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Home My WebLink About2010 01 26 Regular 601 Presentation From Bogdahn Group Date: January 26, 2010 The following Early Quarter Partial /Preliminary Report was distributed by Dave West from The Bogdahn Group during Regular Agenda Item "601" at the Board of Trustees Regular Meeting on January 26, 2010. City of Winter Springs General Employees Defined Benefit Plan and Trust WWW,BOI] ;DAIINC;ROUI "C OM Early Quarter Partial /Preliminary Report 4th Q uarter 2009 THE BORN up sirnpl fyingyvur ine�esrurerir acrd fiduciary decisions 4t" Quarter 2009 Market Environment THE BQGDAHN GROUP The Market Environment Major Market Index Performance Period Ended: December 31, 2009 Quarter Performance ■ Much like 2008, 2009 will not be a year that investors will soon forget. After opening the year with a continuation of 2008's risk aversion and negative performance, investors embraced equity and credit -based risk assets, which drove market returns higher at one of the most rapid paces in history. However, each of the chart's strong annual equity results are somewhat deceptive since many of the equity benchmarks were down in excess of -20% during the 4t" quarter of 2008. ■ Outside of the United States, emerging markets more than tripled the performance of developed markets during the quarter and was once again the strongest broad asset class in our summary. These results are even more pronounced on an annual basis with emerging markets posting an impressive +79.0% for the year. MSCI ACWxUS MSCI EAFE MSCI Emerg. Mkts. S &P 500 Russell 3000 Russell 1000 Russell MidCap Russell 2000 Barclays USAgg. Barclays US Gov. Barclays MBS Fixed Barclays Corp I 3mos. T -Bill MIM 8.6% 6.0% 5.9% 6.1% 5.9% 3.9% 0.2 -1.0 0.6 1.3 0.0% ■ Most of the core domestic equity indices posted similar results to the S &P 500's return of +6.0% for the quarter. Small cap issues, represented by the Russell 2000 index, returned a slightly lower +3.9% for the quarter. Over the one -year period, the Russell MidCap index posted the group's outsized performance relative to the various capitalization ranges with a return of +40.5 %. ■ The Barclays aggregate return of +0.2% for the quarter was dominated by the performance of credit issues ( +1.3 %) in the index as spreads continued to compress for most of the quarter. The government index's return of -1.0% was impacted by the yield curve's move during the quarter. For the trailing 1 -year period, the Barclays Aggregate posted a solid +5.9% return, which stands in contrast to the -2.2% return of the Government Index and the +18.7% return of the Investment Grade Credit index. Source: Barclays Capital, MSCI Capital Markets, Russell Investments 2 -5.0% 0.0% 5.0% 10.0% One Year Performance MSCI ACWxUS MSCI EAFE MSCI Emerg. Mkts. S &P 500 Russell 3000 Russell 1000 Russell MidCap Russell 2000 Barclays US Agg. Barclays US Gov. Barclays MBS Fixed Barclays Corp IG 3mos. T -Bill THE ` BOGDAHN GROUP -10.0% 10.0% 30.0% 50.0% 70.0% 90.0% The Market Environment Domestic Equity Style Index Performance Period Ended: December 31, 2009 Quarter Performance ■ A rally in two of the largest sectors of the growth benchmarks (information technology and health care) drove growth index performance to outpace value index results at all capitalization levels. The financial sector's negative performance, which represented a weight of more than 20% in each of the Russell value indices at the end of the quarter, was also a contributing factor to the underperformance of value relative to growth investments. ■ The differential between value and growth index results for the 4th quarter were broader at the large cap levels primarily due to a larger exposure to the strong performing information technology sector in the smaller capitalization value indices. While the range of style -based returns is much broader at all capitalization levels over the one year period, the causes are similar to the 4th quarter's results. Annual differentials were driven by the strong positive results in the information technology sector and the negative performance of the financial sector. ■ Style -based results over the one -year period were heavily impacted by the end -point sensitivity of the calculation. This sensitivity is quantified by the elimination of the 4th quarter of 2008's performance in the calculation, which fell by more than 20% for each style -based index, and the inclusion of the 4th quarter of 2009's results, which were positive for all of the indices. 