HomeMy Public PortalAbout2013 2nd Quarter ReportInvestment Performance AnalysisAs of June 30, 2013August 6, 2013Kristin Finney-Cooke, CAIA, Senior ConsultantKristen Jackson, CFA, Sr. AnalystThe Metropolitan St. Louis Sewer District Employees’ Pension Plan
Table of ContentsInvestment Outlook1Market Environment2Executive Summary3Asset Allocation4Performance Detail5Manager Summary6Manager Pages 7 TabThe Metropolitan St. Louis Sewer District Employees’ Pension PlanJune 30, 20131
Investment Outlook2
" A f t e r s t r o n g p e r f o r m a n c e a c r o s s m o s t a s s e t c l a s s e s i n t h e 1 s t q u a r t e r , m a r k e t s w e r e r o i l e d b y & I n d i c a t i o n s t h e F e d w o u l d t a p e r i t s s t i m u l a t i v e p o l i c y e a r l i e r t h a n e x p e c t e d C o n c e r n t h a t g r o w t h w a s s l o w i n g i n C h i n a a n d a c r o s s t h e e m e r g i n g m a r k e t s " T h e h i g h e r v o l a t i l i t y e n v i r o n m e n t h a s b e e n c h a l l e n g i n g T r e a s u r y y i e l d s s p i k e d o n e x p e c t a t i o n s o f t a p e r i n g , a n d c o n t i n u e d t o r i s e t h r o u g h J u n e V i r t u a l l y a l l m a r k e t s h a v e b e e n d o w n , l e a v i n g i n v e s t o r s n o p l a c e t o h i d e T r a d i t i o n a l h e d g i n g a s s e t s , s u c h a s T r e a s u r i e s , h a v e n o t w o r k e d E m e r g i n g m a r k e t s e q u i t y a n d d e b t h a v e e s p e c i a l l y s t r u g g l e d " H o w e v e r & D e v e l o p e d m a r k e t s a r e l a r g e l y p o s i t i v e o n t h e y e a r R a t e s a r e s t i l l l o w a n d s t i m u l a t i v e p o l i c y i s s t i l l i n p l a c e S i g n s o f U S r e c o v e r y a n d m o d e s t g r o w t h , e s p e c i a l l y i n h o u s i n g , a r e p r e s e n t E v e n w i t h t h e s l o w d o w n i n e m e r g i n g m a r k e t s , o v e r a l l g r o w t h i s s t i l l r e l a t i v e l y h i g h S e c o n d Q u a r t e r M a r k e t R e v i e w 3
Following a Positive 1stQuarter, May and June Have Shifted the Investment Landscape…Source: Bloomberg as of 6/304
& A n d U s h e r e d i n a H i g h e r V o l a t i l i t y E n v i r o n m e n t S o u r c e : M o r n i n g s t a r a s o f 6 / 3 0 5
Meanwhile… Treasury Rates Have Risen Rapidly, but Remain Low OverallSource: Bloomberg as of 6/30December 2010 December 2012So far in 2013… 6
Anticipation of Less Stimulative Monetary Policy Caused A Dramatic Increase In Real Yields7
Japan Enters the Easing Game as the ECB TightensSource: Bloomberg as of 7/12; All calculations made in Local Currency *GDP figure reflects World Bank Euro Area GDP8
" M a y a n d J u n e w e r e c h a l l e n g i n g m o n t h s f o r i n v e s t o r s T h e p r o s p e c t o f a n e a r l i e r t h a n e x p e c t t a p e r i n g o f s t i m u l a t i o n b y t h e F e d c o m b i n e d w i t h s l o w i n g g r o w t h i n e m e r g i n g m a r k e t s t o c r e a t e v o l a t i l i t y N e a r l y a l l s e c t o r s o f t h e m a r k e t e x p e r i e n c e d d o w n t u r n s , w i t h R i s k P a r i t y s t r a t e g i e s a n d e m e r g i n g m a r k e t s e s p e c i a l l y s t r u g g l i n g " T r e a s u r y y i e l d s s p i k e d , w i t h t h e 1 0 y e a r t r e a s u r y r a t e u p o v e r 8 0 b a s i s p o i n t s s o f a r i n 2 0 1 3 " T h e B o J c o n t i n u e d i t s h e a v i l y s t i m u l a t i v e p o l i c y b u t s a w J a p a n e s e e q u i t y m a r k e t s d i v e a t t h e e n d o f t h e q u a r t e r ; m e a n w h i l e t h e E C B h a s r e e l e d i n i t s p o l i c y o p p o s i t e t h a t o f t h e B o J a n d F e d " G o l d c o n t i n u e d i t s y e a r - t o - d a t e p l u m m e t l e a d i n g m o s t c o m m o d i t y p r i c e s d o w n c o n s i s t e n t w i t h s l o w i n g g r o w t h f o r e c a s t s " M a n y m a c r o e c o n o m i c a n d g e o p o l i t i c a l c h a l l e n g e s r e m a i n T a p e r i n g o f s t i m u l a t i v e m o n e t a r y p o l i c y i n t h e U S a n d / o r a b r o a d F u r t h e r s l o w d o w n i n C h i n a a n d b r o a d e r e m e r g i n g m a r k e t s P o t e n t i a l f o r r e n e w e d p e r i p h e r a l E u r o p e a n d e b t c r i s i s U S d e b t c e i l i n g d e b a t e l o o m i n g C o n f l i c t i n t h e M i d d l e E a s t ( o r e l s e w h e r e ) M a r k e t S u m m a r y 9
" D e s p i t e t h e t u r b u l e n t q u a r t e r m a n y p o s i t i v e s r e m a i n : U S e q u i t i e s h a v e p o s t e d s t r o n g g a i n s t h r o u g h t h e f i r s t h a l f o f 2 0 1 3 I n t e r e s t r a t e s r e m a i n l o w r e l a t i v e t o h i s t o r i c l e v e l s a n d s t i m u l a t i o n r e m a i n s i n p l a c e f o r n o w T h e U S e c o n o m y i s r e c o v e r i n g a n d t h e f i s c a l d e f i c i t h a s b e e n d e c l i n i n g G r o w t h i n e m e r g i n g m a r k e t s , w h i l e s l o w i n g , r e m a i n s h i g h e r t h a n d e v e l o p e d m a r k e t s " R i s k p a r i t y c o n t i n u e s t o r e p r e s e n t a s t r o n g f o u n d a t i o n f o r a s s e t a l l o c a t i o n " T h e l o n g - t e r m i n v e s t m e n t t h e s i s f o r e m e r g i n g m a r k e t s r e m a i n s i n t a c t a n d v a l u a t i o n s r e m a i n a t t r a c t i v e " I n f l a t i o n p r o s p e c t s r e m a i n m u t e d i n t h e n e a r - t e r m , h o w e v e r , t h e r i s k o f r i s i n g i n f l a t i o n r e s u l t i n g f r o m m o n e t a r y e x p a n s i o n p e r s i s t s " I l l i q u i d s t r a t e g i e s , p a r t i c u l a r d i r e c t l e n d i n g f u n d s , o f f e r a c o m p e l l i n g r i s k - r e t u r n p r o f i l e " W e e x p e c t m a r k e t v o l a t i l i t y t o r e m a i n e l e v a t e d i n c o m i n g m o n t h s ; i n v e s t o r s c a n m o v e a t a m e a s u r e d p a c e t o a l l o c a t e t o m o r e a t t r a c t i v e a s s e t c a t e g o r i e s M a r k e t O u t l o o k S t a y i n g t h e C o u r s e 1 0
Market Environment11
Investment Market Update: As of June 30, 2013June 30, 201312
Investment Market Update: As of June 30, 2013June 30, 2013PERFORMANCE THROUGH 6/30/2013SectorIndex20082009201020112012Q1APRMAYJUNQ22013Small Cap Growth Russell 2000 Growth-38.5%34.5% 29.1%-2.9%14.6% 13.2%-0.7%5.1%-0.6%3.7% 17.4%Large Cap Value Russell 1000 Value-36.8%19.7% 15.5% 0.4% 17.5% 12.3% 1.5% 2.6%-0.9%3.2% 15.9%Small Cap Russell 2000 -33.8%27.2% 26.9%-4.2%16.3% 12.4%-0.4%4.0%-0.5%3.1% 15.9%SMID Cap Russell 2500-36.8%34.4% 26.7%-2.5%17.9% 12.8% 0.3% 3.1%-1.1%2.3% 15.4%Small Cap Value Russell 2000 Value-28.9%20.6% 24.5%-5.5%18.1% 11.6%-0.1%3.0%-0.4%2.5% 14.4%Large Cap Russell 1000-37.6%28.4% 16.1% 1.5% 16.4% 11.0% 1.8% 2.2%-1.4%2.7% 13.9%Large Cap S&P 500-37.0%26.5% 15.1% 2.1% 16.0% 10.6% 1.9% 2.3%-1.3%2.9% 13.8%Large Cape Growth Russell 1000 Growth-38.4%37.2% 16.7% 2.6% 15.3% 9.5% 2.1% 1.9%-1.9%2.1% 11.8%Diversified Diversified*-24.5%24.1% 13.5% 1.3% 12.7% 5.9% 2.0%-0.1% -1.8%0.1% 6.1%REITS Wilshire US REIT -39.2%28.6% 28.6% 9.2% 17.6% 7.4% 6.6%-5.9% -1.7% -1.4%5.9%Int'l Developed MSCI EAFE-43.4%31.8% 7.8%-12.1%17.3% 5.1% 5.2%-2.4% -3.6% -1.0%4.1%High Yield Barclays US High Yield-26.2%58.2% 15.1% 5.0% 15.8% 2.9% 1.8%-0.6% -2.6% -1.4%1.4%Govt/Credit Barclays US Govt/Credit 1-3 5.0% 3.8% 2.8% 1.6% 1.3% 0.2% 0.1%-0.1% -0.1% -0.1%0.1%Govt/Credit Barclays Govt/Credit 1-5 Yr 5.1% 4.6% 4.1% 3.1% 2.2% 0.3% 0.3%-0.5% -0.6% -0.7% -0.5%Interm Govt/Credit Barclays US Govt/Credit Inte 5.1% 5.2% 5.9% 5.8% 3.9% 0.3% 0.6%-1.1% -1.2% -1.7% -1.4%Interm Core Bonds Barclays US Agg Interm 4.9% 6.5% 6.1% 6.0% 3.6% 0.2% 0.6%-1.3% -1.1% -1.8% -1.6%Core Bonds Barclays US Agg Bond 5.2% 5.9% 6.5% 7.8% 4.2%-0.1%1.0%-1.8% -1.5% -2.3% -2.4%Muni Bonds Barclays Municipal-2.5%12.9% 2.4% 10.7% 6.8% 0.3% 1.1%-1.2% -2.8% -3.0% -2.7%Global Bonds Citi WGBI 10.9% 2.6% 5.2% 6.4% 1.6%-2.8%1.1%-3.4% -0.6% -3.0% -5.7%EMD External Barclays EM USD-14.7%34.2% 12.8% 7.0% 17.9%-1.5%2.0%-2.7%-4.5% -5.1% -6.5%EMD LocalJPM GBI EM Glob Div-5.2%22.0% 15.7%-1.8%16.8%-0.1%3.4%-6.3% -4.1% -7.0% -7.2%Long Govt/Credit Barclays US Govt/Credit Long8.4% 1.9% 10.2% 22.5% 8.8%-2.0%3.9%-5.4% -4.5% -6.1% -8.0%Long Credit Barclays US Long Credit -3.9% 16.8% 10.7% 17.1% 12.7%-1.8%4.0%-4.9% -5.3% -6.3% -8.0%Emerging Equities MSCI EM-53.3%78.5% 18.9%-18.4%18.2%-1.6%0.8%-2.6% -6.4% -8.1% -9.6%Commodities DJ UBS Commodity-35.6%18.9% 16.8%-13.3% -1.1% -1.1% -2.8% -2.2% -4.7% -9.5% -10.5%Treasury STRIPS Barclays US Strips 20+ Yr 59.5%-36.0%10.9% 58.5% 3.0%-5.4%7.2%-10.0% -4.2% -7.6% -12.6%* 35% LC, 10% SC, 12% Intl Equity, 3% Emerging Equity, 25% Core Bonds, 5% HY, 5% Global Bonds, 5% REITSSources: Barclays, Bloomberg, Wilshire13
