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Alternative

2nd quarter 2014

Deutsche Asset & Wealth Management alternative asset allocation suiteAll-in-one exposure to alternative asset classes

2 Deutsche Asset & Wealth Management alternative asset allocation suite

Alternatives: a key piece in asset allocation

Building a portfolio of stocks, bonds and cash has long been recognized as a key element of successful investing.1 However, what has worked in the past might not be sufficient for today’s markets. So we believe that long-term investors should consider adding a diversified blend of alternatives, which has the potential to:— smooth performance compared to other alternative — enhance returns

asset classes over a variety of market cycles — improve portfolio efficiency— reduce volatility

We offer one-stop alternative accessWe break down the alternative universe into five broad categories, as shown below. And our two fund of funds, Deutsche Alternative Asset Allocation Fund and Deutsche Select Alternative Allocation Fund, offer diversified exposure to these asset classes by investing in a blend of mutual funds and exchange-traded funds.2

Three reasons to consider a fund of funds as the foundation for your alternative allocation — Active and professional management eliminate deciding which alternative asset classes to choose, how much to invest and when to rebalance.

— One-stop diversification allows easy access to a broad spectrum of alternative asset classes.3

— A simplified investment approach balances the risk and return of individual alternative asset classes and has the potential to generate a consistent return stream.

Alternative asset class Objective

Hedge fund Generate returns independent from the broad stock and bond markets

Real return Provide a measure of protection against inflation

Commodities Provide exposure to hard assets

Currency Offer exposure to foreign investments, many of which are not denominated in U.S. dollars

Opportunistic Provide exposure to asset classes generally not found in investors’ portfolios

1 The values of equity investments are more volatile than those of other securities. Fixed-income investments are subject to interest-rate risk, and their value will decline as interest rates rise. Alternative investments can be less liquid and more volatile than traditional investments and often lack longer-term track records.

2 An exchange-traded fund (ETF) is a security that tracks an index, a commodity or a basket of assets like an index fund, but trades like a stock on an exchange.

3 Diversification does not guarantee profits or protection against losses.

Deutsche Asset & Wealth Management alternative asset allocation suite 3

Because alternative asset-class performance varies from year to year, we recommend that investors consider using a blend of alternative investments to potentially smooth performance, enhance diversification and dampen volatility.

Using a blend of alternatives can potentially smooth performance

Source: Morningstar. Past performance is historical and does not guarantee future results. Equity index returns assume reinvestment of all distributions. Index returns do not reflect expenses or fees and it is not possible to invest directly in an index. The values of equity investments are more volatile than those of other securities. Fixed-income investments are subject to interest-rate risk, and their value will decline as interest rates rise. Alternative investments can be less liquid and more volatile than traditional investments and often lack longer-term track records. See page 7 for risk language, representations, definitions and information. This data is for illustrative purposes only and does not represent any Deutsche Asset & Wealth Management product.

Calendar-year returns (as of 12/31/13)

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

U.S stock calendar-year returns

10.88% 4.91% 15.79% 5.49% –37.00% 26.46% 15.06% 2.11% 16.00% 32.39%

U.S. bond calendar-year returns

4.34% 2.43% 4.33% 6.97% 5.24% 5.93% 6.54% 7.84% 4.21% –2.02%

Alternative asset-class calendar-year returns (as of 12/31/13)