3000 Value 30001ndex 3000 Growth 1000 Value 10001ndex 1000 Growth MidCap Value MidCapindex MidCap Growth 2000 Value 20001ndex 2000 Growth 3000 Value 30001ndex 3000 Growth 1000 Value 10001ndex 1000 Growth MidCap Value MidCapindex MidCap Growth 2000 Value 20001ndex 2000 Growth One Year Performance Source: Russell Investments ✓ THE 3 ` BOGDAHN \ GROUP 0.0% 5.0% 10.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% The Market Environment GICS Sector Performance & (Quarter -End Sector Weight) Period Ended: December 31, 2009 ■ Large cap stock performance was positive across the various Global Industry Classification Standard (GICS) sectors for the quarter with the exception of financial issues, which were mildly negative. While six of the index's ten sectors outpaced the +6.1 % return of the Russell 1000, performance was led by strong results in the information technology ( +10.8 %) and health care ( +8.7 %) sectors. ■ The financial sector of the Russell 1000, which was the strongest sector of the index during the 2nd and 3rd quarters of the year, posted the index's weakest performance during the 4th quarter with a return of -2.6 %. However, the strong results of the previous quarters are evident in the solid +16.7% return of the financial sector for the year. ■QTR 01 -Year Energy (11.3 %) Materials (4.0 %) Industrials (10.4 %) Consumer Disc (10.2 %) Consumer Staples (10.7 %) Health Care (12.5 %) Financials (14.4 %) Info Technology (19.4 %) Telecom Services (3.1 %) Utilities (4.0 %) Russell 1000 5.6 17.2% 8.1 52.5% 5.5 22.9% 8.3 45.1% 4.9% 15.5% 8.7 21.7% -2.6 16.7% 10.8% 62.0% 8.3% 12.4% 6.8% 12.9% -10.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% ■ Wlthln the Russell 1000 Index, each of the ten GICS sectors posted positive results for the year. The strongest ■QTR performance came from the information technology ( +62.0 %), o1 -Year materials ( +52.5 %) and consumer discretionary (+45.1%) sectors of the index. Energy (5.2%) Materials (4.8 %) • For the quarter, small cap stock performance was positive Industrials (15.8%) across all ten GICS sectors with the materials ( +10.3 %), consumer staples ( +7.7 %), and energy ( +7.1 %) sectors Consumer Disc (13.8%) providing the largest contribution. Six of the Russell 2000's Consumer Staples (3.5% economic sectors managed to outpace the 3.9% return of the core index for the 4th quarter. Health Care (14.3% Financials (20.3 %) • For the year, seven of the ten GICS sectors in the Russell Info Technology (18.3%) 2000 posted annual returns in excess of 20 %. In fact, three sectors posted returns in excess of 50 %. Only the financial Telecom Services (1.0% sector, which returned -1.5 %, posted a negative result for the Utilities (3.2% year Russell 2000 7.1% 41.0% 10.3% 60.9% 3.7% 13.9% 4.1% 60.8% 7.7% 23.8% 2.7% 22.6% 1.8% 3.4% 59.9% 5.8% 23.9 7.0 � 7.9% -10.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% Source: Thompson Financial THE ✓ 4 BOGDAHN ` \ GROUP The Market Environment Quality Rankings* Breakdown by Weight and Quarterly Performance Period Ended: December 31, 2009 ■ Within the Russell 1000 index, the performance of each of the quality segments, with the exception of those classified as "not available ", were spread over a relatively narrow spectrum during the 4th quarter. Of the companies that received a rating, "B" rated stocks turned in the strongest performance with a return of +7.2 %, while "13 rated stocks returned a weaker but still solid +4.7% for the quarter. ■ With nearly 30% of the small cap Russell 2000 index being classified as "not rated ", drawing sweeping quality conclusions from the data can be more problematic. However, for the issues with a weight in excess of 1 % in the breakdown, there