8 % 6 % 4 % 2 % 0 % 2 % 4 % 6 % 8 % 1 0 % R e a l � G r o s s � D o m e s t i c � P r o d u c t � G r o w t h U S E c o n o m i c E n v i r o n m e n t J u n e 3 0 , 2 0 1 3 S o u r c e : B l o o m b e r g a s o f 6 / 3 0 S o u r c e : B l o o m b e r g a s o f 5 / 3 1 S o u r c e : B l o o m b e r g a s o f 6 / 3 0 S o u r c e : B l o o m b e r g a s o f 5 / 3 1 C o n s u m e r c o n f i d e n c e j u m p e d t o 8 1 . 4 i n J u n e , i t s h i g h e s t l e v e l s i n c e J a n u a r y 2 0 0 8 ; t h e C a s e - S h i l l e r h o m e p r i c e i n d e x ( a s o f 3 / 3 1 ) r o s e s l i g h t l y t h r o u g h M a r c h R o l l i n g 1 2 m o n t h C P I i n c r e a s e d t o 1 . 4 % a t M a y e n d ; c a p a c i t y u t i l i z a t i o n d e c r e a s e d t o 7 7 . 6 % i n t h e m o n t h F i r s t q u a r t e r G D P g r o w t h w a s r e v i s e d t o 1 . 8 % , d o w n f r o m a n i n i t i a l e s t i m a t i o n o f 2 . 5 % U n e m p l o y m e n t i n c r e a s e d s l i g h t l y t o 7 . 6 % i n M a y ; U - 6 d e c r e a s e d t o 1 3 . 8 % 1 . 8 % 0 % 2 % 4 % 6 % 8 % 1 0 % 1 2 % 1 4 % 1 6 % 1 8 % U n e m p l o y m e n t � R a t e � v s . � U 6 U n e m p l o y m e n t � R a t e U 6 6 0 % 6 5 % 7 0 % 7 5 % 8 0 % 8 5 % 9 0 % 9 5 % 1 0 0 % 6 % 3 % 0 % 3 % 6 % 9 % 1 2 % 1 5 % 1 8 % 1 9 7 2 1 9 7 4 1 9 7 6 1 9 7 8 1 9 8 0 1 9 8 2 1 9 8 4 1 9 8 6 1 9 8 8 1 9 9 0 1 9 9 2 1 9 9 4 1 9 9 6 1 9 9 8 2 0 0 0 2 0 0 2 2 0 0 4 2 0 0 6 2 0 0 8 2 0 1 0 2 0 1 2 % � o f � T o t a l � C a p a c i t y R o l l i n g � 1 2 � M o n t h � C P I C a p a c i t y � U t i l i z a t i o n � v s . � R o l l i n g � 1 2 � M o n t h � C P I 1 2 M o � C P I C a p a c i t y � U t i l i z a t i o n 0 3 0 6 0 9 0 1 2 0 1 5 0 1 8 0 2 1 0 1 9 9 0 1 9 9 1 1 9 9 2 1 9 9 3 1 9 9 4 1 9 9 5 1 9 9 6 1 9 9 7 1 9 9 8 1 9 9 9 2 0 0 0 2 0 0 1 2 0 0 2 2 0 0 3 2 0 0 4 2 0 0 5 2 0 0 6 2 0 0 7 2 0 0 8 2 0 0 9 2 0 1 0 2 0 1 1 2 0 1 2 2 0 1 3 H o m e � P r i c e � I n d e x � a n d � C o n s u m e r � C o n f i d e n c e S & P � C a s e S h i l l e r � H o m e � P r i c e � I n d e x C o n s u m e r � C o n f i d e n c e 1 4
Components of GDPJune 30, 2013Source: Bloomberg as of 3/31Source: Bloomberg as of 4/30Source: Bloomberg as of 5/31Source: Bloomberg as of 4/30Corporate Profits as a percent of GDP remained near secular highs at 12.4% at Q1 endThe trade deficit increased through AprilRetail sales rose to a 3.4% year-over-year growth rate in MayThe inventory-to-sales ratio has remained mostly flat since early 2010 – but closed at 1.31 in April; its highest level since October 2009‐10%‐5%0%5%10%15%199619971998199920002001200220032004200520062007200820092010201120122013Annual % ChangeRetail Sales 1.21.31.41.51.6199319941995199619971998199920002001200220032004200520062007200820092010201120122013Inventory to Sales Ratio ‐$80‐$70‐$60‐$50‐$40‐$30‐$20‐$10$01994199519961997199819992000200120022003200420052006200720082009201020112012BillionsU.S. Trade Surplus (Deficit) 6%7%8%9%10%11%12%13%197319751977197919811983198519871989199119931995199719992001200320052007200920112013Corporate Profits as % of GDP Profits/GDPAverage15
Key Economic IndicatorsJune 30, 2013Source: Bureau of Economic Analysis, Congressional Budget Office as of 1/1Source: Bloomberg as of 5/31Source: Bloomberg as of 4/30Source: Bloomberg as of 5/31US GDP relative to potential GDP rose slightly at year end but still sits near historic lowsChicago Fed National Activity 3 Month moving average drifted further into the negative through MayThe rolling percentage change in the Leading Economic Indicators index fell to 2.04% through MayThe small business optimism index increased to 94.4 through May, up from 88.0 at year end‐20%‐15%‐10%‐5%0%5%10%15%20%12 Month Rolling ChangeEcon. Conference Board Leading Econ. Indicators 808590951001051101151992199319941995199619971998199920002001200220032004200520062007200820092010201120122013Index Value (1986 = 100)Small Business Optimism Index ‐5‐4‐3‐2‐10123Chicago Fed National Activity 3‐Mo. Mvg. Avg.‐10%‐8%‐6%‐4%‐2%0%2%4%6%8%1949195219551958196119641967197019731976197919821985198819911994199720002003200620092012US GDP Relative to Potential16
Economic Environment – Monetary Policy and BanksJune 30, 2013Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30The Japanese Yen has weakened 14.3% relative to the US dollar in 2013; while the MSCI Japan TR Net Local Index returned 32.6%After more dramatic movements in 2012 Eurozone excess reserves have steadily decreased as US excess reserves experienced a sharp increase through JuneFederal Reserve Bank balance sheets have increased in 2013 while European Central Bank balance sheets have decreased significantlyCentral bank assets worldwide have risen significantly since 2008 but have experienced a recent slowdown outside of the Federal Reserve€400 €800 €1,200 €1,600 €2,000 €2,400 €2,800 €3,200 $500$1,000$1,500$2,000$2,500$3,000$3,500$4,000Jan‐08Apr‐08Jul‐08Oct‐08Jan‐09Apr‐09Jul‐09Oct‐09Jan‐10Apr‐10Jul‐10Oct‐10Jan‐11Apr‐11Jul‐11Oct‐11Jan‐12Apr‐12Jul‐12Oct‐12Jan‐13Apr‐13BillionsBillionsFed vs. ECB Balance SheetsFedECB€0€200€400€600€800€1,000€1,200€1,400$0$200$400$600$800$1,000$1,200$1,400$1,600$1,800$2,000Jan‐08Apr‐08Jul‐08Oct‐08Jan‐09Apr‐09Jul‐09Oct‐09Jan‐10Apr‐10Jul‐10Oct‐10Jan‐11Apr‐11Jul‐11Oct‐11Jan‐12Apr‐12Jul‐12Oct‐12Jan‐13Apr‐13BillionsBillionsUS vs. Eurozone Excess ReservesUSEurozone$0$2,000,000$4,000,000$6,000,000$8,000,000$10,000,000$12,000,000$14,000,000$16,000,000USD (000,000s)Central Bank AssetsPBoCSNBBoJBoEECBFED4004505005506006507007508007580859095100105110Japanese Yen Spot vs. MSCI Japan LocalJapanese Yen Spot USD (LHS)MSCI Japan Local Index (RHS)17
Looming Macro UncertaintiesJune 30, 2013Source: Morningstar as of 6/30*Shown as the midpoint of a range; Source: CRFB, Capital EconomicsSource: Bloomberg as of 6/30Source: Bloomberg as of 6/30‐6%‐5%‐4%‐3%‐2%‐1%0%CBO* CapitalEconomicsCRFB Zandi GoldmanSachsMorganStanley*Estimated Drag on GDP GrowthEstimated drag on GDP from 2013 fiscal austerity02004006008001000120014001600Jun‐07Sep‐07Dec‐07Mar‐08Jun‐08Sep‐08Dec‐08Mar‐09Jun‐09Sep‐09Dec‐09Mar‐10Jun‐10Sep‐10Dec‐10Mar‐11Jun‐11Sep‐11Dec‐11Mar‐12Jun‐12Sep‐12Dec‐12Mar‐13Basis PointsEurozone CDSPortugalItalyGermanySpain0%5%10%15%20%25%30%S&P 500 MSCI EAFE MSCI EM BC US Agg Treasury BC US Corp HYMarket Volatility1 Yr Return Std Dev10 Yr Return Std Dev‐5%‐4%‐3%‐2%‐1%0%1%2%3%Greece Spain Italy Portugal France Ireland GermanyReal GDP Growth10 Yr Average2013 Projected18
05101520253035Equity Valuations: S&P 500 P/E RatioP/E RatioLT Avg.Market Environment – US EquityJune 30, 2013Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30The S&P 500's 50-day moving average remained above its 150-day moving average in JuneS&P valuations remain below the long-term average The VIX rose 3.4% and the S&P 500 fell 1.3% in JuneQE1QE2Op. TwistOp. Twist Ext. / QE3*Ex-negative earners02004006008001000120014001600180001020304050607080902003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013S&P 500VIXVIX vs S&P 500VIXS&P 50012001250130013501400145015001550160016501700S&P 500 MomentumS&P 50050 Day Mov. Avg.150 Day Mov. Avg.19
US Stock Market PerformanceJune 30, 2013Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Value stocks have outperformed growth in 2013 Domestic equity has outperformed international equity in 2013Healthcare leads all sectors YTD as financials and consumer discretionary posted strong second quarters; Materials continued to lagSmall cap has marginally outperformed large cap in 2013‐25%‐15%‐5%5%15%25%35%19791980198119821983198419851986198719881989199019911992199319941995199619971998199920002001200220032004200520062007200820092010201120122013Large Cap vs. Small Cap Equity ReturnsLarge Cap OutperformsSmall Cap Outperforms‐55%‐45%‐35%‐25%‐15%‐5%5%15%25%35%19791980198119821983198419851986198719881989199019911992199319941995199619971998199920002001200220032004200520062007200820092010201120122013Domestic vs. International Equity ReturnsDomestic OutperformsInt'l Outperforms‐35%‐25%‐15%‐5%5%15%25%35%19791980198119821983198419851986198719881989199019911992199319941995199619971998199920002001200220032004200520062007200820092010201120122013Large Value vs. Large Growth Equity ReturnsValue OutperformsGrowth Outperforms‐5% 0% 5% 10% 15% 20% 25%Con.Discretionary (11.6%)Con.Staples (11.01%)Energy (10.97%)Financials (15.92%)Health Care (12.61%)Industrials (10.04%)Info Tech. (17.92%)Materials (3.41%)Telecom (3.01%)Utilities (3.52%)S&P 500 Sector Returns and WeightsQ2YTD20