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Global real estate

37.96%

Gold27.52%

Global real estate

42.35%

Infrastructure19.58%

Managed futures 18.33%

Global real estate

38.26%

Gold 34.22%

Infrastructure5.54%

Global real estate

28.65%

Infrastructure 19.51%


Commodities 21.36%


Gold17.71%

Currency –2.38%

Gold34.91%

Global real estate

20.40%

Merger arbitrage

4.10%

Alternatives11.31%

Long/short 14.62%

Alternatives16.07%

Global real estate

15.35%

Gold19.50%

Commodities 16.23%

Market neutral–3.41%

Alternatives28.23%

Commodities 16.83%

Alternatives2.74%

Infrastructure6.65%

Merger arbitrage

5.20%

Commodities 9.15%

Alternatives10.44%

Alternatives15.91%

Alternatives8.19%

Merger arbitrage –4.34%

Commodities 18.91%

Alternatives 13.77%

Long/short –2.81%

Long/short 5.15%

Global real estate 4.39%

Currency 8.59%

Infrastructure4.97%

Merger arbitrage 10.90%


Long/short –15.40%



Currency –3.33%

Marketneutral 4.51%

Market neutral 2.24%


Long/short 4.77%


Currency 5.50%

Gold –23.64%

Merger arbitrage 12.51%

Infrastructure6.60%

Managed futures –4.19%

Merger arbitrage

3.88%

Alternatives 1.34%

Long/short 5.06%

Merger arbitrage

4.73%

Long/short 7.23%

Long/short 4.42%

Alternatives–25.97%

Long/short 10.46%

Merger arbitrage

5.30%


Currency 3.34%


Merger arbitrage

3.29%

Marketneutral 2.31%


Merger arbitrage

3.61%

Infrastructure –32.66%

Marketneutral 0.48%

Long/short 4.13%

Global real estate

–5.82%

Commodities –1.06%

Currency –3.28%

Marketneutral3.18%


Currency 4.47%



Currency –1.73%

Currency –0.02%




Gold–6.22%

Currency –4.10%

Commodities 2.07%

Global real estate

–6.96%

Global real estate

–47.72%



Gold –17.93%

Gold –14.31%

Gold –53.02%


Asset-class volatility (10 years ending 6/30/14)

36.0%

21.4%18.0%

14.7% 13.3%11.6% 10.7% 9.4% 8.5% 3.4% 3.3% 3.1%

Alternative asset classes Traditional asset classes

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Consider alternatives to reduce volatility potential

Because minimizing volatility is crucial and plays a key part in building long-term wealth, we believe using a blended approach to alternative investing is a savvy strategy for many investors. Over the ten years ended 6/30/14, some individual asset classes demonstrated relatively high levels of volatility. However, combining alternative assets (as in “diversified alternatives”) helped lower volatility—that is, mitigate price movements—during that same time period.

Source: Morningstar. Volatility is measured by standard deviation, which is historical and may not have been as favorable over other time periods. It depicts how widely an investment’s returns vary from its average return over a certain period. The higher the standard deviation, the higher the volatility. This data is for illustrative purposes only and does not represent any Deutsche Asset & Wealth Management product. The values of equity investments are more volatile than those of other securities. Fixed-income investments are subject to interest-rate risk, and their value will decline as interest rates rise. Alternative investments can be less liquid and more volatile than traditional investments and often lack longer-term track records. See page 7 for risk language, representations, definitions and information.


As demonstrated on these pages, adding a blend of diversified alternatives to a traditional allocation of 60% U.S. stocks and 40% U.S. bonds can potentially provide the opportunity for a more efficient portfolio and help investors find the “sweet spot” between stocks and bonds.

Adding alternatives can potentially improve portfolio efficiency

Hypothetical portfolios (10 years ending 6/30/14)

0% 2% 4% 6% 16%8% 10% 12% 14%

0%

3%

6%

9%

12%

Volatility

Ret

urn

100% U.S. bonds3.25% volatility / 4.93% return

40% U.S. stocks, 35% U.S. bonds, 25% diversified alternatives

8.10% volatility / 7.02% return

60% U.S. stocks / 40% U.S. bonds 8.94% volatility / 6.93% return

100% U.S. stocks14.70% volatility / 7.78% return

Source: Morningstar. Past performance is historical and does not guarantee future results. Please visit www.deutschefunds.com for the most recent Deutsche Alterative Asset Allocation Fund performance. These portfolios are for illustrative purposes only, do not represent the performance of any Deutsche Asset & Wealth Management product and do not incorporate rebalancing. Hypothetical and equity index returns assume reinvestment of all distributions. Performance over other time periods might not have been as favorable. Index returns do not reflect expenses or fees, and it is not possible to invest directly in an index. The values of equity investments are more volatile than other securities. Fixed-income investments are subject to interest-rate risk, and their value will decline as interest rates rise. Alternative investments can be less liquid and more volatile than traditional investments and often lack longer-term track records. See the next page for standardized performance of the asset classes comprising the diversified alternatives blend. See page 7 for risk language, representations, definitions and information. One- and five-year returns as of 6/30/14: U.S. stocks (24.61%, 18.83%); U.S. bonds (4.37%, 4.85%).