appears to be a clear advantage to quality in smaller cap issues with the "A +" and "A" rated segments of the index leading performance for the quarter. Russell 000 Quality Breakdown A+ Average Weight 10.6% QTR Return 5.5% A 10.7% 7.0% A- 14.1% 4.8% B+ 16.9% 6.5% B 5.9% 7.2% B- 28.1% 4.7% c 2.1% 6.5% D 0.0% 0.0% Not Rated 10.8% 8.8% N/A Russell 000 Index 0.8% 100.0% 14.2% Russell 000 Quality Breakdown A+ Average Weight 3.1% QTR Return 6.2% A 5.0% 4.6% A- 0.7% -0.2% B+ 17.3% 4.6% B 20.4% 2.5% B- 12.2% 4.3% c 11.2% 1.1% D 0.2% 16.6% Not Rated 29.3% 4.8% N/A Russell iii Index 0.6% 100.0% 10.0% Quality Rankings Table Highest I High I Above Average I Average I Below Average I Lower I Lowest I In Reorganization 'Standard and Poor's rankings are generated by a computerized system and are based on per -share earnings and dividend records of the most recent 10 years. - October 2005 report Source: Thompson Financial THE ✓ 5 BOGDAHN ` \ GROUP The Market Environment International and Regional Market Index Performance (# Countries) Period Ended: December 31, 2009 ■ For the first time since the equity markets turned positive back in March, international developed markets ( +2.2 %) lagged the performance of domestic equity markets across the capitalization spectrum. Another phenomenon visible in the performance of international developed markets during the 4t" quarter is the strength of the U.S. dollar (USD). Both the Europe and Pacific regions of the MSCI -EAFE index show stronger results in local currency vs. USD. ■ Emerging Markets continued its strong performance during the 4t" quarter with a return of +8.6 %. Unlike the developed markets, which were impacted by USD strength, the currency effect on the performance of the emerging markets index continued to be positive. This USD depreciation is visible in the 4t" quarter performance of each of the emerging market country segments. ■ Over the trailing one -year period, the USD's broad deprecation against various foreign currencies is evident. This USD deprecation had a positive impact for U.S. investors on un- hedged international returns. ■ In contrast to the domestic indices which were driven by information technology and health care results, the GICS sector attribution of both the EAFE and ACWIxUS indices illustrates the largest strength coming from exposure to materials and consumer staples issues. While financial sector weakness was evident in both indices ( -4.5% & - 1.8 %), the information technology and utilities sectors also posted negative results in the EAFE index. Source: MSCI Capital Markets 6 ■QTR (USD) QTR (Local) AC World US (44) WORLD x US (22) EAFE (2 1) Europe (16) Pacific (5) Emerging Mkt (22) EM Europe (5) EM Asia (8) EM Latin Amer (7) ■1 -Year (USD) ❑ 1 -Year (Local) AC World x US (44) WORLD x US (22) EAFE (21) Europe (16) Pacific (5) Emerging Mkt (22) EM Europe (5) EM Asia (8) EM Latin Amer (7) Quarter Performance M3.8% 4.1 2 5% 3.3% 2.2% 3.4% NL % 4.0 a1% 2.1% 4.2% 6.6% 6.8% 4.5% 2.3 0.0% 5.0% 8.6% . 9.3% 12.5% 10.0% 15.0% One -Year Performance 42.1 % 32. 34.4% 26.0% 32. 4 6.8 9 % 79.0% 62.8% 86.2 73.6 74.2 68.1 104.2% 63.2 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 120.0% THE ` BOGDAHN GROUP The Market Environment U.S. Dollar International Index Attribution & Country Detail Period Ended: December 31, 2009 Source: MSCI Capital Markets, & Franklin/Templeton Country United Kingdom Ending Weight 21.6% Ending Weight 15.2% Return 7.0% Energy 8.4% 7.0% 34.9% Materials 10.4% 13.2% 70.0% Industrials 11.2% 1.5% 31.8% Consumer Discretionary 9.7% 2.9% 38.0% Consumer Staples 10.1% 8.1% 32.2% Health Care 8.4% 5.4% 18.3% Financials 25.5% -4.5% 38.7% Information Technology 4.8% -2.6% 21.9% Telecommunication Services 5.8% 1.6% 16.6% Utilities Total 5.9% 11 1' -0.3% 5.3% 43.0% Sweden 2.5% 1.8% Source: MSCI Capital Markets, & Franklin/Templeton Country United Kingdom Ending Weight 21.6% Ending Weight 15.2% Return 7.0% Energy 11.2% 7.3% 51.2% Materials 12.0% 12.7% 76.5% Industrials 9.8% 2.4% 36.0% Consumer Discretionary 8.4% 4.4% 45.9% Consumer Staples 8.5% 9.2% 36.3% Health Care 6.4% 6.0% 19.8% Financials 