Non-US Stock PerformanceJune 30, 2013Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Developed Market Equity Returns (U.S. Dollars)YTDQ21 Yr.3 Yr. Ann.Europe ex UK1.0%-1.4%19.7% 6.8%United Kingdom-1.9% -3.3%7.6% 9.3%Japan15.4% 4.2% 19.7% 6.7%Pacific Ex Japan-6.5% -11.9%7.8% 7.1%Canada-7.7% -8.0%1.4% 2.0%USA12.5% 2.2% 18.0% 18.8%US Dollar Return vs. Major Foreign Currencies(Negative = Dollar Depreciates, Positive = Dollar Appreciates)YTD Q21 Yr. 3 Yr. Ann.Euro1.4%-1.5% -2.7% -2.1%Japanese Yen12.5% 5.0% 19.5% 3.6%British Pound6.4%-0.1%3.2%-0.6%Canada5.7% 3.2% 3.3%-0.4%Australia12.1% 12.3% 10.7%-2.9%Currency Impact on Developed Mkt. Returns(Negative = Currency Hurt, Positive = Currency Helped)YTD Q21 Yr. 3 Yr. Ann.MSCI EAFE (Local) 11.0% 1.2% 24.9% 9.8%MSCI EAFE (USD)4.1%-1.0%18.6% 11.1%Currency Impact-6.9% -2.2% -6.3%1.3%‐20%‐15%‐10%‐5% 0% 5% 10% 15%Con.Discretionary (10.97%)Con.Staples (12.33%)Energy (7.16%)Financials (24.84%)Health Care (10.29%)Industrials (12.59%)Info Tech. (4.35%)Materials (8.86%)Telecom (4.93%)Utilities (3.67%)MSCI EAFE Sector Returns (Wgts.)YTDQ2468101214161820Jan‐05May‐05Sep‐05Jan‐06May‐06Sep‐06Jan‐07May‐07Sep‐07Jan‐08May‐08Sep‐08Jan‐09May‐09Sep‐09Jan‐10May‐10Sep‐10Jan‐11May‐11Sep‐11Jan‐12May‐12Sep‐12Jan‐13May‐13EAFE and EM Equity P/E RatioMSCI EAFEMSCI EM*Ex‐Negative Earners‐100%‐80%‐60%‐40%‐20%0%20%40%60%1992199319941995199619971998199920002001200220032004200520062007200820092010201120122013Developed vs. Emerging Markets Equity ReturnsEmerging OutperformsDeveloped Outperforms21
Emerging MarketsJune 30, 2013- MSCI EM PE Ratio is below its historical average- MSCI EM PB and PS Ratios are below historical averages- MSCI EM Small Cap PE Ratio is above its historical average- MSCI EM Small Cap PB and PS Ratios are below historical averagesSource: Bloomberg as of 6/30Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Emerging Markets ValuationMSCI EMMSCI EM Small CapPE Ratio11.4120.80PE Historical Avg14.4516.11PB Ratio1.431.19Historical Avg1.521.27PS Ratio 0.960.67Historical Avg1.070.70US Dollar Return vs. Major EM Currencies(Negative = Dollar Depreciates, Positive = Dollar Appreciates)YTD Q21 Yr. 3 Yr. Ann.Brazilian Real8.1% 9.4% 9.8% 6.4%Russian Ruble6.9% 5.3% 1.4% 1.6%Indian Rupee8.1% 8.7% 7.2% 7.4%Chinese Renminbi-1.5% -1.2% -3.5% -3.5%Singapore Dollar-0.4% -0.2% -0.9% -0.9%Hungarian Forint2.6%-4.8%0.5%-0.9%Turkish Lira7.5% 6.2% 6.0% 6.0%Mexican Peso0.7% 4.9%-3.2%0.0%So. African Rand14.3% 6.6% 17.3% 7.5%So. Korean Won6.9% 2.6% 0.1%-2.6%0%2%4%6%8%10%12%BrazilRussiaIndiaChinaBRIC GDP Growth Rates10 Yr Avg. Real GDP GrowthProjected 2013 Real GDP Growth0123456782002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012EM Sovereign Bond SpreadEM (Local) ‐ US Bond SpreadAverage22
Market Environment – Interest RatesJune 30, 2013Source: Bloomberg as of 6/30Source: Citigroup as of 5/31Source: US Treasury as of 6/30Source: Bloomberg as of 6/30Fed Funds rate remained at 0.25% while the 10 Yr. Treasury Yield finished June at 2.5%Citi Pension discount rose to 4.5% through May but remained near all-time lowsBond yields across the globe have mostly risen in 20130.0%0.5%1.0%1.5%2.0%2.5%3.0%3.5%4.0%4.5%5.0%0 5 10 15 20 25 30Years to Maturity U.S. Treasury Yield CurveJun‐13Dec‐12Dec‐11Dec‐100%1%2%3%4%5%6%7%US UK Euro Japan Australia EM*Global Bond Yields12/31/126/28/130%1%2%3%4%5%6%7%8%9%19931994199519961997199819992000200120022003200420052006200720082009201020112012201310 Year Treasury vs. Fed Funds Rate10 YR TreasuryFed Funds Rate3%4%5%6%7%8%9%1995199619971998199920002001200220032004200520062007200820092010201120122013Citigroup Pension Liabililty Index23
Fixed Income PerformanceJune 30, 2013Source: Barclays as of 6/30Source: Barclays, Bloomberg as of 6/30Source: Barclays as of 6/30Source: Barclays as of 6/30‐10%‐8%‐6%‐4%‐2%0%2%1‐3 Yr. Trs.3‐5 Yr. Trs. 7‐10 Yr.Trs.25+ Yr.Trs.Core High Yield GlobalBondEMDFixed Income ReturnsQ2YTD02004006008001000120014002003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013Basis PointsCorporate Spreads AaABaaBa‐14%‐12%‐10%‐8%‐6%‐4%‐2%0%WGBI US UK Japan Canada Australia JPM EMBIGlobal Bond ReturnsQ2YTD‐8%‐7%‐6%‐5%‐4%‐3%‐2%‐1%0%Treasuries Agencies MBS ABS Inv.Gr. Corp. Inter. Corp. Long Corp.Investment Grade Sector ReturnsQ2YTD24
Market Environment – CommoditiesJune 30, 2013Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Source: Bloomberg as of 6/30Corn prices finished June up at $6.96 per bushelOil prices finished June up at $96.56 per barrelGold prices finished June down at $1,234.57 per ounce$0$1$2$3$4$5$6$7$8$92002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013Corn Spot Price Per Bushel$0$200$400$600$800$1,000$1,200$1,400$1,600$1,800$2,0002002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013Gold Spot Price Per Ounce$0$20$40$60$80$100$120$140$1602002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013Oil Spot Price Per Barrel 25
Executive Summary26
Portfolio CommentaryTotal ReturnCurrent Allocation Total CompositeInvestment SummaryLast QuarterLast YearLast 3 YearsLast 5 YearsTotal Composite -1.0 9.6 10.4 5.8Rank 79 79 45 33Median Public Funds 0.0 11.4 10.0 5.2Policy Index -0.6 9.7 9.9 5.3Periods longer than one year are annualized*Rankings versus total Public Fund s1=best, 100=worst.20.0%5.0%10.0%3.0%13.0%5.0%5.0%8.0%2.0%10.0%4.0%5.0%5.0%5.0%0.0%‐15.0%‐10.0%‐5.0%0.0%5.0%10.0%15.0%20.0%25.0%Over/Under TargetPolicy Target•Goals & Objectives–The portfolios investment objective is to achieve a rate of return consistent with that of the set asset allocation, while maintaining a long term investment horizon for the Fund•Recent Decisions and Ongoing Activities–The Pension received a contribution in May, which was promptly invested.•Total Fund Performance / Asset Growth–As of the end of the 2ndquarter of 2013, the market value of assets held was $228.4 million, slightly down from $228.8 million at the end of the 1stquarter. During the 2ndquarter, the net cash inflow was $2.0 million and the investment decrease was $2.5 million.–The Fund returned -1.0% for the quarter, which ranked in the 79thpercentile in the IF Public DB Fund Extended Universe.–Trailing performance ranks below the median for the last 12 months and above for the three, five, and ten year periods.•Total Fund Asset Allocation–Currently, the Fund is relatively close to its policy benchmark in all classes.7June 30, 2013The Metropolitan St. Louis Sewer District Employees’ Pension Plan27
June 30, 2013
Note: All performance shown is gross of fees.
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Performance Summary
Market Value 3 Mo Rank YTD Rank 1 Yr Rank 3 Yrs Rank 5 Yrs Rank
_
Composite $228,397,049 -1.0%79 2.7%84 9.6%79 10.4%45 5.8%33
Composite Allocation Index -0.9%76 3.3%78 9.6%79 9.8%56 5.2%52
Policy Index -0.6%73 3.4%78 9.7%77 9.9%54 5.3%49
IFx Public DB Gross Median 0.0%5.0%11.4%10.0%5.2%
XXXXX
3 Years Ending June 30, 2013
Anlzd Ret Rank Anlzd Std
Dev Rank Sharpe
Ratio Rank Sortino
Ratio RF Rank
_
Composite 10.36% 45 8.50% 59 1.21 71 1.72 69
Composite Allocation Index 9.83%56 8.19%57 1.19 75 1.89 47
Policy Index 9.94% 54 8.37% 58 1.18 81 1.83 57
5 Years Ending June 30, 2013
Anlzd Ret Rank Anlzd Std
Dev Rank Sharpe
Ratio Rank Sortino
Ratio RF Rank
_
Composite 5.77% 33 10.61% 46 0.53 37 0.66 33
Composite Allocation Index 5.21%52 10.45%44 0.48 44 0.61 42
Policy Index 5.26% 49 11.28% 56 0.45 53 0.55 49
XXXXX
28
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Risk/Return
3 Years Ending June 30, 2013
% of Tot Anlzd Ret Rank Anlzd Std
Dev Rank
_
Composite 100.00% 10.36% 45 8.50% 59
Composite Allocation Index --9.83%56 8.19%57
Policy Index -- 9.94% 54 8.37% 58
IFx Public DB Gross Median --10.02%--8.00%--
XXXXX
3 Years Ending June 30, 2013
% of Tot Sharpe
Ratio Rank Sortino
Ratio RF Rank
_
Composite 100.00% 1.21 71 1.72 69
Composite Allocation Index --1.19 75 1.89 47
Policy Index -- 1.18 81 1.83 57
IFx Public DB Gross Median --1.29 --1.86 --
XXXXX
Note: All performance is shown gross of fees.
