MBA SIM Fund

Board PresentationApril 30, 2010

22

2009-2010 Student Managers

Spencer Rands

W.P. Carey MBA

Finance & Real Estate

Class of 2010

Eric Dalbom

W.P. Carey MBA

Finance & Real Estate

Class of 2010

Himanshu Gupta

W.P. Carey MBA

Supply Chain Finance

Class of 2010

Andrew Harbut

W.P. Carey MBA

Finance

Class of 2010

Matt Pendleton

W.P. Carey MBA

Finance

Class of 2010

Perrin Gayle

W.P. Carey MBA

Finance

Class of 2010

3

Agenda

Overview Portfolio Performance Economic Climate & Outlook Portfolio Highlights Attribution Analysis Takeaways

4

Overview

5

Fund Guidelines

Long-term investment strategy Minimum 75% equities Maximum 20% fixed income Maximum 10% cash $500MM minimum market cap No short selling Limits on derivatives

6

Style Selection

Style: Midcap Growth Market Cap: $2b - $10b

Benchmark Russell Midcap Growth Index (RDG)

Asset Allocation Equities: 92% Fixed Income: 5% Cash: 3%

7

Portfolio Analysis

8

Fund Characteristics

  SIM Fund

Russell Midcap Growth

Market Cap ($B) 6,465.35 7,262.96Dividend Yield 0.90 0.98Trailing P/E 17.52 31.38Forward P/E 15.17 21.39ROA 12.33 7.84ROE 25.93 16.68

9

19-Nov-09 19-Dec-09 19-Jan-10 19-Feb-10 19-Mar-10-5%

0%

5%

10%

15%

20%

Russell Midcap Growth SIM Fund

Fund PerformanceSpring Results: 11/20/09 – 4/16/10

11/19 Portfolio Value

$316,902

4/16 Portfolio Value

$372,408 (17.52%)

4/16 RDG Value$370,322 (16.86%)

10

4-Oct-09 4-Nov-09 4-Dec-09 4-Jan-10 4-Feb-10 4-Mar-10 4-Apr-10-10%

-5%

0%

5%

10%

15%

20%

25%

30%

Russell Midcap Growth SIM FUND

Fund PerformanceCumulative Return: 10/5/09 – 4/16/10

10/4 Portfolio Value

$322,608

4/16 Portfolio Value

$372,408 (15.44%)

11/19 Portfolio Value$316,902 (-1.77%)

4/16 RDG Value$395,691 (22.65%)

11

Fund PerformanceHolding Period Returns by

Security

-30.0%

-20.0%

-10.0%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%ARO

AHGP

CHSIDPSALTRKMX

DLTRDRQ RAH YUMCEPHRDG FLR

CEPHADSFSLRAPOL

HCCCSC WDC CSJ

SOHU

FRX

TSRA

11/20/09 – 4/16/10

12

Economic Climate & Outlook

13

Economic Outlook

In December, we thought… There would be a continuing recovery Unemployment would remain high Consumer confidence would increase Housing prices would stabilize

…and we were correct.

14

Economic Climate

13,800

14,000

14,200

14,400

14,600

Q2 2009 Q3 2009 Q4 2009

GDP (billions of $)

290

295

300

305

Dec Jan Feb March

Retail Sales (billions of $)

4.24.44.64.8

55.2

December January February March April

Continued Claims (millions)

160

165

170

175

180

185

Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009

US Median Home Prices (thousands of $)

15

Equity Sector AllocationConsumer

Discretionary25%

Consumer Staples

9%

Energy 13%

Financial Services6%

Health Care 14%

Industrials 11%

Information Technology

21%

16

Looking Forward 6 Months

Uncertainty around US$ Continued domestic real GDP growth

Exports PCE

Economic risk in China Domestic Sectors

Overweight: Healthcare, Consumer Discretionary Underweight: Financials, Utilities

17

Decision Process

18

Decision Process

Fresh perspective from a different analyst

Is the industry still poised to outperform the market?