25.8% -1.8% 48.6% Information Technology 6.7% 2.7% 51.7% Telecommunication Services 6.2% 1.9% 19.8% Utilities Total 1 5.0% 100.0% 1 0.9% 1 11.2% 43.0% Sweden 2.5% 1.8% Source: MSCI Capital Markets, & Franklin/Templeton Country United Kingdom Ending Weight 21.6% Ending Weight 15.2% Return 7.0% Return 43.4% Japan 20.7% 14.5% -2.8% 6.4% France 11.1% 7.8% 2.2% 33.3% Australia 8.4% 5.9% 5.0% 76.8% Germany 8.1% 5.7% 2.2% 26.6% Switzerland 7.7% 5.4% 3.8% 26.6% Spain 4.6% 3.2% 1.6% 45.1% Italy 3.5% 2.4% -2.6% 28.0% Netherlands 2.7% 1.9% 3.8% 43.0% Sweden 2.5% 1.8% 3.6% 65.9% Hong Kong 2.3% 1.6% 3.6% 60.2% Singapore 1.5% 1.0% 9.8% 74.0% Finland 1.1% 0.8% -3.5% 12.7% Belgium 1.0% 0.7% 1.6% 58.6% Denmark 0.9% 0.6% -2.8% 37.1% Norway 0.8% 0.6% 14.9% 88.6% Greece 0.5% 0.4% - 22.4% 25.3% Austria 0.3% 0.2% -9.8% 44.8% Portugal 0.3% 0.2% 0.5% 1 41.7% Ireland 0.3% 0.2% -2.7% 12.9% New Zealand 0.1% 0.1% 0.1% 51.7% Canada 11 1' 1 7.3% 5.2% 57.4% China 4.0% 9.6% 62.6% Brazil 3.8% 13.1% 128.6% Korea 2.8% 2.3% 72.1% Taiwan 2.5% 8.1% 80.3% India 1.7% 7.7% 102.8% South Africa 1.5% 9.4% 57.8% Russia 1.4% 10.5% 104.9% Mexico 1.0% 13.7% 56.6% Israel 0.6% 14.1% 54.6% Malaysia 0.6% 6.7% 52.1% Indonesia 0.4% 5.2% 127.6% Turkey 0.3% 9.2% 98.5% Chile 0.3% 15.4% 86.7% Thailand 0.3% 1.1% 77.3% Poland 0.3% 12.9% 42.5% Colombia 0.1% -1.1% 84.4% Peru 0.1% 0.8% 72.1% Hungary 0.1% 3.5% 77.6% Egypt 0.1% -6.2% 39.7% Philippines 0.1% 1 9.8% 1 68.0% Czech Republic 0.1% -6.9% 27.8% Morocco Total Emerging Countries Total ACWIxUS Countries 0.0% 22.4% 100.0% -7.1% 8.6% 5.0 % 1' THE BQGDAHN GROUP The Market Environment Domestic Credit Sector & Broad Market Maturity Performance Period Ended: December 31, 2009 Quarter Performance I ■ Although the equity quality performance distribution showed a much more narrow range than in previous quarters, a move down the quality ladder in fixed income assets continued to reward investors willing to take on lower quality debt. In addition to the "quality- play" that is evident in the performance numbers of the various credit indices, the longer -dated broad index suffered relative to the shorter -term broad indices as a result of a steepening curve. This yield curve movement is particularly evident in the results of the chart's government benchmark, which recorded a -1.1 % return for the quarter. ■ For the quarter, high yield issues once again produced the strongest results with a return of +6.0 %. Results in investment grade segment of the credit market (BBB to AAA) step down dramatically from high yield results. These investment grade results range from +2.2% for BBB issues down to -0.8% for AAA issues. Outside of government and credit issues, the chart's mortgage- backed benchmark posted a mild but positive return of +0.5 %. ■ Each of the themes that are described in the paragraphs above for 4t" quarter are also evident, and much more dramatic, over the one -year period. This disparity is best illustrated in the more than 60% performance differential between the year's high yield return of +57.5% and the government return of -2.6 %. AAA AA A BBB <BBB Govt Mort 1 -3yr G /M /C 1 -5yr G /M /C 1 -10yr G /M /C 10 +yrG /M /C -0.s% 0.6% 0.7% 2.2% 6.0% -1.1% 0.5% G /M /C = Broad Market (Government + Mortgage + Corporate) 0.6% 0.5% 0.4% -2.6% 5.0% 5.0% 10.0% 0.0% one Year Performance AAA -0.7% AA 9.1 % A 15.9% BBB L31 <BBB Govt -2.6% Mort 5.8%. 1 -3yr G /M /C 1- 5yrG /M /C 1 -10yr G /M /C 10 +yrG /M /C -10.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 5.1% 5.4% 5.8% 1.8% .5% �� THE Source: Merrill Lynch Index System 8 ` OGDAHN GROUP The Market Environment Market Rate & Yield Curve Comparison Period Ended: December 31, 2009 ■ During the quarter, the Fed kept the target for the Fed funds rate unchanged at 0 -25 basis points, despite calls by many market observers to systematically remove the stimulative effects of such a low interest rate policy. The Fed continued to state in its press release that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels of the federal funds rate for an extended period. ■ The various indicators reported in the 2009 Market Rates charts