Manager Performance Review and Monitoring

AS FUND ASSETS FLUCTUATE IN TODAY'S VOLATILE STOCK MARKET, how can you be certain your manager is providing maximum value for your investments while maintaining established guidelines? The answer, of course, is fundamental. Conduct a reliable, timely measurement and evaluation of your portfolio manager's performance.

DeMarche's quarterly manager performance analysis includes three reports: Capital Market Review, Performance Appraisal Report and Fund Diversification Monitor. They are described below. Your consultant will review these reports with you in person every quarter.

CAPITAL MARKET REVIEW

The Capital Market Review addresses general issues such as investment industry trends and capital market conditions. This report defines the economic and market environment within which your managers operated for the previous quarter and helps to put fund and manager performance in perspective.

PERFORMANCE APPRAISAL REPORT

With this report DeMarche introduced performance attribution to the manager performance industry in 1974. The Performance Appraisal Report (PAR) is an executive summary that provides a total fund summary, asset class summary and individual manager summary with appropriate benchmark comparisons. You will also receive a peer group comparison for each of your managers. This report features our exclusive Manager Grading System, which provides letter grades on each manager's ability to consistently add value. Custodial transaction statements are reconciled with asset statements and manager-provided returns each quarter.

FUND DIVERSIFICATION MONITOR

The Fund Diversification Monitor (FDM) contains a comprehensive, factor-based, attribution analysis of each manager. DeMarche was the first to use attribution analysis. The FDM analyzes your managers' abilities to add value by four skill sets: Market Timing, Sector Diversification, Security Concentration and Security Selection. The equity FDM utilizes one of DeMarche's factor models to attribute performance using more than 20 economic factors. The report combines factors to analyze the economic orientation, growth/value and aggressive/defensive characteristics and the skill sets your managers used to add value to your fund.