1 Undergraduate Student Managed Fund Spring 2014 Presentation March 6, 2014

2 Student Managed Fund Fund Managers Spring 2014 Presentation Fund Managers Officers: Lead Manager: Robert Bailey Portfolio Manager: Duston Hodgkins Secretary: Tom Blankemeier Managers: Alexander Anisimov David Boudreau Eric Bourassa Michael Cox Joseph Grieco Matthew Mastrogiorgio Lina Posada

3 Agenda 1)Investment Objective and Philosophy 2)Investment Process 3)Economic Outlook 4)Portfolio Overview 1)Interesting Holdings 2)Performance 3)Attribution Analysis 5)Lessons Learned Student Managed Fund Agenda Spring 2014 Presentation

4 Student Managed Fund Investment Objective & Philosophy Spring 2014 Presentation Investment Objective & Philosophy Objective Outperform the S&P 500 Learn to analyze as value investors Philosophy Search for undervalued securities based on estimation of intrinsic value compared to current market price Style Bottom-up approach

5 Student Managed Fund Industry Managers Spring 2014 Presentation Industry Managers Basic Materials: Matthew Mastrogiorgio Consumer Discretionary: Robert Bailey, David Boudreau Consumer Staples: Thomas Blankemeier, Duston Hodgkins Energy: Alexander Anisimov, Michael Cox, Lina Posada Financials: Thomas Blankemeier, David Boudreau, Joseph Grieco Healthcare: Eric Bourassa, Robert Bailey, Alexander Anisimov Industrials: Matthew Mastrogiorgio, Lina Posada Real Estate: Eric Bourassa, Michael Cox Transportation: Michael Cox Technology: Joseph Grieco, Duston Hodgkins

6 Student Managed Fund Investment Strategy Spring 2014 Presentation Investment Strategy High ROE & ROIC i.e. ORCL Sustainable Barriers to Competition i.e. ACN Consistent Return to Shareholders i.e. SLB Strong Business Models i.e. DTV

7 Student Managed Fund Investment Tools Spring 2014 Presentation Investment Tools

8 Student Managed Fund Investment Process Spring 2014 Presentation Investment Process Step 1 Manager Researches Chosen Company Step 2 Presents Research to Other Managers Step 3 Thorough Discussion on Company Research Step 4 Majority of Managers Vote for Approval Step 5 If Yes  Vote on Allocation of Capital If No  Conduct Further Research

9 Student Managed Fund Portfolio Approach Spring 2014 Presentation Portfolio Approach Seek to take positions at various percentage increments depending on a variety of factors 6% or under position Strong fundamentals Fairly valued Carry more risk 6% or larger position Safe/predictable Strong upside potential Strong downside protection Undervalued

10 Student Managed Fund Economic Outlook Spring 2014 Presentation Quantitative Easing and recent tapering Unemployment in the US Eurozone Recovery and Deflation Economic Outlook

11 Student Managed Fund Economic Outlook Spring 2014 Presentation Quantitative Easing The growth of the Fed’s Balance Sheet and Interest Rates Source: Bloomberg LP Interest rates appear to be on the rebound with the recent tapering of mortgage- backed securities and 30-year Treasury purchases

12 Student Managed Fund Economic Outlook Spring 2014 Presentation QE’s Affect on the US Equity Market Correlation of Balance Sheet and Equity Performance Source: Bloomberg LP With QE looking to halt by year end, will the equity market be able to maintain this positive trend without being artificially stimulated?

13 Student Managed Fund Economic Outlook Spring 2014 Presentation Strength of the US Economy The Unemployment rate 2007 – Present Source: Bloomberg LP

14 Student Managed Fund Economic Outlook Spring 2014 Presentation Slow Recovery Deflation European Central Bank and Outright Monetary Transaction (OMT) program Conditions in the Eurozone

15 Portfolio Breakdown Student Managed Fund Portfolio Breakdown Spring 2014 Presentation Average weight per company: 5.88%

16 Student Managed Fund Sector Allocation Spring 2014 Presentation Sector Allocation

17 Portfolio Performance Student Managed Fund Portfolio Performance Spring 2014 Presentation

18 Portfolio Performance Student Managed Fund Portfolio Performance Spring 2014 Presentation Undergraduate SMF PortfolioS&P 500 Beginning Value (9/13/2013)$1,567, Beginning Value1, Current Value (2/28/2014)$1,731, Current Value1, Overall Profit/(Loss)$164, Overall Profit/Loss Return10.51%Return11.18% Undergraduate SMF portfolio has underperformed the S&P 500 by 0.67% (67 BPS) Beta = 0.97, Sharpe Ratio = 2.48, Treynor Ratio = 0.29

19 Individual Stock Performance Student Managed Fund Portfolio Performance Spring 2014 Presentation

20 Best Performing Stock - NVR Real Estate: Homebuilder Unrealized gain of 26.12% Strong Q4 earnings EPS $21.15 vs. estimates of $16.08 On December 18 th management authorized an additional $300 million buyback program Student Managed Fund Portfolio Performance Spring 2014 Presentation

21 Worst Performing Stock – Bed Bath and Beyond Reason Q4 guidance lowered Worried about holiday season Reinvestment Growth opportunities Free cash flow stability Lower cost basis Student Managed Fund Portfolio Performance Spring 2014 Presentation

22 Attribution Analysis Student Managed Fund Attribution Analysis Spring 2014 Presentation

23 Student Managed Fund Attribution Analysis Spring 2014 Presentation Attribution Analysis – Allocation Effect

24 Student Managed Fund Attribution Analysis Spring 2014 Presentation Attribution Analysis – Selection Effect

25 Student Managed Fund Attribution Analysis Spring 2014 Presentation Attribution Analysis – By Sector

26 Risk Management Student Managed Fund Risk Management Spring 2014 Presentation Rigorous screening and analysis process Purchased half of stocks analyzed or pitched Diversification across sectors to avoid aggregation risk Stop-loss Focus on long-term performance, not concerned with short-term volatility

27 Lessons Learned Difficulties Record high market conditions Corporate social responsibility Lessons Corporate social responsibility initiative Company price tracking Teamwork and personal responsibility Student Managed Fund Lessons Learned Spring 2014 Presentation

28 Acknowledgements UConn Foundation Board Investment Advisory Board Pat Terrion Jeff Annello Dr. Chinmoy Ghosh Dr. Michel Rakotomavo Laurel Grisamer Student Managed Fund Acknowledgements Spring 2014 Presentation