are not intended to reflect performance


Exposure

Source: Man Group database, Data as March 31, 2020. The period selected is exceptional and is not representative of typical performance. Any descriptions or information involving investmentprocess or strategies are provided for illustration purposes only, may not be fully indicative of any present or future investments, may be changed at the discretion of the investment manager and arenot intended to reflect performance. There is no guarantee of trading performance and past performance is no indication of current or future performance/results.

TargetRisk exposure changes

Correlation overlay reduces exposure, then

momentum and volatility

All three overlays

disengage, and the portfolio

re-gears

Correlation overlay reduces

exposure before sell-off

Reduced exposure

through volatility and momentum

overlays

0%

50%

100%

150%

200%

250%

300%

350%

400%

Gros

s Ex

posu

re

Bonds and Rates (LHS) Credit (LHS) Inflation (LHS) Stocks (LHS)

Reduced exposure


overlays

Reduced exposure


overlays


Managing Trading Costs

Explicit costs: These include the known costs when dealing in a given market, ranging from commissions to settlement costs, exchange fees and administration costs. These are expenses that are both known and quantifiable before a trade takes place; Implicit costs: These include expenses that investors are aware of before a trade, but are difficult to quantify pre-trade. These include, but are not limited, to: market impact, return decay and bid/offer spreads. For example, we know that every interaction with the market impacts the order book and, in turn, final execution prices. We do not, however, know how much the exact impact will be prior to making the trade, but we do a vast amount of work to understand and estimate it; Hidden costs: These may or may not be present with each trade and are extremely difficult to quantify in advance. Examples are the pre-trade impact of high frequency traders (‘HFTs’) or of any signal gaming that may occur. A large component of hidden costs is the way the other side is attempting to profit from the information contained in our trading. The AHL slippage yields above are the realized annual costs to the program during 2019 of electronically executed transactions. AHL executes a portion of its trades using broker algorithms for benchmarking purposes. The Best/Worst algorithm slippage numbers apply statistics derived from this portion of the flow to all electronically executed trades. A weighted average of equities and fixed income is used. Any descriptions or information involving investment process or strategies is provided for illustration purposes only, may not be fully indicative of any present or future investments, may be changed in the discretion of the investment manager and are not intended to reflect performance. Source: Man Database

The trade-offs between speed of portfolio adjustment and cost of execution are very important

Why execution matters: Total cost of accessing a market

► Commissions

► Settlement Costs

► Custodian Costs

► Administrator Costs

► Bid/offer spreads

► Timing

► Market impact

► Return decay

► HFT Interference

► Pre-trade impact

► Signal gaming

TRAD

ING

CO

STS

EXPLICIT

IMPLICIT

HIDDEN

18.2

27.0

43.4

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

50.0

Example of Man’s execution costsfor futures markets in 2019

ManInternal

Execution

BestBroker

Algorithm

WorstBroker

Algorithm

Performance and Characteristics


Fund Performance

Total Returns (%) Expense Ratio (%) Since(as of March 31, 2020) Gross Net QTR YTD 1 YR 3 YR 5 YR Incept.

2.04 1.05 -4.68 -4.68 8.13 — — 16.68

TargetRisk Composite Index — — -13.09 -13.09 -4.39 — — 2.83

Morningstar category: World Allocation — — -17.57 -17.57 -11.35 — — -4.13

The net expense ratio may reflect fees and expenses that American Beacon Advisors has contractually agreed to reduce and/or reimburse through April 30, 2020.

Morningstar RankingsMorningstar category: World Allocation

©2020 Morningstar, Inc. All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) Morningstar rankings are based on a fund's average annual total return relative to all funds in the same Morningstar category. Fund performance used within the rankings, reflects certain fee waivers, without which, returns and Morningstar rankings would have been lower. The highest (or most favorable) percentile rank is 1 and the lowest (or least favorable) percentile rank is 100 may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information.

10 YR

—

R5 Class (AHTIX)

Class inception: December 31, 2018. Periods more than one year have been annualized.