When building Deutsche Alternative Asset Allocation Fund and Deutsche Select Alternative Allocation Fund, the portfolio managers follow a disciplined three-step process.

Investment process for the Deutsche Asset & Wealth Management alternative asset allocation suite

Key differences between the two funds

Deutsche Alternative Asset Allocation Fund

Deutsche Select Alternative Allocation Fund

Invests in Deutsche Asset & Wealth Management alternative products and exchange-traded funds

Yes Yes

Alternative risk profile Moderate Conservative

Benchmark 70% MSCI World Index 30% Barclays U.S.

Aggregate Index

60% MSCI World Index 40% Barclays U.S.

Aggregate Index

Inception date 7/30/07 9/30/08

Source: Deutsche Asset & Wealth Management. See page 7 for risk language, representations, definitions and information. Diversification does not guarantee protection against losses.

Portfolio implementation

Portfolio construction

Research andidea generation

— Identify alternative and non-traditional asset classes

— Review strategic asset allocations

— Use Deutsche Asset & Wealth Management’s global investment platform for market and asset-class views

— Determine asset allocation based on fundamental market views

— Evaluate portfolios regularly based on market conditions

— Allocate assets to ETFs and Deutsche Asset & Wealth Management mutual funds for comprehensive exposure

— Rebalance allocations monthly


Risk language Commodities, including gold and managed futures, are long-term investments and should be considered part of a diversified portfolio. Market-price movements, regulatory changes, economic changes, and adverse political or financial factors could have a significant impact on performance. Currency strategies are subject to the risk that changes in currency rates will affect performance. Investing in foreign securities, particularly those of emerging markets, presents certain risks, such as currency fluctuation, political and economic changes, and market risks. The GTAA strategy may use instruments including but not limited to futures, options and currency forwards. Derivatives may be more volatile and less liquid than traditional securities, and the strategy could suffer losses on its derivatives positions. Although inflation-indexed bonds are expected to be protected from long-term inflationary trends, short-term increases in inflation may lead to a decline in value. Infrastructure-related securities have greater exposure to market, economic, regulatory, political and other risks affecting such entities. Market neutral funds may outperform the market during periods of severe downturns, but they may also underperform the market during rallies. Merger arbitrage strategies are subject to the risk that the proposed reorganizations may be renegotiated or terminated, in which case the strategy may suffer a loss. There are special risks associated with an investment in real estate, including credit risk, interest-rate fluctuations and the impact of varied economic conditions. Short sales involve the risk that the strategy will incur a loss by subsequently buying a security at a higher price than the price at which the strategy previously sold the security short.

Index/category representations and definitions Alternatives (diversified blend): 15% Dow Jones Credit Suisse Hedge Fund Index (represents liquid, investable hedge funds); 15% JPMorgan Emerging Markets Bond Index Plus (tracks the performance of external debt instruments in the emerging markets); 15% Dow Jones Brookfield Global Infrastructure Composite Yield Index (tracks the highest-yielding companies of the Dow Jones Brookfield Global Infrastructure Composite Index); 15% Bloomberg Commodity Index (composed of futures contracts on physical commodities); 10% S&P/LSTA Leveraged Loan Index (tracks outstanding balance and current spread over LIBOR for fully funded loan terms); 15% Barclays U.S. TIPS Index (tracks the performance of U.S. Treasury-linked securities); 15% FTSE EPRA/NAREIT Developed Real Estate Index (see below). Cash is represented by the Citigroup 3-month U.S. T-Bill Index (tracks the performance of 3-month U.S. Treasury bills). Commodities are represented by the Bloomberg Commodity Index (see above). Currency is represented by the Morningstar Currency category (tracks the performance of portfolios that invest in multiple currencies through the use of short-term money market instruments, derivatives and cash deposits). Global infrastructure is represented by the MSCI World Infrastructure Sector Capped Index (tracks the performance of infrastructure stocks). Global real estate is represented by the FTSE EPRA/NAREIT Developed Real Estate Index (tracks the performance of developed-market REITs). Global stocks are represented by the MSCI World Index (tracks the performance of global equities). Gold is represented by the S&P Global Gold BMI Index (provides exposure to industries in the production of gold and related products). Long/short is represented by the Morningstar Long/Short category (tracks the performance of funds that hold sizable stakes in both long and short positions in equities and related derivatives). Managed futures are represented by the Dow Jones Credit Suisse Managed Futures Index (seeks to gain broad exposure to managed futures strategies). Market neutral is represented by the Morningstar Market Neutral category (attempts to reduce systematic risk created by factors such as exposure to sectors, market-cap ranges, investment styles currencies and/or countries). Merger arbitrage is represented by the Morningstar MSCI Merger Arbitrage category (tracks the performance of merger arbitrage strategies for investors who have hedged their currency exposure back into U.S. dollars). U.S. bonds are represented by the Barclays U.S. Aggregate Index (a proxy for the broad, U.S. investment-grade bond market). U.S. stocks are represented the S&P 500 Index (tracks the performance of 500 leading U.S. stocks and is widely considered representative of the U.S. equity market).