29
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Risk/Return
5 Years Ending June 30, 2013
% of Tot Anlzd Ret Rank Anlzd Std
Dev Rank
_
Composite 100.00% 5.77% 34 10.60% 31
Composite Allocation Index --5.21%57 10.45%30
Policy Index -- 5.26% 55 11.28% 43
IFx Public DB Gross Median --5.38%--11.77%--
XXXXX
5 Years Ending June 30, 2013
% of Tot Sharpe
Ratio Rank Sortino
Ratio RF Rank
_
Composite 100.00% 0.53 37 0.66 33
Composite Allocation Index --0.48 44 0.61 42
Policy Index -- 0.45 53 0.55 49
IFx Public DB Gross Median --0.46 --0.54 --
XXXXX
30
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Risk/Return
10 Years Ending June 30, 2013
% of Tot Anlzd Ret Rank Anlzd Std
Dev Rank
_
Composite 100.00% 7.46% 24 8.45% 25
Composite Allocation Index --6.98%48 8.33%24
Policy Index -- 6.93% 51 8.83% 31
IFx Public DB Gross Median --6.93%--9.71%--
XXXXX
10 Years Ending June 30, 2013
% of Tot Sharpe
Ratio Rank Sortino
Ratio RF Rank
_
Composite 100.00% 0.69 25 0.83 19
Composite Allocation Index --0.64 35 0.79 29
Policy Index -- 0.60 43 0.70 47
IFx Public DB Gross Median --0.58 --0.67 --
XXXXX
31
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Asset Growth Summary
Sources of Portfolio Growth Last Three
Months Year-To-Date One Year Three Years
_
Beginning Market Value $228,843,155 $212,281,687 $199,693,233 $175,554,940
Net Additions/Withdrawals $2,013,674 -$1,433,376 -$1,780,467 -$5,082,956
Investment Earnings -$2,459,781 $17,548,738 $30,484,283 $57,925,064
Ending Market Value $228,397,049 $228,397,049 $228,397,049 $228,397,049
_
32
Quarter Ending June 30, 2013
Beginning
Market Value Net Cash Flow Net Investment
Change
Ending
Market Value
_
Brandywine Global Bond $17,541,048 $925,000 -$612,696 $17,853,352
Cash $1,192,539 $50,517 $52 $1,243,108
GMO Asset Allocation Fund $22,682,363 $400,000 -$79,449 $23,002,914
Holland Capital $11,221,877 $300,000 $307,922 $11,829,799
Income Research $28,462,203 $1,525,000 -$537,311 $29,449,892
Kennedy $6,244,499 -$399,800 $126,590 $5,971,289
Loomis Credit Asset Fund $4,664,921 $0 -$73,298 $4,591,623
Morgan Stanley Inst Emg Mkt Port.$6,871,310 $0 -$436,191 $6,435,119
Morgan Stanley Int'l Equity Fund $23,022,348 $0 -$121,410 $22,900,938
Penn Capital $11,943,478 $0 -$221,737 $11,721,741
Pictet Emerging Local Curr. Debt Fd $11,501,269 $0 -$839,205 $10,662,063
PIMCO All Asset $10,464,190 $1,622,083 -$531,712 $11,554,561
Pyramis Mkt Neutral $10,192,113 $0 -$197,169 $9,994,944
T. Rowe Price $11,132,338 $400,000 $399,209 $11,931,547
TimesSquare Small Cap Growth Fund $6,388,262 -$600,000 $290,202 $6,078,463
UBS Realty - Trumbull Property Fund $9,883,061 -$29,126 $330,925 $10,184,860
Vanguard Institutional Index $7,598,374 -$655,000 $206,236 $7,149,610
Vanguard Windsor II $17,136,158 -$1,525,000 $650,034 $16,261,192
Wellington Diver. Inflation $10,700,805 $0 -$1,120,772 $9,580,033
Total $228,843,155 $2,013,674 -$2,459,781 $228,397,049
XXXXX
June 30, 2013
Note: A cash balance exists since benefits are paid from the Pension on the first business day each month. In addition, a small
cash balance is maintained to meet ongoing liquidity needs.
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Asset Growth Summary by Manager
33
Redemptions / Contributions during the 2ndQuarter were:Brandywine Global - $925,000 contributionHolland Capital - $300,000 contributionIncome Research - $1,525,000 contributionT. Rowe Price - $400,000 contributionVanguard Windsor II - $1,525,000 net redemptionsVanguard Institutional Index - $655,000 net redemptionsKennedy - $400,000 redemption less cash adjustment of $200.TimesSquare - $600,000 redemptionGMO GAA - $400,000 contributionUBS – Management Fees $29,126Detail on Total Fund Asset Growth SummaryJune 30, 2013The Metropolitan St. Louis Sewer District Employees’ Pension Plan34
Asset Allocation35
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Asset Allocation vs. Policy Targets
Note: A cash balance exists since benefits are paid from the Pension on the first
business day each month. In addition, a small cash balance is maintained to meet
ongoing liquidity needs.
Asset Allocation vs. Target
Current Policy Current Difference
*Policy Range Within
Range
_
Large Cap Equity $47,172,149 20.0%20.7%0.7%16.0% - 24.0%Yes
Small/Mid Cap Equity $12,049,752 5.0%5.3%0.3%3.0% - 7.0%Yes
Equity - International $22,900,938 10.0%10.0%0.0%8.0% - 12.0%Yes
Equity - Emerging $6,435,119 3.0%2.8%-0.2%2.0% - 5.0%Yes
Core Bonds $29,449,892 13.0%12.9%-0.1%10.0% - 20.0%Yes
High Yield Corporate Bonds $11,721,741 5.0%5.1%0.1%3.0% - 7.0%Yes
Fixed Income - Emerging $10,662,063 5.0%4.7%-0.3%3.0% - 7.0%Yes
Global Bonds $17,853,352 8.0%7.8%-0.2%6.0% - 10.0%Yes
Balanced - GAA $23,002,914 10.0%10.1%0.1%8.0% - 12.0%Yes
Opportunistic Credit $4,591,623 2.0%2.0%0.0%0.0% - 5.0%Yes
Absolute Return $11,554,561 4.0%5.1%1.1%3.0% - 7.0%Yes
Market Neutral $9,994,944 5.0%4.4%-0.6%3.0% - 7.0%Yes
Real Estate $10,184,860 5.0%4.5%-0.5%3.0% - 7.0%Yes
Real Assets $9,580,033 5.0%4.2%-0.8%3.0% - 7.0%Yes
Cash $1,243,108 --0.5%0.5%--No
Total $228,397,049 100.0%100.0%
XXXXX
*Difference between Policy and Current Allocation
36
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Asset Allocation History
37
Performance Detail38
June 30, 2013
Market Value
($)
% of
Portfolio Policy %3 Mo
(%)Rank YTD
(%)Rank 1 Yr
(%)Rank 3 Yrs
(%)Rank 5 Yrs
(%)Rank 10 Yrs
(%)Rank Return
(%)Since
_
Composite 228,397,049 100.0 100.0 -1.0 79 2.7 84 9.6 79 10.4 45 5.8 33 7.5 17 8.7 Oct-82
Composite Allocation Index -0.9 76 3.3 78 9.6 79 9.8 56 5.2 52 7.0 38 --Oct-82
Over/Under -0.1 -0.6 0.0 0.6 0.6 0.5
Policy Index -0.6 73 3.4 78 9.7 77 9.9 54 5.3 49 6.9 39 --Oct-82
IFx Public DB Gross Median 0.0 5.0 11.4 10.0 5.2 6.8 9.6 Oct-82
Large Cap Equity Composite 47,172,149 20.7 20.0 3.4 35 11.7 72 18.0 74 17.1 65 6.0 69 7.4 75 --Jun-03
S&P 500 2.9 49 13.8 48 20.6 52 18.5 41 7.0 53 7.3 80 7.4 Jun-03
Over/Under 0.5 -2.1 -2.6 -1.4 -1.0 0.1
eA US Large Cap Equity Gross Median 2.8 13.6 20.8 17.9 7.2 8.3 8.4 Jun-03
Vanguard Windsor II 16,261,192 7.1 7.0 4.1 41 14.9 62 23.1 63 18.9 36 7.8 41 8.4 58 6.0 May-01
Russell 1000 Value 3.2 62 15.9 44 25.3 43 18.5 42 6.7 63 7.8 72 5.5 May-01
Over/Under 0.9 -1.0 -2.2 0.4 1.1 0.6 0.5
eA US Large Cap Value Equity Gross
Median 3.8 15.7 24.6 18.2 7.5 8.6 6.4 May-01
Vanguard Institutional Index 7,149,610 3.1 3.0 2.7 53 13.6 49 20.3 56 18.4 42 7.0 56 7.3 80 3.6 Oct-99
S&P 500 2.9 49 13.8 47 20.6 53 18.5 41 7.0 56 7.3 82 3.6 Oct-99
Over/Under -0.2 -0.2 -0.3 -0.1 0.0 0.0 0.0
eA US Large Cap Core Equity Gross
Median 2.9 13.5 20.8 17.9 7.3 8.3 5.2 Oct-99
T. Rowe Price 11,931,547 5.2 5.0 3.6 12 --------------------4.7 Mar-13
Russell 1000 Growth 2.1 49 11.8 38 17.1 53 18.7 32 7.5 38 7.4 70 5.9 Mar-13
Over/Under 1.5 -1.2
eA US Large Cap Growth Equity Gross
Median 2.0 11.2 17.3 17.7 6.8 8.0 5.2 Mar-13
Holland Capital 11,829,799 5.2 5.0 2.8 28 --------------------4.7 Mar-13
Russell 1000 Growth 2.1 49 11.8 38 17.1 53 18.7 32 7.5 38 7.4 70 5.9 Mar-13
Over/Under 0.7 -1.2
eA US Large Cap Growth Equity Gross
Median 2.0 11.2 17.3 17.7 6.8 8.0 5.2 Mar-13
Small Cap Equity Composite 12,049,752 5.3 5.0 3.4 54 17.9 36 26.7 44 20.9 39 12.3 26 11.9 34 12.1 Jun-03
Russell 2000 3.1 60 15.9 59 24.2 65 18.7 68 8.8 70 9.5 84 9.6 Jun-03
Over/Under 0.3 2.0 2.5 2.2 3.5 2.4 2.5
eA US Small Cap Equity Gross Median 3.7 16.6 26.1 20.2 10.2 11.2 11.4 Jun-03
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Performance Detail - Gross of Fees
Note: All performance is shown gross of fees.
39
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Performance Detail - Gross of Fee
Market Value
($)
% of
Portfolio Policy %3 Mo
(%)Rank YTD
(%)Rank 1 Yr
(%)Rank 3 Yrs
(%)Rank 5 Yrs
(%)Rank 10 Yrs
(%)Rank Return
(%)Since
_
Kennedy 5,971,289 2.6 2.5 2.0 64 16.0 47 23.1 79 18.8 61 11.1 32 ----10.0 Feb-08
Russell MidCap Value 1.7 72 16.1 47 27.7 48 19.5 49 8.9 60 10.9 72 7.3 Feb-08
Over/Under 0.3 -0.1 -4.6 -0.7 2.2 2.7
eA US Mid Cap Value Equity Gross
Median 2.5 15.8 27.4 19.5 9.8 11.6 8.1 Feb-08
TimesSquare Small Cap Growth Fund 6,078,463 2.7 2.5 4.9 47 19.8 31 30.4 15 23.1 25 13.6 18 13.1 11 11.3 Feb-02
Russell 2000 Growth 3.7 66 17.4 61 23.7 57 20.0 69 8.9 62 9.6 78 7.0 Feb-02
Over/Under 1.2 2.4 6.7 3.1 4.7 3.5 4.3
eA US Small Cap Growth Equity Gross
Median 4.6 18.0 25.0 21.6 10.1 10.8 8.6 Feb-02
International Equity Composite 22,900,938 10.0 10.0 -0.3 49 5.7 43 19.5 58 13.0 36 2.6 36 8.7 68 5.3 May-99
S&P EPAC LargeMidCap -1.0 66 3.8 70 18.5 67 10.5 75 0.2 74 8.3 76 3.9 May-99
Over/Under 0.7 1.9 1.0 2.5 2.4 0.4 1.4
eA All EAFE Equity Gross Median -0.3 5.3 20.2 12.1 1.1 9.2 6.1 May-99
Morgan Stanley Int'l Equity Fund 22,900,938 10.0 10.0 -0.3 49 5.7 43 19.4 59 13.0 37 2.6 36 ----5.5 Apr-05
MSCI EAFE -1.0 65 4.1 66 18.6 66 10.0 80 -0.6 83 7.7 88 4.0 Apr-05
Over/Under 0.7 1.6 0.8 3.0 3.2 1.5
eA All EAFE Equity Gross Median -0.3 5.3 20.2 12.1 1.1 9.2 5.6 Apr-05
International Emerging Composite 6,435,119 2.8 3.0 -6.1 23 -5.0 29 8.5 30 7.0 36 0.6 51 ----10.9 Apr-05
MSCI Emerging Markets -8.1 61 -9.6 75 2.9 79 3.4 72 -0.4 67 13.7 76 9.4 Apr-05
Over/Under 2.0 4.6 5.6 3.6 1.0 1.5
eA Emg Mkts Equity Gross Median -7.7 -7.3 6.2 5.5 0.8 15.3 10.8 Apr-05
Morgan Stanley Inst Emg Mkt Port.6,435,119 2.8 3.0 -6.1 23 -5.0 29 8.3 32 6.9 36 0.6 51 ----10.9 Apr-05
MSCI Emerging Markets -8.1 61 -9.6 75 2.9 79 3.4 72 -0.4 67 13.7 76 9.4 Apr-05
Over/Under 2.0 4.6 5.4 3.5 1.0 1.5
eA Emg Mkts Equity Gross Median -7.7 -7.3 6.2 5.5 0.8 15.3 10.8 Apr-05
Fixed Income Composite 74,278,671 32.5 33.0 -3.0 82 -2.4 75 3.3 21 5.7 34 7.1 30 5.6 30 5.6 Jun-03
Barclays Int Govt/Credit -1.7 41 -1.4 48 0.3 67 3.1 76 4.6 75 4.0 76 4.0 Jun-03
Over/Under -1.3 -1.0 3.0 2.6 2.5 1.6 1.6
eA All US Fixed Inc Gross Median -1.9 -1.5 0.8 4.4 5.8 4.9 4.9 Jun-03
Note: All performance is shown gross of fees.