Performance shown is historical and is not indicative of future returns. Investment returns and principal value will vary, and shares may be worth more or less at redemption than at original purchase. Performance shown is as of date indicated, and current performance may be lower or higher than the performance data quoted. To obtain performance as of the most recent month end, please visit americanbeaconfunds.com or call 800.967.9009.

The TargetRisk Composite Index combines the returns of the MSCI World Index Hedged to U.S. Dollars (USD) and the Bloomberg Barclays Global-Aggregate Total Return Index Value Hedged USD in a 60%/40% proportion.

Total Return % Rank / # Funds in Category1 YR 3 YR 5 YR

1 / 466 — —

For additional information regarding the TargetRisk Composite Index and the Morningstar World Allocation category please refer to the disclosure located at the end of this presentation.

Summary


Summary

AHL’s core strength► AHL TargetRisk Strategy trades the same markets on the same

platform as AHL’s core strategies

► Applies systematic techniques with decades of experience

Risk Management► Volatility targeting. The strategy aims to deliver returns with a targeted

level of volatility, regardless of market conditions.

► Systematic risk overlays aim to mitigate the risks in traditional investing

Efficient execution► May benefit from investment and innovations in execution to drive

down costs

► Efficient execution helps to enable enhanced portfolio responsiveness

Applying AHL’s experience in systematic trading to a balanced multi-asset class portfolio

Appendix


DisclosuresSecurities of the Fund may only be sold by offering the Fund’s prospectus and summary prospectus. You should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. The prospectus and summary prospectus contain this and additional information regarding the Fund. To obtain a prospectus and summary prospectus, please contact your financial advisor, call 800.967.9009 or visit americanbeaconfunds.com. The prospectus and summary prospectus should be read carefully before investing.

Investing in derivative instruments involves liquidity, credit, interest rate and market risks. The use of quantitative models may lead to high levels of trading and concentration among certain investments, resulting in higher trading costs and return volatility. The Fund’s investments in high-yield or junk-rated securities are subject to greater levels of credit, interest rate, market and liquidity risks than investment-grade securities. In a period of sustained deflation, inflation index-linked securities may not pay any income and may suffer a loss. Investing in foreign and emerging market securities may involve heightened risk due to currency fluctuations and economic and political risks. Regulatory changes may impair the Fund’s ability to qualify for federal income tax treatment as a regulated investment company, which could result in the Fund and shareholders incurring significant income tax expense. The Fund may have high portfolio turnover risk, which could increase the Fund’s transaction costs and possibly have a negative impact on performance. Because the Fund may invest in fewer issuers than a more diversified portfolio, the fluctuating value of a single holding may have a greater effect on the value of the Fund. Please see the prospectus for a complete discussion of the Fund’s risks. There can be no assurances that the investment objectives of this Fund will be met.

Important Information: All investing involves risk, including the possible loss of principal. Indexes are unmanaged and one cannot invest directly in an index.

A portion of fees charged to each class of the Fund has been waived since Fund inception. Performance prior to waiving fees was lower than actual returns shown since inception.

This presentation promotes the American Beacon AHL TargetRisk Fund only. It is not meant to promote or offer any other security or investment management company cited in the presentation.

Any opinions herein, including forecasts, reflect our judgment as of the end of the reporting period and are subject to change. Each advisor’s strategies and each Fund’s portfolio composition will change depending on economic and market conditions. This report is not a complete analysis of market conditions and therefore, should not be relied upon as investment advice. Although information has been compiled from reliable sources, American Beacon Advisors, Inc. makes no representation as to the completeness or accuracy of the statements contained herein.

