For institutional use and registered representative use only ......For Institutional client and registered representative use only. Not for public viewing and distribution. MARKETS

For institutional use and registered representative use only. Not for public viewing or distribution. Investment products: No bank guarantee I Not FDIC insured I May lose value.

CIO VIEWStefan Kreuzkamp

CIO & Co-Head Investment Group

For institutional use and registered representative use only. Not for public viewing or distribution. Investment products: No bank guarantee I Not FDIC insured I May lose value.

For Institutional client and registered representative

use only. Not for public viewing and distribution.

MARKETS – FROM PANIC TO EUPHORIA IN 6 MONTHS

CIO View / Stefan Kreuzkamp / May 2019 / 3

1) Citi Global Risk Aversion Macro Index. Current risk aversion is around levels from beginning to mid of 2018 / Past performance is not a reliable indicator of future returns.

Sources: Bloomberg Finance L.P., DWS Investment GmbH as of May 2019

15%17%

5%

19%

8%

3%

S&P 500 DAX MSCI EM NASDAQ US-HY 10Y.

BUNDS

-14% -14%

-8%

-18%

-5%

2%S&P 500 DAX MSCI EM NASDAQ US-HY

10Y.

BUNDS

Q4 2018 I THE YEAR ENDED NOT SO WELL

2019 YTD I WHAT A CHANGE!

STRONGEST REBOUND

SINCE FINANCIAL CRISIS

RISK AVERSION FALLING

FROM END-2018 LEVELS1

VOLATILITY DOWN TO

LEVELS OF MID-2018

Q1 2019



WHAT TRIGGERED THE SHARP REBOUND?


MARKET PERCEPTION HAS CHANGED IN TERMS OF:

Forecasts are not a reliable indicator of future returns. Forecasts are based on assumptions, estimates, opinions and hypothetical models or analysis which may prove to be incorrect.

Source: DWS Investment GmbH as of May 2019

TRADE CENTRAL BANKS CORPORATES ECONOMY

Fed signals to stay

market friendly

(no rate hikes)

Constructive

discussions in

US / China trade

conflict

Mixed Q1 results,

but earnings

forecasts stabilizing

Slowdown less

severe than

feared



GLOBAL ECONOMY – SLOWING BUT GROWING


WEAKER DATA, BUT NO RECESSION IN SIGHT

1) DWS forecasts for 2019. 4Q/4Q U.S. GDP growth. For 2019 calendar year 2019 = 2.6% / Forecasts are not a reliable indicator of future returns. Forecasts are based on assumptions, estimates, opinions and

hypothetical models or analysis which may prove to be incorrect. Source: DWS Investment GmbH as of May 2019

CHINAStabilization of GDP growth after fiscal & monetary stimulus

U.S.Soft landing, inflation well anchored (2%), tight labor market

EUROZONETrade conflict weighs on growth (especially core Europe), but

consumer sentiment stays healthy, inflation below ECB target

+2.2%

+1.2%

+6.2%

GDP GROWTH 20191

GLOBAL ECONOMYNo recession expected: Lower growth & inflation expectations+3.5%

VS 2018



MONETARY POLICY – REMAINS SUPPORTIVE




NO NEW BOND PURCHASES_ But reinvestment of expiring bonds

_ No rate hikes expected until 2020

_ Financing costs remain low

RATE-HIKE CYCLE ALMOST DONE_ Low rates, given stage of cycle

_ Fed on pause: no rate hike expected

_ Policy “data dependent”

FEDMarket expectations:

-6 MONTHS

ONE HIKEFed funds rate (1/2020)

CURRENT

ONE CUTFed funds rate (1/2020)

ECBMarket expectations:

-6 MONTHS

ONE HIKEEONIA future rate (1/2020)

CURRENT

NO HIKESEONIA future rate (1/2020)



WHAT COULD END THE RECORD CYCLE?