40
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Performance Detail - Gross of Fee
Market Value
($)
% of
Portfolio Policy %3 Mo
(%)Rank YTD
(%)Rank 1 Yr
(%)Rank 3 Yrs
(%)Rank 5 Yrs
(%)Rank 10 Yrs
(%)Rank Return
(%)Since
_
Income Research 29,449,892 12.9 13.0 -1.8 52 -1.4 45 1.2 30 4.1 24 6.0 20 5.1 10 5.8 Jul-01
Barclays Int Govt/Credit -1.7 36 -1.4 49 0.3 70 3.1 80 4.6 91 4.0 93 4.9 Jul-01
Over/Under -0.1 0.0 0.9 1.0 1.4 1.1 0.9
eA US Interm Duration Fixed Inc Gross
Median -1.8 -1.5 0.7 3.6 5.3 4.5 5.3 Jul-01
Penn Capital 11,721,741 5.1 5.0 -1.9 93 0.6 88 7.4 81 9.8 77 9.1 78 ----7.5 Aug-05
BofA Merrill Lynch High Yield Cash Pay -1.4 65 1.5 59 9.4 53 10.4 67 10.5 45 8.6 57 8.1 Aug-05
Over/Under -0.5 -0.9 -2.0 -0.6 -1.4 -0.6
eA US High Yield Fixed Inc Gross
Median -1.2 1.7 9.5 10.8 10.2 8.9 8.3 Aug-05
Loomis Credit Asset Fund 4,591,623 2.0 2.0 -1.6 3 0.4 5 7.8 1 8.8 6 --------9.0 Mar-10
50% BC Credit/ 25% S&P-LSTA/ 25%
BC HY -2.0 9 -0.9 12 4.6 19 7.1 43 8.0 53 6.2 38 7.3 Mar-10
Over/Under 0.4 1.3 3.2 1.7 1.7
eA US Corporate Fixed Inc Gross
Median -3.3 -2.8 2.9 6.7 8.1 5.9 7.3 Mar-10
Brandywine Global Bond 17,853,352 7.8 8.0 -3.3 71 -3.5 56 4.8 30 9.2 18 8.1 19 ----7.1 Jan-05
Citi WGBI -3.0 62 -5.7 81 -4.5 95 2.7 93 3.0 87 4.7 90 3.5 Jan-05
Over/Under -0.3 2.2 9.3 6.5 5.1 3.6
eA All Global Fixed Inc Gross Median -2.5 -3.2 2.1 5.2 5.1 5.7 4.8 Jan-05
Pictet Emerging Local Curr. Debt Fd 10,662,063 4.7 5.0 -7.3 81 -7.5 66 0.2 94 ------------3.8 Oct-11
JP Morgan GBI - EM Diversified -7.0 71 -7.2 49 1.3 83 6.0 83 6.7 76 10.3 42 5.0 Oct-11
Over/Under -0.3 -0.3 -1.1 -1.2
eA All Emg Mkts Fixed Inc Gross
Median -6.3 -7.2 3.0 7.7 8.3 10.1 8.3 Oct-11
Tactical Asset Allocation Composite 23,002,914 10.1 10.0 -0.3 13 3.5 22 10.0 16 10.5 18 6.4 14 8.0 76 6.9 Jun-03
S&P 500 2.9 2 13.8 1 20.6 1 18.5 1 7.0 7 7.3 92 7.4 Jun-03
Over/Under -3.2 -10.3 -10.6 -8.0 -0.6 0.7 -0.5
eA Global TAA Gross Median -2.4 -0.8 5.3 7.2 4.9 8.7 8.4 Jun-03
GMO Asset Allocation Fund 23,002,914 10.1 10.0 -0.3 13 3.5 22 10.0 16 10.5 18 6.4 14 ----6.2 Sep-06
65% MSCI World (Net) /35% BC Agg -0.4 14 4.5 10 11.5 12 10.4 22 4.1 60 6.6 99 4.2 Sep-06
Over/Under 0.1 -1.0 -1.5 0.1 2.3 2.0
eA Global TAA Gross Median -2.4 -0.8 5.3 7.2 4.9 8.7 5.2 Sep-06
Note: All performance is shown gross of fees; except Pictet which is shown net of fees.
41
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Performance Detail - Gross of Fee
Note: All performance shown is gross of fees.
.
Market Value
($)
% of
Portfolio Policy %3 Mo
(%)Rank YTD
(%)Rank 1 Yr
(%)Rank 3 Yrs
(%)Rank 5 Yrs
(%)Rank 10 Yrs
(%)Rank Return
(%)Since
_
Alternative Assets
Pyramis Mkt Neutral 9,994,944 4.4 5.0 -1.9 82 -2.3 82 -0.4 72 1.6 72 -1.7 84 ----3.7 Aug-05
91 Day T-Bill + 3%0.8 49 1.5 45 3.1 64 3.1 62 3.2 57 4.6 64 4.6 Aug-05
Over/Under -2.7 -3.8 -3.5 -1.5 -4.9 -0.9
eA|HFN Market Neutral Equity Net
Median 0.6 1.3 5.0 3.9 4.2 6.3 6.9 Aug-05
PIMCO All Asset 11,554,561 5.1 4.0 -4.0 61 -3.1 67 6.5 43 8.2 42 7.2 6 ----6.9 Jan-06
CPI + 5% 1.5 4 3.3 23 6.8 42 7.4 49 6.4 14 7.5 90 7.3 Jan-06
Over/Under -5.5 -6.4 -0.3 0.8 0.8 -0.4
eA Global TAA Gross Median -2.4 -0.8 5.3 7.2 4.9 8.7 5.6 Jan-06
UBS Realty - Trumbull Property Fund 10,184,860 4.5 5.0 3.3 --5.1 --9.5 --12.4 --1.6 ------4.5 Jul-06
NCREIF ODCE 0.0 --2.7 --8.0 --13.5 ---0.9 --6.5 --2.8 Jul-06
Over/Under 3.3 2.4 1.5 -1.1 2.5 1.7
Wellington Diver. Inflation 9,580,033 4.2 5.0 -10.5 ---10.8 ---5.2 --4.2 ----------0.9 Mar-10
Wellington DIH Multi-Asset Inflation
Index -7.5 ---8.5 ---3.8 --3.1 ---5.2 --7.5 --0.8 Mar-10
Over/Under -3.0 -2.3 -1.4 1.1 0.1
Wellington DIH Index -2.2 --2.1 --9.9 --9.6 ---1.4 --5.8 --6.8 Mar-10
Cash 1,243,108 0.5 0.0 0.0 --0.0 --0.0 --0.1 --0.4 --1.8 --1.7 Jun-03
BofA Merrill Lynch 91-Day T-Bill 0.0 --0.0 --0.1 --0.1 --0.3 --1.7 --1.7 Jun-03
Over/Under 0.0 0.0 -0.1 0.0 0.1 0.1 0.0
XXXXX
42
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Performance Detail - Net of Fee
Market Value
($)Policy %% of
Portfolio
1 Mo
(%)
3 Mo
(%)
YTD
(%)
1 Yr
(%)
3 Yrs
(%)
5 Yrs
(%)
10 Yrs
(%)
Return
(%)Since
_
Composite 228,397,049 100.0 100.0 -1.9 -1.0 2.6 9.3 9.8 5.2 7.0 8.5 Oct-82
Composite Allocation Index -1.7 -0.9 3.3 9.6 9.8 5.2 7.0 --Oct-82
Policy Index -1.7 -0.6 3.4 9.7 9.9 5.3 6.9 --Oct-82
Large Cap Equity Composite 47,172,149 20.0 20.7 -1.2 3.4 11.7 17.9 16.8 5.7 7.2 --Jun-03
S&P 500 -1.3 2.9 13.8 20.6 18.5 7.0 7.3 7.4 Jun-03
Vanguard Windsor II 16,261,192 7.0 7.1 -1.2 4.0 14.8 22.8 18.6 7.5 8.1 5.6 May-01
Russell 1000 Value -0.9 3.2 15.9 25.3 18.5 6.7 7.8 5.5 May-01
Vanguard Institutional Index 7,149,610 3.0 3.1 -1.3 2.9 13.8 20.4 18.4 7.0 7.3 3.5 Oct-99
S&P 500 -1.3 2.9 13.8 20.6 18.5 7.0 7.3 3.6 Oct-99
T. Rowe Price 11,931,547 5.0 5.2 -1.5 3.6 ----------4.7 Mar-13
Russell 1000 Growth -1.9 2.1 11.8 17.1 18.7 7.5 7.4 5.9 Mar-13
Holland Capital 11,829,799 5.0 5.2 -0.7 2.8 ----------4.7 Mar-13
Russell 1000 Growth -1.9 2.1 11.8 17.1 18.7 7.5 7.4 5.9 Mar-13
Small Cap Equity Composite 12,049,752 5.0 5.3 0.1 3.3 17.6 26.0 19.9 11.4 11.2 11.4 Jun-03
Russell 2000 -0.5 3.1 15.9 24.2 18.7 8.8 9.5 9.6 Jun-03
Kennedy 5,971,289 2.5 2.6 -1.2 2.0 16.0 23.1 18.2 10.5 --9.4 Feb-08
Russell MidCap Value -1.2 1.7 16.1 27.7 19.5 8.9 10.9 7.3 Feb-08
TimesSquare Small Cap Growth Fund 6,078,463 2.5 2.7 1.4 4.6 19.1 29.0 21.8 12.4 12.0 10.2 Feb-02
Russell 2000 Growth -0.6 3.7 17.4 23.7 20.0 8.9 9.6 7.0 Feb-02
International Equity Composite 22,900,938 10.0 10.0 -1.8 -0.5 5.2 18.4 11.9 1.6 7.8 4.7 May-99
S&P EPAC LargeMidCap -3.7 -1.0 3.8 18.5 10.5 0.2 8.3 3.9 May-99
Morgan Stanley Int'l Equity Fund 22,900,938 10.0 10.0 -1.8 -0.5 5.2 18.4 11.9 1.6 --4.5 Apr-05
MSCI EAFE -3.6 -1.0 4.1 18.6 10.0 -0.6 7.7 4.0 Apr-05
International Emerging Composite 6,435,119 3.0 2.8 -6.5 -6.3 -5.6 7.0 5.5 -0.8 --9.5 Apr-05
MSCI Emerging Markets -6.4 -8.1 -9.6 2.9 3.4 -0.4 13.7 9.4 Apr-05
Morgan Stanley Inst Emg Mkt Port.6,435,119 3.0 2.8 -6.5 -6.3 -5.6 7.0 5.5 -0.8 --9.5 Apr-05
MSCI Emerging Markets -6.4 -8.1 -9.6 2.9 3.4 -0.4 13.7 9.4 Apr-05
Fixed Income Composite 74,278,671 33.0 32.5 -2.3 -3.0 -2.5 3.2 5.2 6.7 5.4 5.3 Jun-03
Barclays Int Govt/Credit -1.2 -1.7 -1.4 0.3 3.1 4.6 4.0 4.0 Jun-03
Income Research 29,449,892 13.0 12.9 -1.3 -1.8 -1.4 1.2 3.8 5.8 5.0 5.7 Jul-01
Barclays Int Govt/Credit -1.2 -1.7 -1.4 0.3 3.1 4.6 4.0 4.9 Jul-01
Penn Capital 11,721,741 5.0 5.1 -2.9 -2.0 0.3 6.7 9.0 8.4 --6.8 Aug-05
BofA Merrill Lynch High Yield Cash Pay -2.6 -1.4 1.5 9.4 10.4 10.5 8.6 8.1 Aug-05
Loomis Credit Asset Fund 4,591,623 2.0 2.0 -2.2 -1.6 0.4 7.7 8.4 ----8.6 Mar-10
50% BC Credit/ 25% S&P-LSTA/ 25% BC HY -2.2 -2.0 -0.9 4.6 7.1 8.0 6.2 7.3 Mar-10
43
June 30, 2013
Note: Results for periods longer than one year are annualized
Note: Total percentages may add to more than 100% due to rounding
Note: PIMCO All Asset Benchmark: 40% BG Agg/30% US TIPS/10% S&P 500/10% HY/10% JPM EMBI+
Note: Wellington benchmark: 55% MSCI World/25% GSCI/20% BC 1-10 yr TIPS
Note: Return for T. Rowe Price is estimated using Morningstar.com return as the fund's statement is not available at the time of report construction.
