Standing guard over your portfolio ℠

Management You Can Rely On Other advisors provide you with little more than a financial road map. The Minuteman Asset Management program stands guard, watching your portfolio. Every minute of the trading day your portfolio is monitored for asset class expansion and contractions. If an asset class grows or shrink beyond acceptable tolerances, the Minuteman rebalances your portfolio. This ensures that the risk of your portfolio remains at a level you are comfortable with.

Rebalancing: Why? Growth of a $1 Million Portfolio Peak Subsequent Low Ending Value Portfolio A $2.81 Mil$1.97 Mil $2.50 Mil Portfolio B $2.67 Mil$2.09 Mil $2.61 Mil Stocks are represented by the S&P 500, bonds by the Lehman Aggregate Bond Index. Source: Compustat, Lehman Bros., and Bernstein. Online Report URLOnline Report URL Rebalancing—bringing a portfolio’s allocations back into their intended proportions—ensures that you maintain your risk/reward profile. Rebalancing simply means taking money from an asset class that has performed well and reinvesting it into one that has lagged, a practice which follows the sage financial advice to “Buy low, sell high.”

Rebalancing: How End of the day: Rebalancing is usually executed through buying and selling shares of mutual funds, once daily. Immediate: The Minuteman Asset Management program advocates the use of Exchange Traded Funds (ETF) so that when the Minuteman sees a rebalancing need, it can be executed immediately. Good Better

Rebalancing: When? Is it better to rebalance your portfolio Monthly? Quarterly? Semi-Annually? Annually? One thing for certain is that all the rebalancing options above ignore what is happening to your portfolio in-between the rebalancing intervals. Is this acceptable? No!

The optimal method of rebalancing is based on asset class variance. Study conducted by a group at MIT (Massachusetts Institute of Technology) This variance-based rebalancing can reduce risk and increase returns. Study conducted by the Bernstein Institute Rebalancing: When? MIT Working Paper Bernstein Institute Paper

A Hidden Mutual Fund Risk Manager Performance Selecting an actively-managed mutual fund based on its historical performance ignores that the mutual fund manager may underperform in the future. If the portfolio manager did underperform, would you look to exit the mutual fund? If your answer is yes, then you might fall into a bad cycle of buying high and selling low!

Past Success = Future Trouble? Some financial advisors recommend portfolios that include mutual funds which have the highest historical performance, but is that the best way to choose? Mutual funds go through cycles. What confidence do you have that the fund manager will have enough superior investment ideas to meet the needs of the new money? Manager has good performance People see the good performance People move investments to the Manager Manager gets flooded with new money Manager searches for new investments

Index Invest with Confidence “…approximately 80% of mutual funds underperform the stock market's returns in a typical year.” - Bill Barker, Senior Producer of Investing, The Motley Fool “…approximately 80% of mutual funds underperform the stock market's returns in a typical year.” - Bill Barker, Senior Producer of Investing, The Motley Fool “Since 1984…the S&P 500 Index…provided a 16.3% return. The average equity mutual fund turned in a return of 13.1% — 3.2 percentage points less…” - Remarks by John C. Bogle, November 15, 2001 Founder and Former Chairman, The Vanguard Group (Return data are through 10/1/2001) “Since 1984…the S&P 500 Index…provided a 16.3% return. The average equity mutual fund turned in a return of 13.1% — 3.2 percentage points less…” - Remarks by John C. Bogle, November 15, 2001 Founder and Former Chairman, The Vanguard Group (Return data are through 10/1/2001)

The Minuteman at Work for You Throughout the day, we monitor your portfolio for any asset class deviation; eliminating excessive risk. If your portfolio become skewed (beyond acceptable tolerances) as markets ebb and flow, it is immediately rebalanced.

About Exchange Traded Funds Exchange Traded Funds (ETFs) provide real time access to indexed investments. Exchange Traded Funds are less expensive than their Mutual Fund counterparts.

Minuteman Has It All Variance Based Active Rebalancing Exchange Traded Funds Index Funds Consult your investment professional today to learn how to get Minuteman Asset Management standing guard for you.