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Principia® Presentations & Education The 2008 Principia® Presentations & Education library encompasses a collection of communication resources developed to assist advisors during client interactions. Specialized Microsoft® PowerPoint® presentations, formerly known as Ibbotson’s Asset Allocation Library, introduce time-tested investment principles. Investor brochures, available as PDF files, address common retirement risks, while Web-based professional training explores the practical application of asset allocation methodologies. Advisors can also search and download white papers on a broad range of research relevant to the creation of the presentations and brochures. Key Features

Presentation length ranges from nine to 20 slides each (totaling more than 250 slides), ready for personalization with the speaker’s name or a company logo Pre-written speakers’ notes save time and help clarify complex topics during presentations Brochures range from two to nine pages each and address a variety of retirement risks for investors Brochures are available as PDF files so that they can be printed and distributed or sent in electronic format All presentations and brochures are reviewed by FINRA for use with the public The Advanced Asset Allocation—Short Course prepares advisors to explain the value of asset allocation to investors Advisors can complete the course at their own pace in about four hours and demonstrate their comprehension through the final exam Look for the symbol throughout this document to designate what content is new for 2008

Professional Presentations Pg# Client Handouts Pg# Education Pg# Downturns and Recoveries 2 Longevity Risk 45 Advanced Asset Allocation- Web Training 46 Exchange-Traded Funds 3 Solvency Risk 45 White Papers from Morningstar and Ibbotson 46 Global Investing 5 Savings Risk 45 Methodology Papers 46 Growth and Value Investing 8 Inflation Risk 45 Investing for Retirement 10 Market Volatility Risk 45 Investing in Commodities 12 Retiree Spending Risk 45 Investing in Emerging Markets 15 Withdrawal Risk 45 Long-Term Investment Performance 18 Income Risk and the Use of Immediate Annuities 45 Mutual Fund Investing 20 Living Benefits 45 Portfolio Diversification 22 Risks in Retirement 45 Portfolio Performance 24 Principles of Investing 26 Real Estate Investing (updated July 2008) 28 Retirement Income 30 Risk and Volatility 33 Role of Immediate Annuities in Retirement 35 Sector Investing 37 Stocks and Bonds 39 Taxes and Investment Performance 41 Understanding Deferred Annuities 43

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Downturns and Recoveries Evaluate the characteristics of different asset classes during economic and market downturns and recoveries.

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Exchange-Traded Funds Examine the recent growth and performance of Exchange-Traded Funds.

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Exchange-Traded Funds (cont’d)

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Global Investing Communicate the benefits and risks of investing globally.

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Global Investing (cont’d)

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Global Investing (cont’d)

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Growth and Value Investing Convey the importance of investing in both growth and value stocks by evaluating performance patterns among small-, mid-, and large-cap categories.

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Growth and Value Investing (cont’d)

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Investing for Retirement Explain the benefits of tax-deferred retirement investments and the advantages of beginning early.

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Investing for Retirement (cont’d)

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Investing in Commodities (new for 2008) Explore the benefits of investing in commodities and how such investments can be used to diversify portfolios and manage economic risks.

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Investing in Commodities (cont’d)

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Investing in Commodities (cont’d)

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Investing in Emerging Markets (new for 2008) Convey the attributes of emerging markets and the various benefits that these markets offer in comparison to developed markets.

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Investing in Emerging Markets (cont’d)

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Investing in Emerging Markets (cont’d)

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Long-Term Investment Performance Convey the value of staying in the market for the long term.

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Long-Term Investment Performance (cont’d)

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Mutual Fund Investing Illustrate the growth and performance of mutual funds while explaining differences in risk, share class, and style.

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Mutual Fund Investing (cont’d)

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Portfolio Diversification Explain why asset allocation is important and how diversification helps manage volatility.

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Portfolio Diversification (cont’d)

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Portfolio Performance Explore the performance of various portfolio allocations over time.

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Portfolio Performance (cont’d)

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Principles of Investing Graphically illustrate the basic concepts behind successful investing, such as compounding, reinvestment, rebalancing, and dangers of market timing.