continue to show improving credit conditions and more stable inflation expectations than were evident earlier in the year. ■ Reversing its move during the 3rd quarter, the Treasury yield curve increased at maturities beyond two years during 4t" quarter to their highest level of 2009. This steepening is particularly visible at the long end of the curve where rates spiked by 60 basis points during the quarter. ■ The benchmark 10 -year Treasury finished the quarter with a yield of 3.85 %. This yield represented an increase of 54 basis points from the yield at the end of the 3rd quarter (3.31 %) and a 160 basis point increase from the yield at the end of 2008 (2.25 %). Source: Mortgage -X.com , US Department of Treasury & St. Louis Fed 6.00 5.00 4.00 3.00 2.00 1.00 0.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 n nn Dec -08 Mar -09 Jun -09 Sep -09 Dec -09 Treasury Yield Curve 112/31/2008 ■ 6/30/2009 19/30/2009 X12/31/2009 0 1 mo 3 mo 6 mo 1 yr 2 yr 3 yr 5 yr 7 yr 10 yr 20 yr 30 yr r� THE 9 t BQGDAHN GROUP 2009 Market Rates The Market Environment Decades in Review Period Ended: December 31, 2009 ■ Despite some exciting years along the way, the decade that ended December 31, 2009 represented the weakest calendar decade on record for stocks back to the 1930's. In contrast to the returns on stocks, both bond and cash results for the 2000's were consist with long -term averages. 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% -5.0% -10.0% 25.00 20.00 15.00 10.00 5.00 0.00 -5.00 -1000 Returns by Decade ■ The rolling decade chart presents a similar visual story as the "Returns by Decade" chart. However, by moving the inception period back to 1926 and rolling the 10 -year periods forward by month, some mid 1930's 10 -year returns were lower than those recorded during the 2000's decade. Source: /bbotson & Zephyr Associates e a � � e N e N r e e N ' e O O OD c p M T M e O � e Oi O ■Stocks ■Bonds ■Cash L 1930's 1940's 1950's 1960's 1970's 1980's 1990's 2000's Average Rolling 10 -Year Returns — Equity —Bonds —Cash Dec -35 Mar -45 Jun -54 Sep -63 Dec -72 Mar -82 Jun -91 Sep -00 Dec -09 r� THE 10 t BQGDAHN GROUP This Page is Intentionally Left Blank THE 11 BQGDAHN GROUP Defined Benefit Plan & Trust for Employees of the City of Winter Springs December 31, 2009 September 30, 2009 : $17,327,600 December 31, 2009 : $18,269,494 Segments Market Value Allocation Segments Market Value Allocation ■ Domestic Equity 7,849,480 45.3 ■ Domestic Equity 8,323,521 45.6 ❑ International Equity 2,318,143 13.4 ❑ International Equity 2,431,014 13.3 ❑ Fixed Income 6,163,134 35.6 ❑ Fixed Income 6,218,135 34.0 ■ Real Estate 639,006 3.7 ■ Real Estate 605,618 3.3 ■ Cash Equivalent 357,836 2.1 ■ Cash Equivalent 691,205 3.8 12 THE BOGDAHN ` GROUP Defined Benefit Plan & Trust for Employees of the City of Winter Springs December 31, 2009 September 30, 2009 : $17,327,600 ■ Galliard Core Fixed Income ■ Lateef Asset Mgmt.Equity ■ Dalton, Greiner, Hartman, Maher & Co ■ RBC Global (Voyageur) ■ Galliard TIPS ❑ American Stable Value Fund ❑ Receipt & Disbursement December 31, 2009 : $18,269,494 Market Value Allocation Market Value Allocation 5,089,040 29.4 ■ Galliard Core Fixed Income 5,123,295 28.0 4,480,407 25.9 ■ Lateef Asset Mgmt.Equity 4,854,033 26.6 3,596,107 20.8 ■ Dalton, Greiner, Hartman, Maher & Co. 3,971,638 21.7 2,318,143 13.4 ■ RBC Global (Voyageur) 2,431,014 13.3 1,116,517 6.4 ■ Galliard TIPS 1,141,913 6.3 639,006 3.7 ❑ American Stable Value Fund 610,372 3.3 88,380 0.5 ❑ Receipt & Disbursement 137,228 0.8 13 THE BOGDAHN ` GROUP Defined Benefit Plan & Trust for Employees of the City of Winter Springs Asset Allocation As of December 31, 2009 Asset Allocation History by Portfolio Domestic Equity Portfolio Snow Capital Mgmt. Equity Dalton, Greiner, Hartman, Maher & Co. Lateef Asset Mgmt.Equity International Equity Portfolio RBC Global (Voyageur) Total Fixed Portfolio Galliard Core Fixed Income Galliard TIPS American Stable Value Fund Receipt & Disbursement Total Fund Portfolio 8,825,671 48.31 3,971,638 21.74 4,854,033 26.57 2,431,014 13.31 2,431,014 13.31 6,265,208 34.29 5,123,295 28.04 1,141,913 