Is this firm the best in its industry? Are the fundamentals still strong? Qualitative factors

Stock Reevaluations

19

Decision ProcessExample: Aeropostale (ARO)

Down 25% last time we met Industry questionable, but… Price-point fits economic

conditions Excellent inventory management Avoidance of deep discounts Poised to gain market share from

competitors Recommendation: HOLD

20

Nov. 20 ($21.24)

Aeropostale (ARO)

Source: Google Finance

21

Decision ProcessExample: Apollo Group (APOL)

Industry still strong Strong revenue growth (domestic

& int’l) Underpriced (P/E) But…

concerns about patterns of ethical issues and regulatory pressure keep the stock price low

Recommendation: SELL

22

Sold Feb. 5 @ $60.10

Apollo Group (APOL)

Source: Google Finance

23

Decision Process

Missed Q4 earnings Litigation Risk Volatility Concerns Recommendation: SELL

Example: Tessera (TSRA)

Sold Jan 21 @ $18.44

Source: Google Finance

24

Decision ProcessExample: Forest Laboratories

(FRX)& Cephalon (CEPH) Attractive industry

Healthcare Bill Cephalon nearing price target Forest Labs undervalued Reduced holding in CEPH, bought

FRX

25

Forest Labs (FRX) & Cephalon (CEPH)

4/7: FDA panel votes against Forest Lab’s Daxas drug

Source: Google Finance

26

Performance Attribution

27

Equity return: 18.2% Benchmark return: 17.1% Alpha: 1.1%What contributed to the positive

alpha?

Performance Attribution

28

-1.50%

-1.00%

-0.50%

0.00%

0.50%

1.00%

1.50%

2.00%

Allocation Effect Selection Effect Interaction Effect

Performance Attribution

1.1%

Data Source: Fifth Third Asset Management

29

Allocation Effect

Data Source: Fifth Third Asset Management

-0.30%

-0.20%

-0.10%

0.00%

0.10%

0.20%

0.30%

0.40%

Utilities*

Consumer DiscretionaryMaterials*

IT Financials Telecom. Services*

Health Care

Industrials

Consumer Staples

Energy

* Fund was not invested in sector

30

Selection Effect

-3.50%

-2.50%

-1.50%

-0.50%

0.50%

1.50%Consumer Staples

Consumer DiscretionaryEnergy

Health Care

Industrials Financials

Information Technology

Data Source: Fifth Third Asset Management

31

19-Nov-09 19-Dec-09 19-Jan-10 19-Feb-10 19-Mar-10-5%

0%

5%

10%

15%

20%Russell Midcap Growth SIM Fund

Risk-adjusted PerformanceHow did the Fund perform on a risk-adjusted

basis?

Higher return+

Lower volatility=

Higher risk-adjusted performance

 SIM Fund

Russell Midcap Growth S&P 500

Annualized return 41.96% 40.51% 21.57%Standard deviation 12.96% 14.52% 13.23%Sharpe Ratio 3.21 2.76 1.60

32

Takeaways

33

Learning Points

Start with an economic outlook Importance of style selection &

allocation Value of strong fundamentals Look beyond the numbers Long-term perspective ADR reporting issues

34

Thank You

Thank you to: Board of Directors Keith Wirtz, Justin Dammel, and Fifth

Third Jeanne Elliott Herb Kaufman

352

2010-2011 Student Managers

Amol Agarwal

W.P. Carey MBA

Finance

Class of 2011

Joe Downs

W.P. Carey MBA

Finance

Class of 2011

Jonathan Kielmeyer

W.P. Carey MBA

Finance & Marketing

Class of 2011

Andrew Harper

W.P. Carey MBA

Finance

Class of 2011

Benjamin Hawthorne

W.P. Carey MBA

Finance

Class of 2011

Jameson Bennett

W.P. Carey MBA

Finance & Real Estate

Class of 2011

Praveen Gujar

W.P. Carey MBA

Finance

Class of 2011

Andre Shearer

W.P. Carey MBA/MSIM

Finance

Class of 2011