PO

LIT

ICA

L R

ISK

SM

AR

KE

T R

ISK

S

TRADE CONFLICTNo trade deal between

U.S./China

CB INDEPENDENCE

IN DOUBTIn case investors view the Fed

as politically driven

EUROPE (ITALY)High uncertainty: Italy’s budget &

future political leadership in

Europe

CREDIT-MARKET

TENSIONSGlobal hunt for yield driven by

QE & negative rates

U.S. CONSUMER GETS

TIREDRates on credit cards & auto

loans have risen

GEOPOLITICAL

ESCALATIONSIran, North-Korea



U.S. – OPTIONS IN A DOWNTURN SCENARIO


LESS ROOM IN NEXT DOWNTURNDecline in percentage points

8.25

10.5011.50

6.75

5.505.00

1974-1976 1980-1980 1981-1983 1989-1993 2000-2003 2007-2009

Decline in fed funds rate in response to recession

POSSIBLE OPTIONS BY ESCALATION LEVEL



QE: QUANTITATIVE EASING First option when fed funds reach zero bound

FED FUNDS RATE CUTRelatively low scope compared to past cycles

QE+: YIELD-CURVE CONTROLTargeting yield levels via QE

HISTORICAL MEDIAN

CURRENT LEVEL: 2.50%



EUROZONE – TOOLBOX ALMOST EMPTY


ECB: ESTIMATED PSPP OWNERSHIP1

% of eligible universe

Italy Germany Spain Ireland Portugal France

POSSIBLE OPTIONS BY ESCALATION LEVEL

1) DWS estimations. PSPP: Public Sector Purchase Programme 2) Targeted longer-term refinancing operations / Forecasts are not a reliable indicator of future returns. Forecasts are based on assumptions,

estimates, opinions and hypothetical models or analysis which may prove to be incorrect. Sources: European Central Bank, DWS Investment GmbH as of May 2019

QUANTITATIVE EASINGPossibly with altered issuer limits &

expanded asset classes

POLICY RATESCut deposit rate after introducing tiering system

CREDIT EASINGTLTRO2, measures to mitigate the costs of

ultra-low rates for banks

33%ISSUE LIMIT THRESHOLD

18%

33%

25%21% 21% 21%



Fed: Data

dependent

ECB: Dovish

Slowing, but no

recession in

2019/20 expected

Low inflation

expectations, no

fear of overheating

Trade conflict

European politics

Market excesses

SUMMARY: NO RECESSION IN SIGHT




ECONOMY INFLATION CENTRAL BANKS RISKS



STRENGTHEN STABILITY

BONDS & REAL ESTATE



2.0 2.2

1.11.5

2.12.5

-1.1

2.4

4.5

GDP growth <1% GDP growth 1%-3% GDP growth >3%

U.S. investment grade U.S. high yield S&P 500

≤ 3% GDP GROWTH

= GOLDILOCKS FOR IG

U.S. SHORT DURATION & CORPORATE CREDIT


2-Y. TREASURIES: BEST RISK-ADJ. RETURN%

0

1

2

3

4

5

2007 2009 2011 2013 2015 2017 2019

2-year U.S. Treasuries yield S&P 500 dividend yield

1) Real quarter-over-quarter U.S. GDP growth / Past performance is not a reliable indicator of future returns. Forecasts are not a reliable indicator of future returns. Forecasts are based on assumptions,

estimates, opinions and hypothetical models or analysis which may prove to be incorrect. Sources: Bloomberg Finance L.P., DWS Investment GmbH as of May 2019

Average quarterly total return in %, since 1990

IG BONDS: PREPARE FOR LOWER GROWTH1

2-Y. UST YIELD > DIVIDEND YIELD



VALUE FOR MONEY: ASIAN CORPORATE BONDS

/ 13

1) Yield to maturity for Bank of America Merrill Lynch 5-7 Year Corporates Indices. U.S. and Asia in dollars, Europe in euros 2) Current %-share of bonds in default of payment of the outstanding bond volume /

Forecasts are based on assumptions, estimates, opinions and hypothetical models or analysis which may prove to be incorrect. Sources: Bloomberg Finance L.P., DWS Investment GmbH as of May 2019

HIGH-YIELD DEFAULT RATES2LIQUIDITYYIELD1

1.1%

3.5%

4.3%

ASIAU.S.

ASIA

U.S.

