Interim Report Student Managed Fund MBA class of 2004 November 14, 2003

2 Agenda  Investment Philosophy & Approach  Investment Process  Sector Allocation  MBA Fund Holdings & Investment Criteria  Future Outlook

3 Investment Philosophy  Strive to outperform the S&P500  Selecting stocks with strong growth potential  Closely monitoring the portfolio  Rely on fundamental analysis  Historical performance  Business models  Economic outlook for the industry  Equal sector allocation  Subject to re-evaluation due to economic changes and the increased experience of the group  Long-term (5 year) investment horizon

4 Stock Market Universe Sector Allocation and Industry Selection Traded Stocks Business Model Analysis Competitors and Market Share Products and Customers Industry Outlook Economic Situations Risk vs. Return Investment Approach

5 Stock Selection Criteria We look for:  Solid financials  Strong management  Earnings growth  Attractive valuation relative to the index  Higher return/risk relative to industry

6 Stock Selection Criteria (continued) Buy Criteria:  Steady growth rates  Intrinsic value > market value  Above average yields  Upside-downside ratio of at least 2 Sell Criteria:  Stock reaches its price objective  Industry-sector weighting exceeds predetermined limits  Risk/reward profile deteriorates  Earnings figures lower than estimates

7 Investment Process  Sector Allocation/Equity Identification  Sector Assignments  Filtering  Equal Allocation  Fundamental Analysis  Financial Statements Analysis  Trend Analysis

8 Investment Process (continued)  Valuation  Business Model Analysis  Intrinsic Value  PEG Ratio  NAICS  CAPM  Risk Factors (Internal & External)  Performance Monitoring  Stop Loss Measures (20%)  Appreciation Reevaluation (30%)  Continuous Monitoring & Dynamic Response

9 S&P 500 Sector Allocation Big Four: Financials Information Technology Consumer Discretionary Health Care

10 SMF Sector Allocation As of 11/12/03 Budget not yet fully allocated

11 SMF Holdings Equal weightings of sectors and initial investments ($10,000 to $15,000) Ticker Date of Purchase Quant ity Purchase Price Price (11/13/03) Market Value (11/12/03) % Basic Gain ALV10/29/03300$32.43$33.68$10, % CD11/12/03700$21.03$21.40$14, % COGN10/31/03300$34.80$35.58$10, % GILD11/12/03300$53.30$55.04$16, % FDC11/04/03280$35.90$37.08$10, % HOTT11/12/03550$27.43$27.53$15, % JEC10/24/03200$47.86$43.57$8, % OCR11/05/03350$36.93$38.36$13, % TOL 10/14/03 11/04/ $34.96 $38.01 $38.79$9, % WFC11/05/03250$55.23$57.16$14, %

12 SMF Holdings  Amount Invested in Individual Equities = $121,537.8 Market Value = $123, % Basic Gain/Loss = 1.96%  Initial Holdings on 9/4/03 = $251, Market Value on 11/12/03 = $ 261,250.76* Total % Basic Gain/Loss = 3.78%*  S&P 500 Return (9/4/03-11/13/03) = 2.96% (*Market value of SMF holdings at close on 11/13/03)

13 Investment Criteria QuantitativeQualitative ROA Industry Growth ROECompany Market Share ROICCorporate Governance Growth in EPSInstitutional Ownership Free Cash Flow/Net IncomeInsider Trading Gross Margin (%)Market Power Product Differentiation Low-cost Producer Customer Relationship Retention Ratio Economic Profit Debt/Equity Beta Quantitative & qualitative factors checked across industries

14 Qualitative Investment Criteria - Portfolio ALVCOGNFDCJECOCRTOLWFC Industry Growth 23.23%6.80%10.81%-5.0%6.12%20.34%6.90% Company Market Share 31% airbags 33% sidebags 15% steering wheel 14% safety electronics 0.40% 75% money transfer 40% merchant processing 25% card- issuing services 12.58%1.4%4.78%17.71% Market Power  Product Differentiation  Low-cost Producer  Customer Relationship High Medium High Medium High Medium High Corporate Governance 8/117/85/96/96/127/11 Data not available Institutional Ownership 99.05%66.60%95%77.80%95.6%60.30%67% Insider Trading 0.07%0%1.13%2.70%25%5.5%0.11%

15 ALVCOGNFDCJECOCRTOLWFC ROA3.72%9.13%5.00%5.30%3.50%7.67%1.41% ROE7.30%15.80%26.93%13.67%7.00%20.83%15.53% ROIC10.12%16.93%18.17%23.93%19.93%13.04%10.54% Cost of Capital7.29%8.94%8.00%7.87%6.80%7.02%6.68% Economic Profit3.89M40.4M718M73.05M19.08M90.29M2.091B EPS Growth63.70%6.96%23.51%34.53%44.77%29.43%16.29% FCF/NI68.30%152%129.46%71.20%46.3%-109%n/a Gross Margin17.91%n/a42.17%13.73%29.64%8.95%n/a Ret. Ratio51%100%96%100%90.67%100%61% Debt/Equity Beta Quantitative Investment Criteria - Portfolio

16 Qualitative Investment Criteria - Portfolio ALVCOGNFDCJECOCRTOLWFC Industry Growth 23.23%6.80%10.81%-5.0%6.12%20.34%6.90% Company Market Share 31% airbags 33% sidebags 15% steering wheel 14% safety electronics 0.40% 75% money transfer 40% merchant processing 25% card- issuing services 12.58%1.4%4.78%17.71% Market Power  Product Differentiation  Low-cost Producer  Customer Relationship High Medium High Medium High Medium High Corporate Governance 8/117/85/96/96/127/11 Data not available Institutional Ownership 99.05%66.60%95%77.80%95.6%60.30%67% Insider Trading 0.07%0%1.13%2.70%25%5.5%0.11%

17 ALVCOGNFDCJECOCRTOLWFC ROA3.72%9.13%5.00%5.30%3.50%7.67%1.41% ROE7.30%15.80%26.93%13.67%7.00%20.83%15.53% ROIC10.12%16.93%18.17%23.93%19.93%13.04%10.54% Cost of Capital7.29%8.94%8.00%7.87%6.80%7.02%6.68% Economic Profit3.89M40.4M718M73.05M19.08M90.29M2.091B EPS Growth63.70%6.96%23.51%34.53%44.77%29.43%16.29% FCF/NI68.30%152%129.46%71.20%46.3%-109%n/a Gross Margin17.91%n/a42.17%13.73%29.64%8.95%n/a Ret. Ratio51%100%96%100%90.67%100%61% Debt/Equity Beta Quantitative Investment Criteria - Portfolio

18 Outlook Strong economic growth likely  Adjust sector allocation to economic outlook  Monitor portfolio to maximize value  Invest funds quickly, but wisely  Beat benchmark Positive market returns expected

19 MBA Fund Managers  Michael Appell  Jessie LeBlanc  Tanzhuo Liu  Saipriya Menon  Geoffrey Munger  Ganesh Padmanabhan  Anjana Radhakrishnan  Heather Utter  Wiebke Wanner-Borchardt

20 Thank you University of Connecticut Foundation Inc. Investment Advisory Board Steering Committee Dr. Chinmoy Ghosh

21 Questions