Important risk language, representations and definitions

Important risk informationAlthough allocation among different asset categories generally limits risk, portfolio management may favor an asset category that underperforms other assets or markets as a whole. The fund expects to invest in underlying funds that emphasize alternatives or non-traditional asset categories or investment strategies, and as a result, it is subject to the risk factors of those underlying funds. Some of those risks include stock market risk, credit and interest rate risk, volatility in commodity prices and high-yield debt securities, market direction risk (market advances when short, market declines when long), short sales risk and the political, general economic, liquidity and currency risks of foreign investments, which may be particularly significant for emerging markets. The fund may use derivatives, including as part of its currency and interest-rate strategies. Investing in derivatives entails special risks relating to liquidity, leverage and credit that may reduce returns and/or increase volatility. The success of the fund’s currency and interest-rate strategies are dependent, in part, on the effectiveness and implementation of portfolio management’s proprietary models. As part of these strategies, the fund’s exposure to foreign currencies could cause lower returns or even losses because foreign currency rates may fluctuate significantly over short periods of time for a number of reasons. The risk of loss is heightened during periods of rapid rises in interest rates. In addition, the notional amount of the fund’s aggregate currency and interest-rate exposure resulting from these strategies may significantly exceed the net assets of the fund. Because Exchange Traded Funds (ETFs) trade on a securities exchange, their shares may trade at a premium or discount to their net asset value. ETFs also incur fees and expenses so they may not fully match the performance of the indexes they are designed to track. See the prospectus for additional risks and specific details regarding the fund’s risk profile.

Obtain a prospectusTo obtain a summary prospectus, if available, or prospectus, download one from www.deutschefunds.com, talk to your financial representative or call (800) 728-3337. We advise you to carefully consider the products’ objectives, risks, charges and expenses before investing. The summary prospectus and prospectus contain this and other important information about the investment products. Please read the prospectus carefully before you invest.

Investment products: No bank guarantee | Not FDIC insured | May lose value

Investment products offered through DeAWM Distributors, Inc. Advisory services offered through Deutsche Investment Management Americas, Inc.

Deutsche Asset & Wealth Management represents the asset management and wealth management activities conducted by Deutsche Bank AG or any of its subsidiaries. Clients will be provided Deutsche Asset & Wealth Management products or services by one or more legal entities that will be identified to clients pursuant to the contracts, agreements, offering materials or other documentation relevant to such products or services.

DeAWM Distributors, Inc.222 South Riverside Plaza Chicago, IL 60606-5808www.deutschefunds.com [email protected] (800) 621-1148

© 2014 Deutsche Bank AG. All rights reserved. PM145664 (8/14) R-23186-10 ALT-600

Fund A C INST R S

Deutsche Alternative Asset Allocation Fund AAAAX AAAPX AAAZX AAAQX AAASX

Deutsche Select Alternative Allocation Fund SELAX SELEX SELIX SELRX SELSX

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