$250Bn.New issues in 2018

EUROPE

EUROPE

1.0%

1.9%

0.4%

QUALITY (SHARE OF IG)

80%

CIO View / Stefan Kreuzkamp / May 2019



PREFERRED BOND SUBSTITUTE: U.S. REAL ESTATE


U.S.: Ø TOTAL RETURN 2019-23 FORECAST1 FUNDAMENTALS IN GOOD SHAPE

1 DWS Ø total-return expectations in % p.a., annualized, distribution by city / Forecasts are based on assumptions, estimates, opinions and hypothetical models or analysis which may prove to be incorrect.


City distribution, Ø total return (min – max)

APART-

MENT

4.8%

INDUSTRY

6.6%

RETAIL

4.5%

OFFICE

4.7%

RENTAL MARKETSPositive economic backdrop supports demand & vacancy reduction

OUTLOOKIlliquidity premium attractive (over 10-year Treasuries)

SECTOR VIEWFocus on industrial (logistics) that benefit from e-commerce driven demand



SEIZE OPPORTUNITIES

HIGHER RETURNS

POSSIBLE WITH EQUITIES



POSITIVE 12-MONTH RETURN EXPECTATIONS


2019: PRICE-EARNINGS (P/E) RATIO1

Current price-earnings ratio, LTM

17.7

15.2

14.3

13.1

16.0

U.S. Europe Germany EM

2019 (current) U.S. average since 1960

1) U.S.: S&P 500, Europe: Stoxx 600, Germany: Dax, EM: MSCI Emerging Markets Index / 2) P/E average = 16 for U.S. equities since 1960 / Forecasts are based on assumptions, estimates, opinions and

hypothetical models or analysis which may prove to be incorrect. Sources: FactSet Research Systems Inc., DWS Investment GmbH as of May 2019

FAIR S&P 500 P/E LEVELS Should be above hist. average2 because of low

interest rates

LONGER-TERM POSITIVE RETURNSThrough dividends & mid single-digit EPS growth

-14% -19% -25%vs. U.S.

“ROW” REMAINS AT DISCOUNT TO U.S.Lower IT-share, lower profitability & higher cyclicality

NEAR-TERM DOWNSIDE RISKSStrong year-to-date rally and trade concerns



NO EARNINGS RECESSION IN 2019


BETTER U.S. EARNINGS GROWTH IN H2 20191

S&P 500 year-over-year earnings-per-share (EPS) growth

2% 2%

5%

7%

Q1 2019 F Q2 2019 F Q3 2019 F Q4 2019 F

1) F = DWS forecast / Forecasts are based on assumptions, estimates, opinions and hypothetical models or analysis which may prove to be incorrect.

Sources: FactSet Research Systems Inc., DWS Investment GmbH as of May 2019

H1: FX, OIL, SEMI

CONDUCTORS

DAMPEN

H2: H1 HEADWINDS

FADE

2019 EPS GROWTHF

SOLID EARNINGS SEASON_ Companies meet lowered expectations

_ Stabilizing EPS revisions in U.S. & Pan-Europe

TRADE CONFLICT TAKES ITS TOLLNegative impact of -3% on S&P 500 EPS growth

-3%

OVERWEIGHT STOCKS WITH:_ Attractive growth: U.S. large caps

(Software & communication)

_ Attractive valuation: Global financials (U.S. large banks & Asian insurances)

_ Upside potential: Emerging-markets equities(Asia preferred)

-3%



SELECTIVE RISK-TAKING IN EM EQUITIES


EMERGING MARKETS: COUNTRY SELECTION IS KEY1

Total return in USD, %

Brazil

Brazil

RussiaBrazil

India Russia

China

Indonesia

Turkey

South Africa

Turkey

Russia

Brazil

China

IndiaRussia

-60%

-40%

-20%

0%

20%

40%

60%

80%

2012 2013 2014 2015 2016 2017 2018 2019 ytd

Country range (max - min) Emerging markets

1) MSCI Indices for: Emerging Markets, China, India, Brazil, Turkey, Thailand, Taiwan, South Africa, Korea, Indonesia, Russia, Thailand / Past performance is not a reliable indicator of future returns. Forecasts

are based on assumptions, estimates, opinions and hypothetical models or analysis which may prove to be incorrect. Sources: Bloomberg Finance L.P., DWS Investment GmbH as of May 2019