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Performance Detail - Net of Fee
Market Value
($)Policy %% of
Portfolio
1 Mo
(%)
3 Mo
(%)
YTD
(%)
1 Yr
(%)
3 Yrs
(%)
5 Yrs
(%)
10 Yrs
(%)
Return
(%)Since
_
Brandywine Global Bond 17,853,352 8.0 7.8 -2.2 -3.3 -3.5 4.8 8.9 7.9 --7.0 Jan-05
Citi WGBI -0.6 -3.0 -5.7 -4.5 2.7 3.0 4.7 3.5 Jan-05
Pictet Emerging Local Curr. Debt Fd 10,662,063 5.0 4.7 -4.3 -7.3 -7.5 0.2 ------3.8 Oct-11
JP Morgan GBI - EM Diversified -4.1 -7.0 -7.2 1.3 6.0 6.7 10.3 5.0 Oct-11
Tactical Asset Allocation Composite 23,002,914 10.0 10.1 -2.0 -0.3 3.3 9.5 10.0 5.8 7.3 6.2 Jun-03
S&P 500 -1.3 2.9 13.8 20.6 18.5 7.0 7.3 7.4 Jun-03
GMO Asset Allocation Fund 23,002,914 10.0 10.1 -2.0 -0.3 3.3 9.5 10.0 5.8 --5.5 Sep-06
65% MSCI World (Net) /35% BC Agg -2.1 -0.4 4.5 11.5 10.4 4.1 6.6 4.2 Sep-06
Alternative Assets
Pyramis Mkt Neutral 9,994,944 5.0 4.4 -0.4 -1.9 -2.3 -0.4 1.0 -2.2 --3.3 Aug-05
91 Day T-Bill + 3% 0.3 0.8 1.5 3.1 3.1 3.2 4.6 4.6 Aug-05
PIMCO All Asset 11,554,561 4.0 5.1 -3.8 -4.2 -3.4 5.7 7.4 6.3 --6.0 Jan-06
CPI + 5% 0.9 1.5 3.3 6.8 7.4 6.4 7.5 7.3 Jan-06
UBS Realty - Trumbull Property Fund 10,184,860 5.0 4.5 3.3 3.3 5.1 9.5 11.8 1.0 --3.9 Jul-06
NCREIF ODCE 0.0 0.0 2.7 8.0 13.5 -0.9 6.5 2.8 Jul-06
Wellington Diver. Inflation 9,580,033 5.0 4.2 -6.1 -10.5 -10.8 -5.2 3.6 ----0.3 Mar-10
Wellington DIH Multi-Asset Inflation Index -4.8 -7.5 -8.5 -3.8 3.1 -5.2 7.5 0.8 Mar-10
Wellington DIH Index -1.8 -2.2 2.1 9.9 9.6 -1.4 5.8 6.8 Mar-10
Cash 1,243,108 0.0 0.5 0.0 0.0 0.0 0.0 0.1 0.0 1.6 1.6 Jun-03
BofA Merrill Lynch 91-Day T-Bill 0.0 0.0 0.0 0.1 0.1 0.3 1.7 1.7 Jun-03
XXXXX
44
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Return Summary
Note: All performance is shown gross of fees.
45
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Return Summary vs. Peer Universe
Note: All performance is shown gross of fees.
46
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Return Summary vs. Peer Universe
Note: All performance is shown gross of fees.
47
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Risk Statistics vs. Peer Universe
Composite vs. IFx Public DB Gross
3 Years
48
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Total Fund Risk Statistics vs. Peer Universe
Composite vs. IFx Public DB Gross
5 Years
49
Manager Summary 50
Manager Watch ListJune 30, 2013The Metropolitan St. Louis Sewer District Employees’ Pension PlanManager Probation Guidelines provide a performance based measure for inclusion on “watch” status. Managers who do not remain in the upper half of their universe and lag their index over a rolling 3-year period for three consecutive quarters will be considered for placement on watch status. The table above has highlighted in pale red managers that do not meet those performance guidelines. “N/A” indicates that the manager either does not have three years of performance or an appropriate universe for comparison.In addition to the performance measures, other scenarios could lead to “watch” status. These scenarios include changes in strategy, change in organizational structure or personnel, compliance related issues, changes in MSD’s asset allocation, or any other issue that requires heightened review.Penn Capital is more conservative than the benchmark and will therefore often have a performance lag. This performance is expected.4Q 2012 4Q 2012 1Q 2013 1Q 2013 2Q 2013 2Q 20133 Year Annualized Performance - Gross of FeeExcess Perf to BenchmarkRankExcess Perf to BenchmarkRankExcess Perf to BenchmarkRank ActionVanguard Windsor II-0.652-1.0590.436T. Rowe Pricen/an/an/an/an/an/aHolland Capitaln/an/an/an/an/an/aVanguard Inst Index0.0380.042-0.142Kennedy0.130-0.343-0.761TimesSquare2.2413.5223.125Morgan Stanley Intl Equity Fund2.8462.8453.037Morgan Stanley Emg Mkts Port.1.6503.1383.536Income Research1.7121.0251.024Penn Capital-0.470-0.271-0.677Loomis Credit Asset Fundn/an/a1.4251.76Brandywine Global Bond7.977.386.518Pictet Emg Mkts LCDn/an/an/an/an/an/aGMO Asset Allocation Fund0.3430.1300.118Pyramis Mkt Neutral-2.980-2.175-1.572PIMCO All Asset4.283.4130.842UBS Realty - Trumbull Prop Fund-1.4n/a-1.0n/a-1.1n/aWellington DIH (original benchmark) n/an/a-2.2n/a-5.4n/aWellington DIH (new benchmark)1.1n/a51
Manager Executive Summary – Gross of Fee AnalysisJune 30, 2013The Metropolitan St. Louis Sewer District Employees’ Pension Plan52
Manager Executive Summary – Gross of Fee AnalysisJune 30, 2013The Metropolitan St. Louis Sewer District Employees’ Pension Plan53
Manager Executive Summary – Gross of Fee AnalysisJune 30, 2013The Metropolitan St. Louis Sewer District Employees’ Pension PlanNote: Pictet is shown on a net of fee basis.54
Wellington Management Company•In April 2013, portfolio manager Ricardo Adrogue left the firm to pursue anotheropportunity. Jim Valone, the leader of the Emerging Markets Debt investment team, joinedthe DIH team and assumed lead portfolio management responsibilities for the EM ILBportfolios. Mr. Valone has led Wellington's Emerging Markets Debt team since its launch in1999. Additionally, TIPS manager Lindsay Politi will be supporting him, bringing herspecialization in inflation-linked bond investing.•There were changes to the Statement of Characteristics for Diversified Inflation Hedgeswhich included benchmark updates (as of July 1st). The complete text is included in theappendix.•NO ACTIONManager UpdatesThe Metropolitan St. Louis Sewer District Employees’ Pension PlanJune 30, 201355
Penn Capital Management Company•PENN Capital was initially hired by the Pension as a low risk conservative manager for highyield fixed income. PENN has fulfilled this objective. Performance has been slightly lowerthan the statement benchmark; however, Penn’s performance has lower volatility than itspeers.•Two analysts, David Neiderer and Jason Argyris, left PENN in the second quarter. They hadnot been with PENN long, David being hired in 2011 and Jason in 2012. The analystsfocused on the small cap equity strategy and the high yield service, respectively. Two newanalysts are slotted to join the firm, with a potential third ‘opportunistic’ hire in line aswell.PENN’s analysts cover both equity and fixed income research, and it is not uncommon, from time to time, to find their analysts seeking opportunities that will allow them to serve as ‘purists.’In spite of the departures, PENN considers its research facility deep enough to cover the departures. They also structure their research so that each sector is covered by two analysts. Taken together, PENN expects a smooth transition of coverage responsibility. •NO ACTIONManager UpdatesThe Metropolitan St. Louis Sewer District Employees’ Pension PlanJune 30, 201356
Holland Capital•In March 2013, Holland hired Christi Hausmann, a seasoned investment professional, to lead and direct the Portfolio Administration team as Manager – Portfolio Administration. Ms. Hausmann replaced Billie Mallie, who transitioned into the new role of Investment Data and Systems Specialist. As part of Holland’s 2013 growth plans, a new Portfolio Administrator, Adebayo Ashaye, was hired in late April.•Holland Capital made a strategic business decision to exit fixed income effective March 31. As a result, the last position associated with this segment of the business was eliminated: Janet Henry, Portfolio Manager/Sr. Fixed Income Analyst, departed the firm.•NO ACTIONManager UpdatesThe Metropolitan St. Louis Sewer District Employees’ Pension PlanJune 30, 201357
Manager Pages58
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Vanguard Windsor II
59
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Vanguard Windsor II
*The 3 Year Style Map is a returns-based graph
60
June 30, 2013
Top Holdings as of 03/31/2013
PFIZER INC 3.1%
PHILIP MORRIS INTERNATIONAL,
INC.2.9%
JOHNSON & JOHNSON 2.6%
AMERICAN EXPRESS CO 2.6%
JPMORGAN CHASE & CO 2.5%
MICROSOFT CORPORATION 2.3%
WELLS FARGO & CO 2.2%
BAXTER INTERNATIONAL INC.2.2%
PHILLIPS 66 2.1%
MEDTRONIC, INC.2.1%
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Vanguard Windsor II
Sector Allocation as of 03/31/2013
BASIC MATERIALS 1.7%
COMMUNICATION SERVICES 3.0%
CONSUMER CYCLICAL 6.4%
CONSUMER DEFENSIVE 10.5%
ENERGY 13.0%
FINANCIAL SERVICES 19.7%
HEALTHCARE 16.7%
INDUSTRIALS 10.1%
REAL ESTATE 0.2%
TECHNOLOGY 11.1%
Portfolio Fund Information as of 03/31/2013
Ticker VWNAX
Morningstar Category Large Value
Average Market Cap ($mm)53,141.8
Net Assets ($mm)23,787.4
% Assets in Top 10
Holdings 24.5
Total Number of Holdings 275
Manager Name James P. Barrow
Manager Tenure 28
Expense Ratio 0.3%
Closed to New Investors No
Fund Characteristics as of 03/31/2013
Sharpe Ratio (3 Year)
Average Market Cap ($mm)53,141.8
Price/Earnings 12.4
Price/Book 1.6
Price/Sales 1.2
Price/Cash Flow 6.3
Dividend Yield 2.8
Number of Equity Holdings 266
R-Squared (3 Year)
Alpha (3 Year)
61
The Metropolitan St. Louis Sewer District Employees' Pension Plan
T. Rowe Price
June 30, 2013
62
The Metropolitan St. Louis Sewer District Employees' Pension Plan
T. Rowe Price
June 30, 2013
Characteristics
Portfolio