americanbeacofunds.com 02/20

AHL began managing a similar account using the strategy of the Fund (the "Similar Account") on December 12, 2014. The Similar Account has substantially similar investment objectives, policies and strategies in all material respects to the Fund. The performance information relates to the historical performance of the Similar Account, as measured against a composite index and the two broad-based market indices that comprise the composite index. The performance of the Similar Account does not represent the historical performance of the Fund and should not be considered indicative of future performance of the Fund, nor should it be considered a substitute for the Fund's performance. Results may differ because of, among other things, differences in brokerage commissions, account expenses, including management fees, the size of positions taken in relation to account size and diversification of securities, timing of purchases and sales, and availability of cash for new investments. In addition, the Similar Account is not a registered mutual fund and is not subject to the same types of expenses as the Fund, nor has it been subject to certain investment limitations, diversification requirements or other restrictions imposed by the Investment Company Act and the Internal Revenue Code which, if applicable, may have adversely affected the performance results of the Similar Account. Notwithstanding these differences, the Similar Account and the Fund are substantially similar from an investment perspective. The Similar Account is the only account managed by AHL with substantially similar investment objectives, policies and strategies in all material respects to the Fund.

The TargetRisk Composite Index combines the returns of the MSCI World Index Hedged to U.S. Dollars (USD) and the Bloomberg Barclays Global-Aggregate Total Return Index Value Hedged USD in a 60%/40% proportion.

DisclosuresThe MSCI World Index Hedged to USD represents a close estimation of the performance that can be achieved by hedging the currency exposures of its parent index, the MSCI World Index, to the USD, the “home” currency for the hedged index. The MSCI® information contained herein: (1) is provided ‘‘as is,’’ (2) is proprietary to MSCI and/or its content providers, (3) may not be used to create any financial instruments or products or any indexes and (4) may not be copied or distributed without MSCI’s express written consent. MSCI disclaims all warranties with respect to the information. Neither MSCI nor its content providers are responsible for any damages or losses arising from any use of this information.

The Morningstar World-allocation portfolios seek to provide both capital appreciation and income by investing in three major areas: stocks, bonds, and cash. While these portfolios do explore the whole world, most of them focus on the U.S., Canada, Japan, and the larger markets in Europe. It is rare for such portfolios to invest more than 10% of their assets in emerging markets. These portfolios typically have at least 10% of assets in bonds, less than 70% of assets in stocks, and at least 40% of assets in non-U.S. stocks or bonds.

The Bloomberg Barclays Global-Aggregate Total Return Index Value Hedged USD is a flagship measure of global investment-grade debt from 24 local currency markets and includes treasury, government-related, corporate and securitized fixed-rate bonds from both developed and emerging markets issuers.

American Beacon is a registered service mark of American Beacon Advisors, Inc. American Beacon AHL TargetRisk Fund is a service mark of American Beacon Advisors, Inc.

The American Beacon Funds are distributed by Resolute Investment Distributors, Inc.

Featured Speaker

Jun GuPortfolio ManagerStavis & Cohen Financial

Q&A

Thank you! 1330 Post Oak Boulevard, Suite 2190 Houston, TX 77056www.stavisandcohen.com(713) 275-7750

Securities offered through FSC Securities Corporation, Member FINRA/SIPC. Advisory and insurance services offered through Stavis & Cohen Financial, a Registered Investment Advisor not affiliated with FSC Securities Corporation. None of the entities mentioned are affiliated with FSC Securities Corporation. The views expressed are not necessarily the opinion of FSC Securities Corporation and should not be construed, directly or indirectly, as an offer to buy or sell and securities mentioned herein. Investing is subject to risks including loss of principal invested. No investment strategy, including diversification, asset allocation and re-balancing, can guarantee a profit or protect against loss. Although the information has been gathered from sources believed to be reliable, it cannot be guaranteed and the accuracy of the information should be independently verified. This material contains forward looking statements and projections. There are no guarantees that these results will be achieved. Past performance is no guarantee of future returns. Index performance does not reflect the deduction of any fees and expenses, and if deducted, performance would be reduced. Indexes are unmanaged and investors are not able to invest directly into any index. Past performance cannot guarantee future results. Investing involves risk including the potential loss of principal.

http://www.stavisandcohen.com/

Documents

BIG IDEAS WEBINAR...AHL’s dynamic risk management is based on three distinct overlays. Proprietary risk management techniques are applied, depending on the type of risk Source: Man