FURTHER UPSIDE POTENTIALImproving Chinese economy & pickup in

2020 earnings expected, especially for

China & Brazil

HEADWINDS FADINGLess U.S. dollar strength, no Fed hikes &

structural reforms

VALUATION Reasonable valuations, attractive relative

to developed markets



RECORD CYCLE CALLS FOR DISCIPLINED INVESTMENT

APPROACH

/ 19




U.S. LARGE CAPS

SELECTIVE EM EQUITIES

GLOBAL FINANCIALS

U.S. SHORT DURATION &

CORPORATE BONDS

ASIAN CORPORATE

BONDS

U.S. REAL ESTATE

SLOWDOWN YES –

RECESSION NO

AGING CYCLE

CENTRAL BANKS

REMAIN SUPPORTIVE

STRENGTHEN

STABILITY

ECONOMIC

OUTLOOK

SEIZE

OPPORTUNITIES



APPENDIX: PERFORMANCE OVER THE PAST 5 YEARS

(12-MONTH PERIODS)


Past performance is not a reliable indicator of future returns. This information is intended for informational purposes only and does not constitute investment advice, a recommendation, an offer or solicitation.


/ 20

04/14 - 04/15 04/15 - 04/16 04/16 - 04/17 04/17 - 04/18 04/18 - 04/19

S&P 500 10.7% -1.0% 15.4% 11.1% 11.2%

MSCI World Index 5.4% -6.1% 12.4% 11.1% 4.4%

US IG Corp 4.9% 2.8% 2.7% 0.6% 6.4%

US HY 2.6% -1.1% 13.3% 3.3% 6.7%

Nasdaq 20.1% -3.4% 26.6% 16.8% 14.6%

DAX 19.3% -12.4% 23.9% 1.4% -2.1%

UST 10yr 7.2% 4.0% -1.3% -2.7% 6.6%

GER 10yr 9.7% 2.7% 0.8% -1.0% 5.3%

MSCI EM 5.3% -19.8% 16.4% 19.1% -7.3%

Asia Credit 5-7y 7.4% 4.8% 5.3% 0.1% 8.1%

Euro Credit 5-7y 6.5% 1.8% 3.1% 1.6% 3.8%

US Credit 5-7y 5.0% 3.5% 3.3% -0.1% 7.5%

US Credit Index 5.0% 2.9% 3.0% 0.8% 6.4%

US High Yield Index 2.6% -1.4% 13.6% 3.2% 6.7%

MSCI China Index 43.5% -32.2% 20.6% 33.8% -6.0%

MSCI India Index 18.3% -4.0% 14.9% 15.2% 5.9%

MSCI Brazil Index -22.5% -19.2% 25.6% 18.0% -4.4%

MSCI Thailand Index 6.0% -9.6% 12.7% 19.5% -6.0%

MSCI Turkey Index 11.4% 3.2% 10.0% 5.4% -8.3%

MSCI Taiwan Index 15.2% -15.3% 20.1% 7.3% 3.5%

MSCI South Africa Index 21.4% -5.9% 0.9% 6.9% 0.3%

MSCI Korea Index 2.0% -7.9% 20.6% 18.0% -12.6%

MSCI Indonesia Index 4.9% -3.8% 16.5% 1.9% 8.6%

MSCI Russia Index -10.5% -10.5% 13.6% 6.7% 8.6%



IMPORTANT INFORMATION

/ 21

The brand DWS represents DWS Group GmbH & Co. KGaA and any of its subsidiaries, such as DWS Distributors, Inc., which offers investment products, or DWS Investment Management Americas, Inc. and RREEF America

L.L.C., which offer advisory services.

