ALLOCATION AGREEMENT

      AGREEMENT made as of this 1st day of April 2008, by and among Touchstone
Investment Trust, Touchstone Tax-Free Trust, Touchstone Strategic Trust,
Touchstone Variable Series Trust, Touchstone Funds Group Trust and Touchstone
Institutional Funds Trust (collectively, the "Funds"), all open-end investment
companies registered under the Investment Company Act of 1940.

      WHEREAS, pursuant to the requirements of Rule 17g-1 under the Investment
Company Act of 1940 ("Rule 17g-1"), the Funds are required to maintain a
fidelity bond against larceny and embezzlement, covering certain of their
officers and employees; and

      WHEREAS, Rule 17g-1 provides that where the shares of two or more
investment companies are distributed by the same person, such investment
companies may enter into a joint fidelity bond with each other (a "Joint Insured
Bond"); and

      WHEREAS, the Funds have entered into such a Joint Insured Bond with St.
Paul Fire and Marine Insurance Company in accordance with Rule 17g-1 (such Joint
Insured Bond as it is currently constituted and as it may be amended from time
to time being hereinafter referred to as the "Bond"); and

      WHEREAS, Rule 17g-1 provides that the amount of insurance coverage under a
Joint Insured Bond shall be at least equal to the sum of the total amount of
coverage which each party to such bond would have been required under Rule 17g-1
to provide and maintain individually; and

      WHEREAS, the Funds desire to provide for: (1) the method by which the
amount of coverage provided under the Bond will be determined from time to time
and (2) an equitable and proportionate allocation of any proceeds received under
the Bond in the event that two or more of the Funds suffer loss and consequently
are entitled to recover under the Bond;



      NOW THEREFORE, in consideration of the mutual covenants and agreements
herein set forth, the Funds agree as follows:

I.    Definitions

      A. Minimum Coverage Requirement - the minimum amount of insurance coverage
required to be maintained on a current basis by each of the Funds, such amount
being based upon their respective gross assets and being determined as of the
close of the most recent fiscal quarter in accordance with the table set forth
in paragraph (d) of Rule 17g-1 as it may from time to time be amended by the
Securities and Exchange Commission.

      B. Fidelity Coverage - the total amount of coverage provided under the
Bond.

      C. Actual Loss - the total amount of pecuniary loss suffered by a Fund
under circumstances covered by the terms of the Bond without regard to whether
the amount of Fidelity Coverage is sufficient to enable such Fund to recover the
total amount of such pecuniary loss.

      D. Excess Coverage - the amount by which the Fidelity Coverage exceeds the
amount of the combined Minimum Coverage Requirements of the Funds suffering
Actual Loss.

II.   The Amount of the Bond

      It shall be the intent of the Funds that the amount of the Fidelity
Coverage at all times shall be at least equal to the amount of the combined
Minimum Coverage Requirements of the Funds.

III.  Allocation of Recovery Under the Bond

      In the event Actual Loss is suffered by any two or more of the Funds, any
recovery under the Bond will be allocated among such Funds in the following
manner:

      a. If the Fidelity Coverage exceeds or is equal to the amount of the
combined Actual Losses of the Funds suffering Actual Loss, then each such Fund
shall be entitled to recover the amount of its Actual Loss.

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      b. If the amount of Actual Loss of each Fund suffering Actual Loss exceeds
its Minimum Coverage Requirement and the amount of the Funds' combined Actual
Losses exceeds the Fidelity Coverage, then each Fund shall be entitled to
recover (i) its Minimum Coverage Requirement, and (ii) to the extent there
exists Excess Coverage, the proportion of the Excess Coverage which its Minimum
Coverage Requirement bears to the amount of the combined Minimum Coverage
Requirements of the Funds suffering Actual Loss; provided, however, that if the
Actual Loss of any of such Funds is less than the sum of (i) and (ii) of this
subpart (b), then such difference shall be recoverable by the other Funds in
proportion to their relative Minimum Coverage Requirements.

      c. If (i) the amount of Actual Loss suffered by any Fund is less than or
equal to its Minimum Coverage Requirement, (ii) the amount of Actual Loss of the
other Funds exceeds its or their Minimum Coverage Requirement(s) and (iii) the
amount of the combined Actual Losses of the Funds exceeds the Fidelity Coverage,
then any Fund which has suffered an amount of Actual Loss less than or equal to
its Minimum Coverage Requirement shall be entitled to recover its Actual Loss.
If only one other Fund has suffered Actual Loss, it shall be entitled to recover
the amount of the Fidelity Coverage remaining. If more than one other Fund has
suffered Actual Loss in excess of the remaining coverage, they shall allocate
such remaining coverage in accordance with Section III(b) of this Agreement.

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      IN WITNESS WHEREOF, the Funds have executed this Agreement on the date
above mentioned.


TOUCHSTONE INVESTMENT TRUST                 TOUCHSTONE TAX-FREE TRUST


By:  /s/ William A. Dent                    By:  /s/ William A. Dent
     -------------------                         -------------------

TOUCHSTONE STRATEGIC TRUST                  TOUCHSTONE VARIABLE SERIES TRUST


By:  /s/ William A. Dent                    By:  /s/ William A. Dent
     -------------------                         -------------------

TOUCHSTONE FUNDS GROUP TRUST                TOUCHSTONE INSTITUTIONAL
                                            FUNDS TRUST

By:  /s/ William A. Dent                    By:  /s/ William A. Dent
     -------------------                         -------------------

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