6.25 610,372 3.34 137,228 0.75 18,269,494 100.00 8,076,514 46.61 3,596,107 20.75 4,480,407 25.86 2,318,143 13.38 2,318,143 13.38 6,205,557 35.81 5,089,040 29.37 1,116,517 6.44 639,006 3.69 88,380 0.51 17,327,600 100.00 6,767,374 44.28 2,985,975 19.54 3,781,399 24.74 1,762,078 11.53 1,762,078 11.53 5,893,704 38.56 4,813,261 31.49 1,080,442 7.07 714,964 4.68 146,556 0.96 15,284,676 100.00 5,528,248 41.38 2,336,270 17.49 3,191,977 23.90 1,277,678 9.56 1,277,678 9.56 5,532,936 41.42 4,481,961 33.55 1,050,975 7.87 785,600 5.88 233,801 1.75 13,358,262 100.00 5,822,074 42.72 2,519,390 18.49 3,302,683 24.24 1,353,407 9.93 1,353,407 9.93 5,296,491 38.87 4,304,428 31.59 992,062 7.28 904,042 6.63 251,710 1.85 13,627,723 100.00 Historical Asset Allocation By 100.E 80. 0 60. 0 0 U 40. d 20. 0. 9/09 Domestic Equity International Equity 10/09 0 Fixed Income 11/09 1 Real Estate 12/09 Cash Equivalent 14 THE BOGDAHN ` GROUP Defined Benefit Plan & Trust for Employees of the City of Winter Springs Financial Reconciliation As of December 31, 2009 Financial Reconciliation Ouarter to Date Domestic Equity Portfolio 8,076,514 239,400 - - - 17,941 -981 31,854 496,825 8,825,671 Lateef Asset Mgmt.Equity 4,480,407 119,700 - - 11,199 -537 13,757 251,905 4,854,033 Dalton, Greiner, Hartman, Maher & Co. 3,596,107 119,700 - -6,742 -443 18,097 244,920 3,971,638 International Equity Portfolio 2,318,143 80,774 - - -5,174 -413 4,902 32,782 2,431,014 RBC Global (Voyageur) 2,318,143 80,774 - - -5,174 -413 4,902 32,782 2,431,014 Total Fixed Portfolio 6,205,557 209 - - -3,599 -766 4,771 59,037 6,265,208 Galliard Core Fixed Income 5,089,040 209 - - -3,181 -630 - 37,857 5,123,295 Galliard TIPS 1,116,517 - - - -419 -136 4,771 21,180 1,141,913 American Stable Value Fund 639,006 - - - -1,636 - 9,356 - 36,355 610,372 Receipt & Disbursement 88,380 - 320,383 551,430 - 177,335 - -4,867 3 - 137,228 Total Fund Portfolio 17,327,600 - 551,430 - 177,335 - 28,350 -7,026 50,886 552,290 18,269,494 Financial Reconciliation Fiscal Year to Date Domestic Equity Portfolio 8,076,514 239,400 - - - 17,941 -981 31,854 496,825 8,825,671 Lateef Asset Mgmt.Equity 4,480,407 119,700 - - 11,199 -537 13,757 251,905 4,854,033 Dalton, Greiner, Hartman, Maher & Co. 3,596,107 119,700 - -6,742 -443 18,097 244,920 3,971,638 International Equity Portfolio 2,318,143 80,774 - - -5,174 -413 4,902 32,782 2,431,014 RBC Global (Voyageur) 2,318,143 80,774 - - -5,174 -413 4,902 32,782 2,431,014 Total Fixed Portfolio 6,205,557 209 - - -3,599 -766 4,771 59,037 6,265,208 Galliard Core Fixed Income 5,089,040 209 - - -3,181 -630 - 37,857 5,123,295 Galliard TIPS 1,116,517 - - - -419 -136 4,771 21,180 1,141,913 American Stable Value Fund 639,006 - - - -1,636 - 9,356 - 36,355 610,372 Receipt & Disbursement 88,380 - 320,383 551,430 - 177,335 - -4,867 3 - 137,228 Total Fund Portfolio 17,327,600 - 551,430 - 177,335 - 28,350 -7,026 50,886 552,290 18,269,494 15 THE BOGDAHN ` GROUP Defined Benefit Plan & Trust for Employees of the City of Winter Springs Comparative Performance Trailing Returns Trailing Returns As of December 31, 2009 otal Fund (Excl RE) (Net) 3.57 25.76 3.57 25.76 -5.13 -1.67 1.26 2.97 11/01/2000 otal Fund Policy (Excl RE) 3.71 18.50 3.71 18.50 -3.96 -0.68 2.44 2.19 , ifference -0.14 7.26 -0.14 7.26 -1.17 -0.99 -1.18 0.78 otal Fund (New Mgrs)(Excl RE) (Net) 3.57 25.76 3.57 25.76 -5.13 N/A N/A -5.52 10/01/2007 otal Fund Policy (Excl RE) 3.71 18.50 3.71 18.50 -3.96 -0.68 2.44 -3.89 , ifference -0.14 7.26 -0.14 7.26 -1.17 N/A N/A -1.63 otal Fund (Excl RE) (Gross) 3.74 26.53 3.74 26.53 -4.50 -1.04 1.92 3.67 11/01/2000 otal Fund Policy (Excl RE) 3.71 18.50 3.71 18.50 -3.96 -0.68 2.44 2.19 , ifference 0.03 8.03 0.03 8.03 -0.54 -0.36 -0.52 1.48 otal Fund (New Mgrs)(Excl RE) (Gross) 3.74 26.53 3.74 26.53 -4.50 N/A N/A -4.97 10/01/2007 otal Fund Policy (Excl RE) 3.71 18.50 3.71 18.50 -3.96 -0.68 2.44 -3.89 lifference 0.03 8.03 0.03 8.03 -0.54 N/A N/A -1.08 Returns for periods greater than one year are annualized. Returns are expressed as percentages. 