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Principles of Investing (cont’d)

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Real Estate Investing Explore the benefits of investing in commercial property by comparing US REITs, direct investment in domestic property and foreign real estate securities.

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Real Estate Investing (cont’d)

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Retirement Income (Winner of the InvestmentNews award for Retirement Income Retail Communications) Examine the challenges of investment planning in retirement, including longevity risk, savings risk, market risk, and withdrawal risk, using a combination of simple illustrations and Monte-Carlo simulations.

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Retirement Income (cont’d)

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Retirement Income (cont’d)

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Risk and Volatility Convey the risk and volatility characteristics of different asset classes.

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Risk and Volatility (cont’d)

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Role of Immediate Annuities in Retirement Convey how fixed and variable immediate payout annuities can provide an income floor in retirement using a combination of simple illustrations and Monte-Carlo simulations.

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Role of Immediate Annuities in Retirement (cont’d)

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Sector Investing A detailed look into the historical performance characteristics of sectors and their impact on asset allocation.

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Sector Investing (cont’d)

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Stocks and Bonds Examine the risks and rewards of including stocks and bonds in a portfolio.

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Stocks and Bonds (cont’d)

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Taxes and Investment Performance Show the effects of taxes on investment performance and the benefit of tax deferred investments.

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Taxes and Investment Performance (cont’d)

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Understanding Deferred Annuities Compare the characteristics of fixed and variable deferred payout annuities, including illustrations on the basic mechanics behind popular living benefit options.

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Understanding Deferred Annuities (cont’d)

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Client Handouts These PDF Brochures range from three to six pages each and address a variety of retirement risks for investors. All handouts can be printed and distributed to clients, or sent in electronic format. Longevity Risk

(2 pages) When planning for retirement, perhaps the first and most important decision you should make is how many years you are going to spend in retirement. This investor brochure discusses the risk of living longer than your portfolio.

Market Volatility Risk (3 pages) Managing downside risk can be as important as achieving growth potential. This investor brochure contrasts the volatility of stocks and bonds, and shows why a diversified portfolio can help weather down markets.

Solvency Risk (4 pages) Many investors nearing retirement plan for Social Security, Medicare, and defined-benefit pension plans to meet the majority of their retirement needs. This brochure shows investors why they need to rely more on their own savings to meet retirement needs.

Retiree Spending Risk (4 pages) This brochure highlights how significant income needs can be in retirement due to income replacement, medical expenses, and long-term care needs.

Savings Risk (3 pages) Most Americans are not saving enough for their retirement. This investor brochure describes the saving situation in the U.S. and illustrates the importance of saving early.

Withdrawal Risk (4 pages) Many investors are concerned about the risk of drawing down assets too aggressively to meet their spending needs. This brochure shows what withdrawal rates have been sustainable in the past, and discusses the impact of taking withdrawals in different market conditions.

Inflation Risk (2 pages) This brochure shows investors how rising prices erode purchasing power over time, and further discusses which asset classes can outpace inflation.

Income Risk and the Use of Immediate Annuities (6 pages) Many people are appropriately concerned about outliving their assets. This brochure shows investors how they can use asset allocation and guaranteed income products to manage income risk.

Living Benefits (5 pages) Many variable annuity contracts1now offer a number of optional features you can select for an additional annual fee.

Risks In Retirement (9 pages) How well your portfolio provides for your retirement not only depends on how well you save before retirement, but how you manage funds during retirement.

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Education Morningstar’s robust set of educational resources include asset allocation training and reference materials.

1. Advanced Asset Allocation-Short Course, Web Training This self-paced online training course developed by Ibbotson Associates equips financial professionals who understand asset allocation methodology with knowledge they can use to build optimized portfolios. Note: this course is conceptual in nature and does not receive annual updates.

2. A full complement of relevant white papers and methodology documents are included from the research staff at Ibbotson and

Morningstar.

Screen shots from Advanced Asset Allocation-Short Course