Russell
1000
Growth
Number of Holdings 142 575
Weighted Avg. Market Cap. ($B)62.0 90.0
Median Market Cap. ($B)19.2 7.1
Price To Earnings 26.2 21.6
Price To Book 6.0 5.1
Price To Sales 4.0 3.0
Return on Equity (%)21.0 23.9
Yield (%)0.8 1.8
Beta 1.0
R-Squared 1.0
Top Positive Contributors
Relative
Contribution
%Return %
PRICELINE.COM 0.4%20.1%
APPLE 0.3%-9.8%
GOOGLE 'A'0.3%10.9%
PREC.CASTPARTS 0.3%19.2%
STARBUCKS 0.2%15.4%
TENCENT HOLDINGS 0.2%23.8%
MASTERCARD 0.1%6.3%
BIOGEN IDEC 0.1%11.7%
AMAZON.COM 0.1%4.2%
PVH 0.1%17.1%
_
Top Negative Contributors
Relative
Contribution
%Return %
FRANKLIN RESOURCES -0.2%-9.6%
ALLERGAN -0.1%-24.5%
SALESFORCE.COM -0.1%-14.6%
PHILLIPS 66 -0.1%-15.4%
FASTENAL -0.1%-10.4%
AMERICAN TOWER -0.1%-4.2%
HOME DEPOT -0.1%11.6%
QUALCOMM -0.1%-8.2%
LAS VEGAS SANDS -0.1%-5.5%
EBAY -0.1%-4.6%
_
Equity Sector Attribution
Attribution Effects Returns Sector Weights
Total Selection Allocation Interaction
Effects Effect Effect Effects Portfolio Benchmark Portfolio Benchmark
_
Energy 0.1%0.1%0.0%0.0%0.4%-1.6%5.3%4.3%
Materials 0.1%0.1%0.0%0.0%2.6%0.9%4.6%4.0%
Industrials 0.3%0.3%0.0%0.0%4.7%2.5%14.6%13.1%
Cons. Disc.0.3%0.0%0.3%0.0%7.3%7.3%23.2%16.7%
Cons. Staples 0.4%1.4%0.1%-1.1%11.8%1.1%2.8%12.7%
Health Care 0.1%0.1%0.0%0.0%3.5%3.1%13.7%12.5%
Financials 0.2%0.1%0.0%0.1%3.5%1.4%10.4%4.9%
Info. Tech 0.5%0.5%0.1%-0.1%1.0%-0.5%25.5%29.5%
Telecomm.0.0%--0.0%----3.7%0.0%2.3%
Utilities 0.0%--0.0%-----7.2%0.0%0.2%
Cash 0.0%0.0%0.0%0.0%0.0%--0.0%0.0%
Portfolio 1.9%=2.4%+0.5%+-0.9%4.0%2.0%100.0%100.0%
_
63
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Holland Capital
64
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Holland Capital
Equity Sector Attribution
Attribution Effects Returns Sector Weights
Total Selection Allocation Interaction
Effects Effect Effect Effects Portfolio Benchmark Portfolio Benchmark
_
Energy 0.2%0.2%0.0%0.0%1.1%-0.8%9.1%10.1%
Materials 0.2%0.2%-0.1%0.1%2.6%-2.7%4.9%3.9%
Industrials 0.0%0.0%0.0%0.0%1.7%2.1%8.9%11.4%
Cons. Disc.-0.1%-0.2%0.2%-0.1%5.6%7.4%16.1%12.4%
Cons. Staples 0.6%0.7%0.0%0.0%8.1%1.0%9.1%9.4%
Health Care 0.0%-0.1%0.0%0.0%3.5%4.0%14.9%12.0%
Financials -0.5%-0.8%-0.3%0.7%0.3%5.2%3.4%17.2%
Info. Tech -0.6%-0.2%-0.2%-0.2%0.2%1.4%33.6%17.5%
Telecomm.0.0%--0.0%----2.3%0.0%2.7%
Utilities 0.2%--0.2%-----2.1%0.0%3.5%
Cash 0.0%----------0.0%0.0%
Portfolio -0.1%=-0.3%+-0.2%+0.4%2.6%2.7%100.0%100.0%
_
June 30, 2013
Top Positive Contributors
Relative
Contribution
%Return %
VERTEX PHARMS.0.5%45.6%
MONSTER BEVERAGE 0.5%27.4%
CISCO SYSTEMS 0.4%17.4%
PRICELINE.COM 0.3%20.1%
VISA 'A'0.3%7.8%
OCCIDENTAL PTL.0.2%14.6%
GOOGLE 'A'0.2%10.9%
TD AMERITRADE HOLDING 0.2%18.3%
UNDER ARMOUR 'A'0.2%16.6%
GNC HOLDINGS CL.A 0.2%12.9%
_
Top Negative Contributors
Relative
Contribution
%Return %
CITRIX SYS.-0.7%-16.3%
QUALCOMM -0.3%-8.2%
COVIDIEN -0.2%-7.0%
RANGE RES.-0.2%-4.5%
GREENHILL & CO.-0.2%-13.5%
INTERNATIONAL BUS.MCHS.-0.2%-10.0%
BIOMARIN PHARM.-0.1%-10.5%
YUM! BRANDS -0.1%-3.1%
MICROS SYSTEMS -0.1%-5.2%
ROPER INDS.NEW 0.0%-2.3%
_
Characteristics
Portfolio Russell
3000
Number of Holdings 49 2,923
Weighted Avg. Market Cap. ($B)67.8 84.8
Median Market Cap. ($B)30.4 1.2
Price To Earnings 25.7 19.7
Price To Book 6.2 3.2
Price To Sales 3.8 2.3
Return on Equity (%)23.9 17.3
Yield (%)1.2 2.0
Beta 1.0
R-Squared 1.0
65
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Kennedy
66
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Kennedy
*The 3 Year Style Map is a returns-based graph
67
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Kennedy
Top Negative Contributors
Relative
Contribution
%Return %
AXIALL -0.7%-31.4%
REGAL BELOIT -0.4%-20.3%
TRINITY INDS.-0.3%-15.0%
DENBURY RES.-0.1%-7.1%
STEEL DYNAMICS -0.1%-5.4%
WHITING PTL.-0.1%-9.3%
AGCO -0.1%-3.5%
HOST HOTELS & RESORTS 0.0%-2.9%
ON SEMICON.0.0%-2.4%
WESTAR EN.0.0%-2.6%
_
Top Positive Contributors
Relative
Contribution
%Return %
HARMAN INTL.INDS.0.4%21.8%
HOSPIRA 0.3%16.7%
REGIONS FINL.NEW 0.3%16.7%
REINSURANCE GROUP OF AM.0.3%16.3%
OIL STS.INTL.0.2%13.6%
ST.JUDE MEDICAL 0.2%13.5%
TORCHMARK 0.2%9.2%
KEYCORP 0.2%11.4%
JABIL CIRCUIT 0.2%10.7%
NETAPP 0.2%10.8%
_
Equity Sector Attribution
Attribution Effects Returns Sector Weights
Total Selection Allocation Interaction
Effects Effect Effect Effects Portfolio Benchmark Portfolio Benchmark
_
Energy 0.7%0.7%-0.2%0.2%0.1%-7.6%11.8%9.3%
Materials -0.4%-0.2%-0.1%-0.1%-8.5%-4.6%7.5%6.0%
Industrials -1.0%-0.9%0.0%-0.1%-6.3%1.4%13.1%11.4%
Cons. Disc.-0.1%0.1%0.0%-0.1%6.6%6.9%8.6%9.4%
Cons. Staples 0.1%0.2%0.0%-0.1%3.7%-0.3%2.2%4.6%
Health Care 0.3%0.2%0.1%0.0%9.1%6.6%8.5%7.0%
Financials 1.3%1.6%0.0%-0.3%7.3%2.1%25.1%30.5%
Info. Tech 0.2%0.1%0.1%0.0%6.7%5.5%12.4%10.4%
Telecomm.-0.3%---0.3%----23.7%0.0%1.3%
Utilities -0.1%-0.1%0.0%0.0%-1.3%-0.4%10.8%10.1%
Cash 0.0%----------0.0%0.0%
Portfolio 0.7%=1.7%+-0.5%+-0.5%2.5%1.7%100.0%100.0%
_
Characteristics
Portfolio
Russell
MidCap
Value
Number of Holdings 53 563
Weighted Avg. Market Cap. ($B)6.9 9.7
Median Market Cap. ($B)5.4 4.6
Price To Earnings 16.0 18.1
Price To Book 2.0 2.0
Price To Sales 1.7 1.6
Return on Equity (%)12.2 10.5
Yield (%)1.6 1.9
Beta 1.1 1.0
R-Squared 1.0 1.0
68
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
TimesSquare Small Cap Growth Fund
69
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
TimesSquare Small Cap Growth Fund
*The 3 Year Style Map is a returns-based graph
70
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
TimesSquare Small Cap Growth Fund
Top Positive Contributors
Relative
Contribution
%Return %
HARTFORD FINL.SVS.GP.0.3%20.2%
WAGEWORKS 0.3%37.6%
KOHL'S 0.2%10.2%
APACHE 0.2%9.0%
PENNEY JC 0.2%13.0%
QUEST DIAGNOSTICS 0.2%7.9%
MONRO MUFFLER BRAKE 0.2%21.3%
INFOBLOX 0.2%34.8%
ANGIE'S LIST 0.2%34.4%
ARTISAN PTNS.ASTMGMT.0.2%26.5%
_
Top Negative Contributors
Relative
Contribution
%Return %
INCITEC PIVOT -0.2%-17.8%
VOCERA COMMUNICATIONS -0.2%-36.1%
CLEAN HARBORS -0.2%-13.0%
AIR METHODS -0.2%-29.8%
EBIX -0.2%-42.9%
KEY ENERGY SVS.-0.1%-26.4%
BOTTOMLINE TECHS.-0.1%-11.3%
NIC -0.1%-13.7%
EXLSERVICE HDG.-0.1%-10.1%
GENESEE & WYOMING 'A'-0.1%-8.9%
_
Equity Sector Attribution
Attribution Effects Returns Sector Weights
Total Selection Allocation Interaction
Effects Effect Effect Effects Portfolio Benchmark Portfolio Benchmark
_
Energy 0.4%0.4%-0.3%0.3%3.4%-3.0%9.8%5.8%
Materials 0.3%0.4%0.1%-0.2%-1.8%-7.0%4.6%5.1%
Industrials 0.8%0.8%-0.1%0.1%5.1%0.6%19.9%18.0%
Cons. Disc.-0.3%-0.2%-0.1%0.0%8.5%9.5%13.8%15.7%
Cons. Staples -0.2%-0.2%0.1%-0.1%3.7%8.9%5.8%4.6%
Health Care -0.6%-0.7%-0.1%0.3%1.7%5.4%13.1%20.3%
Financials 0.9%1.0%0.0%-0.1%11.7%-0.4%7.4%8.0%
Info. Tech -0.2%-0.2%0.0%0.0%3.5%4.5%25.5%21.4%
Telecomm.-0.1%-0.2%0.0%0.1%-14.6%8.6%0.2%0.8%
Utilities 0.0%--0.0%-----2.2%0.0%0.3%
Cash 0.0%----------0.0%0.0%
Portfolio 1.0%=1.0%+-0.4%+0.4%4.6%3.6%100.0%100.0%
_
Characteristics
Portfolio
Russell
2000
Growth
Number of Holdings 107 1,101
Weighted Avg. Market Cap. ($B)2.1 1.8
Median Market Cap. ($B)1.6 0.7
Price To Earnings 32.4 24.9
Price To Book 4.3 4.1
Price To Sales 3.1 2.7
Return on Equity (%)15.5 16.2
Yield (%)0.4 0.5
Beta 0.9 1.0
R-Squared 1.0 1.0
71
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Morgan Stanley Int'l Equity Fund
72
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Morgan Stanley Int'l Equity Fund
73
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Morgan Stanley Int'l Equity Fund
Top Positive Contributors
Relative
Contribution
%Return %
MITSUBISHI ELECTRIC 0.2%16.2%
SUMITOMO MITSUI FINL.GP.0.2%14.1%
NGK SPARK PLUG 0.1%30.9%
SANOFI 0.1%5.1%
TOYOTA MOTOR 0.1%16.7%
RESOLUTION 0.1%10.3%
UBS 'R'0.1%11.6%
KYOCERA 0.1%8.5%
ROCHE HOLDING 0.1%6.4%
BAYER 0.1%5.5%
_
Top Negative Contributors
Relative
Contribution
%Return %
INPEX -0.3%-21.6%
WORLEYPARSONS -0.3%-30.7%
NESTLE 'R'-0.2%-6.9%
BRITISH AMERICAN TOBACCO -0.2%-4.6%
SANTOS -0.1%-11.5%
UNILEVER CERTS.-0.1%-3.4%
AMP -0.1%-28.4%
HOLCIM 'R'-0.1%-11.4%
SAP -0.1%-7.9%
ENCANA (NYS)-0.1%-12.0%
_
Equity Sector Attribution
Attribution Effects Returns Sector Weights
Total Selection Allocation Interaction
Effects Effect Effect Effects Portfolio Benchmark Portfolio Benchmark
_
Energy -0.7%-0.4%-0.1%-0.3%-10.9%-3.1%8.6%7.2%
Materials 0.2%-0.2%0.1%0.3%-7.5%-8.1%6.7%8.5%
Industrials 0.6%0.6%0.0%0.0%4.9%-1.3%6.8%12.6%
Cons. Disc.0.1%0.9%-0.4%-0.4%11.2%5.7%5.2%11.0%
Cons. Staples -0.6%-0.1%-0.6%0.1%-3.6%-4.4%25.2%12.4%
Health Care 0.3%0.2%0.0%0.2%3.7%0.9%13.1%10.4%
Financials 0.8%0.5%0.0%0.4%2.4%-0.9%18.9%24.9%
Info. Tech 0.1%0.1%0.1%-0.1%2.3%1.4%6.1%4.4%
Telecomm.-0.2%-0.2%0.0%0.0%2.0%5.2%4.7%4.9%
Utilities -0.1%-0.1%-0.1%0.1%2.5%4.0%1.8%3.7%
Cash 0.0%0.0%0.0%0.0%0.0%--2.9%0.0%
Portfolio 0.4%=1.3%+-1.0%+0.2%-0.2%-0.7%100.0%100.0%
_
Characteristics
Portfolio MSCI EAFE
Number of Holdings 77 908
Weighted Avg. Market Cap. ($B)73.4 54.5
Median Market Cap. ($B)22.7 7.6
Price To Earnings 20.1 17.5
Price To Book 3.2 2.1
Price To Sales 1.9 1.7
Return on Equity (%)18.7 13.5
Yield (%)3.2 3.2
Beta 0.9 1.0
R-Squared 1.0 1.0
74
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Morgan Stanley Inst Emg Mkt Port.