10/1/2007 inception date represents the date new managers were �� THE hired. Total Fund Policy represents new policy beginning 10/1/2009. Old policy geometrically linked to new policy. See benchmark history for details. Total Fund D OGDAHN excludes real estate and Total Fund Policy excludes NCREIF after 10/1/2008 16 B GROUP Defined Benefit Plan & Trust for Employees of the City of Winter Springs Comparative Performance Trailing Returns Trailing Returns As of December 31, 2009 otal Equity Portfolio 5.34 37.45 5.34 37.45 -9.87 -4.84 -0.30 2.12 01/01/2001 otal Equity Policy 5.06 25.29 5.06 25.29 -11.15 -5.92 -0.60 0.41 Difference 0.28 12.16 0.28 12.16 1.28 1.08 0.30 1.71 , omestic Equity Portfolio 6.43 33.67 6.43 33.67 -9.18 -3.92 -0.06 1.80 11/01/2000 otal Domestic Equity Policy 5.90 26.30 5.90 26.30 -10.80 -5.67 -0.71 -0.85 ifference 0.53 7.37 0.53 7.37 1.62 1.75 0.65 2.65 iternational Equity Portfolio 1.54 53.51 1.54 53.51 -12.57 -8.57 -0.69 3.25 11/01/2000 1SCI EAFE Index 2.22 32.46 2.22 32.46 -13.15 -5.57 1.66 3.37 ifference -0.68 21.05 -0.68 21.05 0.58 -3.00 -2.35 -0.12 otal Fixed Portfolio 1.03 13.02 1.03 13.02 4.44 5.33 4.87 5.83 11/01/2000 otal Fixed Policy 0.53 6.46 0.53 6.46 5.66 6.11 5.64 6.06 ifference 0.50 6.56 0.50 6.56 -1.22 -0.78 -0.77 -0.23 Returns for periods greater than one year are annualized. Returns are expressed as percentages. 10/1/2007 inception date represents the date new managers were �� THE hired. Total Fund Policy represents new policy beginning 10/1/2009. Old policy geometrically linked to new policy. See benchmark history for details. Total Fund D OGDAHN excludes real estate and Total Fund Policy excludes NCREIF after 10/1/2008 17 B GROUP Defined Benefit Plan & Trust for Employees of the City of Winter Springs Comparative Performance Trailing Returns Trailing Returns As of December 31, 2009 Dalton, Greiner, Hartman, Maher & Co. 7.17 N/A 7.17 N/A N/A N/A N/A 33.26 05/01/2009 Russell 3000 Value Index 4.17 19.76 4.17 19.76 -12.62 -8.91 -1.94 29.84 Difference 3.00 N/A 3.00 N/A N/A N/A N/A 3.42 Lateef Asset Mgmt.Equity 5.83 31.88 5.83 31.88 -5.86 N/A N/A -4.44 10/01/2007 ' 1000 Growth Index 7.94 37.21 7.94 37.21 -8.09 -1.89 0.75 -7.54 Dill'erence -2.11 -5.33 -2.11 -5.33 2.23 N/A N/A 3.10 RBC Global (Voyageur) 1.54 53.51 1.54 53.51 -12.57 N/A N/A N/A 10/01/2007 MSCI EAFE Index 2.22 32.46 2.22 32.46 -13.15 -5.57 1.66 -12.45 Difference -0.68 21.05 -0.68 21.05 0.58 N/A N/A N/A Galliard Core Fixed Income 0.74 13.69 0.74 13.69 4.43 N/A N/A 4.76 10/01/2007 Barclays Capital Intermediate Aggregate 0.53 6.46 0.53 6.46 5.66 6.11 5.72 6.35 Difference 0.21 7.23 0.21 7.23 -1.23 N/A N/A -1.59 Galliard TIPS 2.32 10.12 2.32 10.12 4.50 N/A N/A 6.24 10/01/2007 Barclays Capital TIPS 1.76 11.41 1.76 11.41 4.30 6.69 5.11 6.08 Difference 0.56 -1.29 0.56 -1.29 0.20 N/A N/A 0.16 American Stable Value Fund -4.23 -30.00 -4.23 -30.00 -18.31 N/A N/A -15.87 10/01/2007 Returns for periods greater than one year are annualized. Returns are expressed as percentages. 10/1/2007 inception date represents the date new managers were �� THE hired. Total Fund Policy represents new policy beginning 10/1/2009. Old policy geometrically linked to new policy. See benchmark history for details. Total Fund D OGDAHN excludes real estate and Total Fund Policy excludes NCREIF after 10/1/2008 18 B GROUP Defined Benefit Plan & Trust for Employees of the City of Winter Springs Comparative Performance Fiscal Year Returns Trailing Returns As of December 31, 2009 otal Fund (Excl RE) (Net) 2.16 -16.82 13.03 7.89 11.07 12.18 12.49 otal Fund Policy (Excl RE) 0.33 -12.11 11.97 9.55 10.76 11.65 18.84 lifference 1.83 -4.71 1.06 -1.66 0.31 0.53 -6.35 otal Fund (New Mgrs)(Excl RE) (Net) 2.16 -16.82 N/A N/A N/A N/A N/A otal Fund Policy (Excl RE) 0.33 -12.11 11.97 9.55 10.76 11.65 18.84 lifference 1.83 -4.71 N/A N/A N/A N/A N/A otal Fund (Excl RE) (Gross) 2.89 -16.46 13.92 8.62 11.82 13.05 13.34 otal Fund Policy (Excl RE) 0.33 -12.11 11.97 9.55 10.76 11.65 18.84 lifference 2.56 -4.35 1.95 -0.93 1.06 1.40 -5.50 otal Fund (New Mgrs)(Excl RE) (Gross) 2.89 -16.46 N/A N/A N/A N/A N/A otal Fund Policy (Excl RE) 0.33 -12.11 11.97 9.55 10.76 11.65 18.84 lifference 2.56 -4.35 N/A N/A N/A N/A N/A Returns for periods greater than one year are annualized. Returns are expressed as percentages. 