Global Emerging Markets Equity

2nd Quarter 2008

Four Embarcadero Center, San Francisco, CA 94111 T:(415) 954-5400

RCM Homepage

Overview

RCM’s Global Emerging Markets strategy aims to achieve long-term capital growth through investment in the shares of companies that are either domiciled in emerging markets or that generate a major proportion of their earnings there. To achieve this objective, country allocation is combined with a bottom-up security selection process and a benchmark optimization risk control process designed to maximize returns and reduce volatility.

Investment Process

• A proprietary country scoring system drives the top-down country allocation process and incorporates macro and equity market indicators for 24 countries.
• Working in a team-oriented meritocracy, our investment professionals focus on constructing portfolios offering attractive risk-adjusted returns.

The RCM Advantage

• Innovative dual research platform – producing bottom-up stock selection:
  • Fundamental research analysts specialize in their sector of expertise
  • Proprietary Grassroots^SM Research* network with 50,000 industry contacts and approximately 300 independent reporters and field force investigators
• Institutionalized investment culture
• Consultative client relationships

Performance**

Supplemental Information:

Representative Account Characteristics^† ; Sources: 1 APT 2 Style Research 3 Wilshire Data of Style Research refer to Global Emerging Markets Equity; other data refer to the representative account

Beta 0.9 P/E (Next 12 Mo. EPS) 15.8x Earnings Growth (Next 3-5 yrs) 34.7% P/E (Next 12 Mo.) to Growth (Next 3-5 yrs) 0.5x Wgtd Avg Market Cap US$37.9 billion Number of Holdings 93

Top Ten Holdings Gazprom                 3.1% Teva Pharmaceutical Ind 3.0% Icl-Israel Chemicals    2.6% Petroleo Brasileiro Sa  2.0% Credicorp                1.9% America Movil Sab De Cv 1.7% China Mobile Ltd        1.7% USINAS Sid Minas Gerais 1.6% Industrial & Commercial 1.5% Novolipetsk Steel       1.5%

Sector Composition (% of Portfolio and Benchmark)^† - Supplemental Information

Country Composition (% of Portfolio and Benchmark)^† - Supplemental Information

Performance Composite Statistics

Period	Composite Gross Return (%)	Composite Net Return (%)	MSCI Emerging Market Index Return	Composite Dispersion (%)	No. of Accounts	Period-End Total Assets (US$ M)	Total Firm Assets ($ M)
2007	38.53	35.90	39.78	2.28	13	833	168,131
2006	42.34	40.35	32.59	0.98	11	530	164,876
2005	31.07	30.12	34.54	0.02	6	298	147,527
2004	26.13	25.94	25.95	n/a♦	2	91	128,432
2003	76.06	74.94	56.28	n/a♦	2	71	123,142

*Grassroots^SM Research is a division of RCM.  Research data, used by Grassroots^SM Research to generate recommendations, are received from reporters and field force investigators who work as independent contractors for broker-dealers. These broker-dealers supply research to RCM and certain of its affiliates in connection with brokerage services that is paid for by commissions generated by orders executed on behalf of RCM's clients.

 

** Past performance is no guarantee of future results. Individual performance will vary. Performance results and valuations are presented in U.S. dollars, Gross returns were calculated on a total return basis, including all dividends and interest, accrued income, realized and unrealized gains or losses, are net of all commissions and execution coasts, and do not give effect to investment advisory fees which would reduce such returns. Net returns were calculated on a total return basis, including all dividends and interest, accrued income, realized and unrealized gains or losses, and are net of all brokerage commissions, execution cost, and investment advisory fees. Some of our composites may contain single asset segments that are carved out of multiple-asset portfolios. Multiple asset portfolio cash flows are allocated to the carve-out segments pro-rata.

 

^†   The Representative Account information is for illustrative purposes only and reflects one account within the composite. Rounding may cause figures to vary from 100%. Portfolio holdings and sector composition are subject to change without notice and should not be considered a recommendation of any particular securities or investment strategy. The supplemental information above complements the GIPS® compliant presentation on the following page.

 

♦ Standard deviation is not considered statistically meaningful when there are fewer than five accounts in the composite during the period.

 

RCM (the “Firm”) is a global investment advisory organization, consisting of separate affiliated firms, which operates under the brand name RCM. The affiliated firms that comprise the Firm include, among others, RCM Capital Management LLC (“RCM Capital”), an investment advisory firm registered with the Securities and Exchange Commission, which has been in operation since 1970, either directly or through its predecessors. RCM Capital presents the Global Emerging Markets strategy in the United States. RCM has prepared and presented this report in compliance with the Global Investment Performance Standards (GIPS®). To obtain a list and description of all of the Firm’s composites, please call 415-954-5400 or write to RCM, Four Embarcadero Center, Suite 3000, San Francisco, CA 94111. For the periods ended December 31, 1998, 1999 and 2000, the composite presentation does not comply fully with GIPS, because RCM has not been able to confirm the total firm assets for those periods.

 

The composite was created in September 2003 and contains all actual fee-paying, discretionary Global Emerging Markets portfolios. The MSCI Emerging Markets Index is a free float-adjusted market capitalization index that is designed to measure equity market performance of emerging markets. As of June 2007 the MSCI Emerging Markets Index consisted of the following 25 emerging market country indices: Argentina, Brazil, Chile, China, Columbia, Czech Republic, Egypt, Hungary, India, Indonesia, Israel, Jordan, Korea, Malaysia, Mexico, Morocco, Pakistan, Peru, Philippines, Poland, Russia, South Africa, Taiwan, Thailand, and Turkey. Unless otherwise noted, index returns are presented as total returns, which reflect both price performance and income from dividend payments, if any, but do not reflect fees, brokerage commissions or other expenses of investing.

 

Composite performance is net on any applicable withholding taxes on dividends, interest income and capital gains. Returns include the effect of foreign currency exchange rates. The dispersion of annual returns is measures by the standard deviation across equal-weighted account returns represented within the composite for the full year. Additional information regarding policies for calculating and reporting returns is available upon request. Our standard fee for this product is as follows: 0.75% annually on the first $35,000,000, 0.60% annually on the next $70,000,000 and 0.55% annually on sums exceeding $140,000,000, and with a minimum fee of $200,000. Actual fees may vary depending on, among other things, the type of client and the amounts of assets are management. Advisory fees are described in Part II of RCM Capital’s Form ADV.

 

 

All data as of June 30, 2008, unless otherwise noted.