75
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Morgan Stanley Inst Emg Mkt Port.
76
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Morgan Stanley Inst Emg Mkt Port.
Portfolio Fund Information as of 03/31/2013
Ticker MGEMX
Morningstar Category Diversified Emerging
Mkts
Average Market Cap ($mm)14,510.7
Net Assets ($mm)1,181.3
% Assets in Top 10
Holdings 18.3
Total Number of Holdings 180
Manager Name Paul C. Psaila
Manager Tenure 19
Expense Ratio 1.3%
Closed to New Investors No
Top Holdings as of 03/31/2013
SAMSUNG ELECTRONICS
CO LTD 4.6%
TAIWAN SEMICONDUCTOR
MANUFACTURING CO LTD 1.9%
BRF SA 1.8%
WAL - MART DE MEXICO,
S.A.B. DE C.V. CLASS V 1.6%
HYUNDAI MOTOR CO LTD 1.5%
COMPANHIA DE BEBIDAS
DAS AMERICAS AMBEV ADR 1.5%
ANADOLU EFES BIRACILIK
VE MALT SANAYI A.S.1.4%
TURKIYE GARANTI BANKASI 1.4%
CREDICORP LTD 1.4%
BANK OF CHINA LTD. H
SHARES 1.3%
Sector Allocation as of 03/31/2013
BASIC MATERIALS 8.4%
COMMUNICATION
SERVICES 4.4%
CONSUMER CYCLICAL 10.8%
CONSUMER DEFENSIVE 13.9%
ENERGY 6.6%
FINANCIAL SERVICES 19.1%
HEALTHCARE 3.1%
INDUSTRIALS 7.5%
REAL ESTATE 2.4%
TECHNOLOGY 13.2%
UTILITIES 0.4%
Top Regions as of 03/31/2013
ASIA EMERGING 33.8%
ASIA DEVELOPED 18.2%
LATIN AMERICA 15.7%
EUROPE EMERGING 10.8%
EUROZONE 3.4%
Top Countries as of 03/31/2013
South Korea 11.7%
China 10.5%
India 7.5%
Taiwan 6.5%
Mexico 6.0%
Brazil 5.8%
Thailand 5.3%
Philippines 4.8%
Turkey 4.1%
Fund Characteristics as of 03/31/2013
Sharpe Ratio (3 Year)0.4
Average Market Cap
($mm)14,510.7
Price/Earnings 13.9
Price/Book 2.0
Price/Sales 0.9
Price/Cash Flow 5.2
Dividend Yield 1.8
Number of Equity Holdings 157
R-Squared (3 Year)1.0
Alpha (3 Year)0.3%
77
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Income Research
78
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Income Research
*The 3 Year Style Map is a returns-based graph
79
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Income Research
80
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Penn Capital
81
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Penn Capital
*The 3 Year Style Map is a returns-based graph
82
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Penn Capital
83
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Loomis Credit Asset Fund
84
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Loomis Credit Asset Fund
*The 2 Year Style Map is a returns-based graph
85
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Brandywine Global Bond
86
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Brandywine Global Bond
*The 3 Year Style Map is a returns-based graph
87
June 30, 2013
The Metropolitan St. Louis Sewer District Employees' Pension Fund
Pictet Emerging Debt
88
June 30, 2013
Style Map: Analytic is based on historical performance returns.
The Metropolitan St. Louis Sewer District Employees' Pension Plan
Pictet Emerging Debt
89
GMO (Global Asset Allocation)Historical AllocationAsset AllocationJune 30, 2013The Metropolitan St. Louis Sewer District Employees’ Pension PlanSource: GMO90
Market Neutral - PyramisThe Metropolitan St. Louis Sewer District Employees’ Pension PlanJune 30, 201391
PIMCO All AssetJune 30 , 2013The Metropolitan St. Louis Sewer District Employees’ Pension PlanSource: PIMCO92
UBS Trumbull Property FundJune 30, 2013The Metropolitan St. Louis Sewer District Employees’ Pension PlanPortfolio Distribution by Property TypeKey StatisticsDistribution by Geographic DivisionSource: UBS Realty Investors93
Wellington Diversified Inflation HedgesJune 30, 2013The Metropolitan St. Louis Sewer District Employees’ Pension PlanActive Portfolio weightsAttribution Chart Asset Class Allocation SummarySource: Wellington94
Appendix95
Memorandum Wellington Trust Company, na To: Participants in the CIF Diversified Inflation Hedges Portfolio From: Wellington Trust Company, na Re: Statement of Characteristics Update Date: May 16, 2013 Update We are writing to announce changes to the Statement of Characteristics for
CIF Diversified Inflation Hedges (DIH), which include benchmark updates
and the incorporation of language clarifying return variability and asset class
inclusion versus each benchmark.
The changes will be effective July 1, 2013. No action on your part is required.
Background
Nearly a decade ago when we launched our first multi-asset inflation hedging
solution, Real Asset, we created a dual objective of investing in asset classes
that outperform during rising inflationary environments while meeting a
long-term goal of CPI+5%. We maintained this dual objective when we
launched DIH. As a way of measuring security selection and tactical asset
allocation decisions, we created a dynamic, custom benchmark that
incorporated each underlying portfolio’s benchmark, weighted by its strategic
allocation within the portfolio. This custom benchmark has evolved to reflect
these strategic changes made by the Asset Allocation team.
Over time it has become clear that this custom benchmark structure results in
two significant problems:
•The value-added of these strategic changes was not being explicitly
measured, as any strategic value added was embedded in the custom
benchmark. The Asset Allocation team views these strategic decisions as
their primary source of value-added and efforts to measure this positive
effect have resulted in often complex and time-consuming conversations.
•An evolving benchmark comprised of multiple underlying custom
components is inherently complex. This complexity grows over time as the
benchmark shifts, creating confusion and frustration for clients and
consultants.
Rationale for Change
To address these concerns, we have established a new primary benchmark for
DIH. The Multi-Asset Inflation Index (MAII) is a simple, static, transparent
blend of natural resource equity, commodity, and inflation-linked bond
indexes. The MAII is comprised of: 50% MSCI ACW Commodity Producers
Index, 25% Dow Jones UBS Commodity Index, and 25% Barclays US TIPS 1-
10 Year Index. The MSCI ACW Commodity Producers Index includes
exposure to energy, metals, and agriculture equities. All are readily available
and do not involve customization. 96
Statement of Characteristics Update May 16, 2013 Page 2 The new benchmark is representative of both the opportunity set and the
volatility profile of DIH and will facilitate comparisons against passive
investible alternatives. As the portfolio evolves, the MAII will remain static,
allowing for the measurement of all three drivers of performance: strategic
allocation, tactical allocation, and security selection.
We acknowledge that there is never an ideal time to make a benchmark
change. We also understand that due to our success in making strategic
changes over most periods, our performance comparisons are more favorable
against the new benchmark than the old custom benchmark. This can cut
both ways as strategic decisions can also work against us.
In addition to now reporting strategic value-added, we will also continue to
report attribution at a security-selection and tactical-allocation level. This
change is consistent with client/consultant desire for a clear, understandable
static benchmark, and now allows for measurement of a key component of
value-added. We believe that it will allow us to refocus our conversations
back to the portfolio and its primary objective of hedging inflation risk.
CPI+5% will remain a long-term objective for DIH, but will now be listed as a
secondary benchmark. When DIH was first designed, the CPI +5%
benchmark was meant as an analog to a strategic return objective given the
mix of assets we invest in, while aligning with client objectives when seeking
to hedge inflationary risk. However, CPI+5% is an un-investable benchmark
with a volatility profile vastly different from investable solutions designed to
achieve it. As a result, CPI+5% has created additional confusion, especially
when measuring shorter-term performance. The new MAII benchmark is a
better representation of the actual opportunity set and portfolio risk profile.
We look forward to discussing this with you. In the interim, please feel free
to call your relationship manager to address any questions. 97
" T h e s e m a t e r i a l s c o n t a i n s u m m a r y i n f o r m a t i o n r e g a r d i n g t h e i n v e s t m e n t m a n a g e m e n t a p p r o a c h e s d e s c r i b e d h e r e i n a n d a r e n o t a c o m p l e t e d e s c r i p t i o n o f t h e i n v e s t m e n t o b j e c t i v e s , p o l i c i e s , g u i d e l i n e s o r p o r t f o l i o m a n a g e m e n t a n d r e s e a r c h t h a t s u p p o r t s t h e s e a p p r o a c h e s . T h i s a n a l y s i s d o e s n o t c o n s t i t u t e a r e c o m m e n d a t i o n t o i m p l e m e n t a n y o f t h e a f o r e m e n t i o n e d a p p r o a c h e s . T h e i n f o r m a t i o n h a s b e e n o b t a i n e d f r o m s o u r c e s N E P C b e l i e v e s t o b e r e l i a b l e , b u t w e c a n n o t g u a r a n t e e i t s a c c u r a c y o r c o m p l e t e n e s s . " P a s t p e r f o r m a n c e i s n o g u a r a n t e e o f f u t u r e r e s u l t s . " N E P C r e s e a r c h r e p o r t s m a y c o n t a i n c o n f i d e n t i a l o r p r o p r i e t a r y i n f o r m a t i o n a n d a r e i n t e n d e d o n l y f o r t h e d e s i g n a t e d r e c i p i e n t ( s ) . I f y o u a r e n o t a d e s i g n a t e d r e c i p i e n t , y o u m a y n o t c o p y o r d i s t r i b u t e t h i s d o c u m e n t . I n f o r m a t i o n D i s c l o s u r e 9 8