This document has been prepared without consideration of the investment needs, objectives or financial circumstances of any investor. Before making an investment decision, investors need to consider, with or without the

assistance of an investment adviser, whether the investments and strategies described or provided by DWS, are appropriate, in light of their particular investment needs, objectives and financial circumstances. Furthermore, this

document is for information/discussion purposes only and does not and is not intended to constitute an offer, recommendation or solicitation to conclude a transaction or the basis for any contract to purchase or sell any security,

or other instrument, or for DWS to enter into or arrange any type of transaction as a consequence of any information contained herein and should not be treated as giving investment advice. DWS does not give tax or legal

advice. Investors should seek advice from their own tax experts and lawyers, in considering investments and strategies suggested by DWS. Investments with DWS are not guaranteed, unless specified. Although information in

this document has been obtained from sources believed to be reliable, we do not guarantee its accuracy, completeness or fairness, and it should not be relied upon as such. All opinions and estimates herein, including forecast

returns, reflect our judgment on the date of this report, are subject to change without notice and involve a number of assumptions which may not prove valid.

Investments are subject to various risks, including market fluctuations, regulatory change, counterparty risk, possible delays in repayment and loss of income and principal invested. The value of investments can fall as well as

rise and you may not recover the amount originally invested at any point in time. Furthermore, substantial fluctuations of the value of the investment are possible even over short periods of time. Further, investment in

international markets can be affected by a host of factors, including political or social conditions, diplomatic relations, limitations or removal of funds or assets or imposition of (or change in) exchange control or tax regulations in

such markets. Additionally, investments denominated in an alternative currency will be subject to currency risk, changes in exchange rates which may have an adverse effect on the value, price or income of the investment. This

document does not identify all the risks (direct and indirect) or other considerations which might be material to you when entering into a transaction. The terms of an investment may be exclusively subject to the detailed

provisions, including risk considerations, contained in the Offering Documents. When making an investment decision, you should rely on the final documentation relating to the investment and not the summary contained in this

document.

This publication contains forward looking statements. Forward looking statements include, but are not limited to assumptions, estimates, projections, opinions, models and hypothetical performance analysis. The forward looking

statements expressed constitute the author’s judgment as of the date of this material. Forward looking statements involve significant elements of subjective judgments and analyses and changes thereto and/or consideration of

different or additional factors could have a material impact on the results indicated. Therefore, actual results may vary, perhaps materially, from the results contained herein. No representation or warranty is made by DWS as to

the reasonableness or completeness of such forward looking statements or to any other financial information contained herein. We assume no responsibility to advise the recipients of this document with regard to changes in our

views.

No assurance can be given that any investment described herein would yield favorable investment results or that the investment objectives will be achieved. Any securities or financial instruments presented herein are not

insured by the Federal Deposit Insurance Corporation („FDIC“) unless specifically noted, and are not guaranteed by or obligations of Deutsche Bank AG or its affiliates. We or our affiliates or persons associated with us may act

upon or use material in this report prior to publication. DB may engage in transactions in a manner inconsistent with the views discussed herein. Opinions expressed herein may differ from the opinions expressed by departments

or other divisions or affiliates of Deutsche Bank. This document may not be reproduced or circulated without our written authority. The manner of circulation and distribution of this document may be restricted by law or regulation

in certain countries. This document is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, including the United

States, where such distribution, publication, availability or use would be contrary to law or regulation or which would subject Deutsche Bank to any registration or licensing requirement within such jurisdiction not currently met

within such jurisdiction. Persons into whose possession this document may come are required to inform themselves of, and to observe, such restrictions.

Past performance is no guarantee of future results; nothing contained herein shall constitute any representation or warranty as to future performance. Further information is available upon investor’s request. All third party data

(such as MSCI, S&P & Bloomberg) are copyrighted by and proprietary to the provider.

Deutsche Bank AG is authorized under German Banking Law (competent authority: European Central Bank and the BaFin, Germany’s Federal Financial Supervisory Authority) and by the Prudential Regulation Authority and

subject to limited regulation by the Financial Conduct Authority and Prudential Regulation Authority. Details about the extent of our authorization and regulation by the Prudential Regulation Authority, and regulation by the

Financial Conduct Authority are available from us on request.

© May 2019 DWS Investment GmbH

I-067776-1 (5/19)
