Time Targeted Portfolios Market Segments Time Targeted Portfolios

What Is “The Market”? Source: Dimensional Fund Advisors, Global Market Breakdown, December 2014 The Russell 3000 Index is used as the proxy for the US market. The proxies for the non-US developed and emerging markets are the respective developed country and emerging country portions from the MSCI All Country World IMI ex USA Index

S&P 500 Missing Approximately 60% of the Global Market Source: Dimensional Fund Advisors, Global Market Breakdown, December 2014 The S&P 500 accounts for roughly 80 of the US market capitalization. S&P Dow Jones S&P 500® fact sheet January 30, 2015

Value Growth vs.

↓ Price to Book Ratio = 𝐏𝐫𝐢𝐜𝐞 𝐩𝐞𝐫 𝐒𝐡𝐚𝐫𝐞 𝐁𝐨𝐨𝐤 𝐕𝐚𝐥𝐮𝐞 𝐩𝐞𝐫 𝐒𝐡𝐚𝐫𝐞 Value Stocks A stock that tends to trade at a lower price relative to it's fundamentals (i.e. dividends, earnings, sales, etc.) and thus considered undervalued by a value investor. Common characteristics of such stocks include a high dividend yield, low price-to-book ratio and/or low price-to-earnings ratio. Investopedia ↓ Price to Book Ratio = 𝐏𝐫𝐢𝐜𝐞 𝐩𝐞𝐫 𝐒𝐡𝐚𝐫𝐞 𝐁𝐨𝐨𝐤 𝐕𝐚𝐥𝐮𝐞 𝐩𝐞𝐫 𝐒𝐡𝐚𝐫𝐞 ↑ Dividend Yield = Dividend per Share Price per Share ↓ Price Earnings Ratio = Price per Share Earnings per Share

Value Stocks vs. Growth Stocks Annual Return Comparison Since 1927 21st Century Data Source: Fama French Dataset 1926-2015. Value stocks are defined as lowest 3 deciles ranked on BE/ME. Growth stocks are defined as the highest 3 deciles ranked on BE/ME. BE/ME is book equity at the last fiscal year end of the prior calendar year divided by ME at the end of December of the prior year. See Appendix and Data Disclosures

Value versus Growth Data Source: Fama French Dataset 1926-2014. Value stocks are defined as lowest 3 deciles ranked on BE/ME. Growth stocks are defined as the highest 3 deciles ranked on BE/ME. BE/ME is book equity at the last fiscal year end of the prior calendar year divided by ME at the end of December of the prior year. See Appendix and Data Disclosures

Large Company Stocks Versus Small

US Small Cap Stocks vs. US Large Cap Stocks Annual Return Comparison Since 1927 21st Century Data Source: Fama French Dataset 1926-2013. Small Cap stocks are defined as deciles 6 through 8 ranked on market capitalization. Large Cap stocks are defined as the highest 2 deciles ranked on market capitalization. The portfolios are constructed at the end of each June using the June market equity and NYSE breakpoints. See Appendix and Data Disclosures

Small Cap versus Large Cap Data Source: Fama French Dataset 1926-2013. Small Cap stocks are defined as deciles 6 through 8 ranked on market capitalization. Large Cap stocks are defined as the highest 2 deciles ranked on market capitalization. The portfolios are constructed at the end of each June using the June market equity and NYSE breakpoints. % Small Cap Wins show how often Small Cap outperformed Large Cap. See Appendix and Data Disclosures

Emerging Markets

Emerging Markets vs. US Large Cap Annual Return Comparison Since 1970 21st Century Data Source: US Large Cap = S&P 500 TR Index - S&P Dow Jones all rights reserved; Emerging Markets = MSCI Emerging Markets Index - MSCI all rights reserved 1998 to 2015. Emerging Markets prior to 1998 = Global Financial Data. Data Set 1970-2015 See Appendix and Data Disclosures