10/1/2007 inception date represents the date new managers were �� THE hired. Total Fund Policy represents new policy beginning 10/1/2009. Old policy geometrically linked to new policy. See benchmark history for details. Total Fund D OGDAHN excludes real estate and Total Fund Policy excludes NCREIF after 10/1/2008 19 B GROUP Defined Benefit Plan & Trust for Employees of the City of Winter Springs Comparative Performance Fiscal Year Returns Trailing Returns As of December 31, 2009 Total Equity Portfolio -1.09 -25.61 18.52 10.83 15.40 17.60 18.76 Total Equity Policy -6.91 -21.98 16.44 12.51 14.30 15.14 2 Difference 5.82 -3.63 2.08 -1.68 1.10 2.46 -5. S 8 Domestic Equity Portfolio -4.29 -21.66 17.58 9.29 13.77 16.77 17.81 Total Domestic Equity Policy -6.91 -21.98 16.44 10.79 12.25 13.87 24.40 Difference 2.62 0.32 1.14 -1.50 1.52 2.90 -6.59 International Equity Portfolio 11.87 -39.55 23.63 19.84 26.83 22.94 27.32 MSCI EAFE Index 3.80 -30.13 25.38 19.65 26.32 22.52 26.54 Difference 8.07 -9.42 -1.75 0.19 0.51 0.42 0.78 Total Fixed Portfolio 10.53 0.64 4.96 3.27 2.81 2.68 5.24 Total Fixed Policy 9.69 4.16 5.33 3.55 2.80 3.68 5.40 Difference 0.84 -3.52 -0.37 -0.28 0.01 -1.00 -0.16 Returns for periods greater than one year are annualized. Returns are expressed as percentages. 10/1/2007 inception date represents the date new managers were �� THE hired. Total Fund Policy represents new policy beginning 10/1/2009. Old policy geometrically linked to new policy. See benchmark history for details. Total Fund D OGDAHN excludes real estate and Total Fund Policy excludes NCREIF after 10/1/2008 20 B GROUP Defined Benefit Plan & Trust for Employees of the City of Winter Springs Comparative Performance Fiscal Year Returns Trailing Returns As of December 31, 2009 Dalton, Greiner, Hartman, Maher & Co. N/A N/A N/A N/A N/A N/A N/A Russell 3000 Value Index -10.79 -22.70 13.73 14.55 16.78 20.89 24.89 Difference N/A N/A N/A N/A N/A N/A N/A Lateef Asset Mgmt.Equity 0.53 -15.13 N/A N/A N/A N/A N/A Russell 1000 Growth Index -1.85 -20.88 19.35 6.04 11.60 7.51 25.92 Difference 2.38 5.75 N/A N/A N/A N/A N/A RBC Global (Voyageur) 11.87 N/A N/A N/A N/A N/A N/A MSCI EAFE Index 3.80 -30.13 25.38 19.65 26.32 22.52 26.54 Difference 8.07 N/A N/A N/A N/A N/A N/A Galliard Core Fixed Income 12.08 -1.68 N/A N/A N/A N/A N/A Barclays Capital Intermediate Aggregate 9.69 4.16 5.33 3.84 2.23 3.39 4.94 Difference 2.39 -5.84 N/A N/A N/A N/A N/A Galliard TIPS 3.97 7.72 N/A N/A N/A N/A N/A Barclays Capital TIPS 5.67 6.20 4.97 1.91 5.32 7.52 7.22 Difference -1.70 1.52 N/A N/A N/A N/A N/A American Stable Value Fund -32.42 4.72 N/A N/A N/A N/A N/A Returns for periods greater than one year are annualized. Returns are expressed as percentages. 10/1/2007 inception date represents the date new managers were �� THE hired. Total Fund Policy represents new policy beginning 10/1/2009. Old policy geometrically linked to new policy. See benchmark history for details. Total Fund D OGDAHN excludes real estate and Total Fund Policy excludes NCREIF after 10/1/2008 21 B GROUP Defined Benefit Plan & Trust for Employees of the City of Winter Springs Benchmark History As of December 31, 2009 Total Fund Policv (Excl RE) Total Effective Date: Jan -1976 Effective Date: Jan -1970 S &P 500 Index 65.00 S &P 500 Index 90.00 Barclays Capital Aggregate 30.00 MSCI EAFE 10.00 MSCI EAFE 5.00 Effective Date: Oct -2003 Effective Date: Oct -2003 S &P 500 Index 85.00 S &P 500 Index 60.00 MSCI EAFE 15.00 Barclays Capital Aggregate 30.00 MSCI EAFE 10.00 Effective Date: Sep -2006 S &P 500 Index 100.00 Effective Date: Sep -2006 S &P 500 Index 60.00 Effective Date: Oct -2009 Barclays Capital Intermediate Aggregate 40.00 Russell 3000 Index 77.00 MSCI EAFE 23.00 Effective Date: Oct -2009 22 THE BOGDAHN GROUP Z£6COVZ'998 ZOZ£S u1SuoosiM `333InumpW 008I 01!nS and uisuoOsiAk '3 OSZ IISZ£ Ep«0I4 `Opuuljo 009 al!nS °prog purlauiA I06t SSSO9 sxouiiiI `aiiiAuaaJUAk OOZ 3 1?nS proU piai3uLm OZ£V aa 0puP1.10 02BaIu3 suoxs:aap xiv puv luauusaaur cnoi('B d f I cY vcka 1 ) NHVCIDOq 9HJL