Emerging Markets vs. US Large Cap 1 Year to 20 Year Periods Data Source: US Large Cap = S&P 500 TR Index - S&P Dow Jones all rights reserved; Emerging Markets = MSCI Emerging Markets Index - MSCI all rights reserved. Data Set 1970-2014 See Appendix and Data Disclosures

Stock Market Risk Factors Value vs. Growth / US Small Cap vs Stock Market Risk Factors Value vs. Growth / US Small Cap vs. US Large Cap / Emerging Markets vs. US Large Cap A portfolio that deviates from the global stock market weightings is said to “tilt” to risk factors like small cap stocks, value stocks, or emerging markets stocks. As seen in the previous slide, these risk factors tend to outperform their counterparts, but not every time. The table below shows how often these risk factors have outperformed their counterparts since 1970. 2015 happened to be one of the years where none of the factors emerged on top. This has only occurred about 9 percent of the time since 1970. Over this time span, two or more factors have outperformed about 63 percent of the time. See subsequent pages and Data Disclosures for data sources and details. Past results to not guarantee future results.

Appendix RISK DISCLOSURES ANALYSIS METHODOLOGY INDEX DEFINITION The performance exhibits are generic and educational in nature, and do not pertain to your actual portfolio. The exhibits were designed to illustrate the relationship between risk and return, and the uncertainty of stocks relative to bonds. Market risk is the risk that the value of an investment will decrease due to moves in market factors. Securities of small companies are often less liquid than those of large companies. As a result, small company stocks may fluctuate relatively more in price. Foreign securities prices may decline or fluctuate because of: (a) economic or political actions of foreign governments, and/or (b) less regulated or liquid securities markets. Investors holding these securities are also exposed to foreign currency risk (the possibility that foreign currency will fluctuate in value against the U.S. dollar). ANALYSIS METHODOLOGY Back-tested performance is provided for informational purposes only and does not represent actual performance. It is strictly hypothetical. Actual performance may have been materially lower and future performance may be materially lower. Results also do not reflect actual trading and market factors that could have impacted a client’s or Asset Dedication’s decision-making process. No matter how positive historical audits have been over any time period, the potential for loss is always present due to factors which may not be accounted for in the historical audit. The nature of a back-tested audit creates the potential for a financial professional to select superior performance results in order to get the desired audit results. INDEX DEFINITION An index is list of stocks provided by an index provider that tracks a given segment of the investment universe s and serves as a benchmark against which performance and characteristics are measured. Indices are not available for direct investment; its performance does not reflect the expenses associated with the management of an actual portfolio. The S&P data are provided by Standard & Poor's Index Services Group. The S& P 500 is an index consisting of 500 stocks, which are weighted by market value. Its performance is thought to be representative of the stock market as a whole and provides a broad snapshot of the overall U.S. equity market.  

Disclosures Asset Dedication, LLC is a registered investment adviser located in San Francisco, California. Asset Dedication may only transact business in those states in which it is registered, or qualifies for an exemption or exclusion from registration requirements. Asset Dedication’s written disclosure statement discussing Asset Dedication’s business operations, services, and fees is available from Asset Dedication upon written request. Asset Dedication does not make any representations as to the accuracy or completeness of any information prepared by any unaffiliated third-party. Past performance is not a guarantee of future investment results. Investing in securities involves the risk of loss, and there is no assurance that any investment will be profitable. Historical performance results for investment indices and categories generally do not reflect the deduction of transaction and custodial charges, nor the impact of taxes; the incurrence of which would have the effect of decreasing performance results. Asset Dedication and Dimensional Fund Advisors are not affiliated with each other. Dimensional Fund Advisors is an investment advisor registered with the Securities and Exchange Commission. Consider the investment objectives, risks, and charges and expenses of the Dimensional funds carefully before investing. For more complete information about the Dimensional funds, please read the prospectus carefully before investing by calling Dimensional Fund Advisors collect at (310) 395‐8005 or at www.dimensional.com. Dimensional funds are distributed by DFA Securities LLC, an affiliate of Dimensional Fund Advisors, 6300 Bee Cave Road, Building One, Austin, TX 78746.