Taylor Captline Matthew Chadwell Hadd Francis

 41 companies  11.82% of S&P 500  Sector Industries include:  Agricultural Products  Brewers  Distiller and Vinters  Food Distributors  Household Products  Hypermarkets and Supermarkets  Packaged Foods and Meats  Personal Products  Retail – Drugs  Retail – Food  Soft Drinks  Tobacco

COMPANY NAME MRKT CAP 5/1/09 (millions)% of Sector WAL-MART STORES $ 196, % PROCTER & GAMBLE 145, % COCA-COLA 98, % PEPSICO 77, % PHILIP MORRIS INTL 74, % CVS/CAREMARK 46, % KRAFT FOODS 34, % ALTRIA GROUP 33, % WALGREEN 31, % COLGATE-PALMOLIVE 30, % Top 10 account for 73.4% of sector market cap.

As of 5/1/09 Number of CompaniesMKTCAP Level as of 5/1/09DailyMTDQTDYTD S&P $ 7,626, % 9.98%-2.85% Energy39 $ 977, % 8.01%-5.04% Materials28 $ 256, % 15.45%12.19% Industrials58 $ 800, % 19.02%-6.89% Consumer Discretionary81 $ 717, % 17.75%7.61% Consumer Staples41 $ 917, % 3.51%-8.20% Health Care54 $ 1,048, % -1.02%-9.46% Financials80 $ 908, % 20.12%-15.31% Information Technology75 $ 1,404, % 12.69%17.15% Telecommunications Services9 $ 285, % 3.68%-5.10% Utilities35 $ 310, % 3.09%-9.14%  Consumer Staples performing below S&P 500 daily, MTD, QTD and YTD Information gathered from S&P500 website

Consumer Staples is currently weighted at 13.06% in the SIM compared to 12.04% in the S&P 500. It is currently overweight by 102 bps.

 Life cycle Domestic International

 Business cycle  Bernanke testified today that recession should end later this year.

Competition High Supplier power Low Substitutes High Buyer power High Barriers to entry High

Forward P/E to S&P 500 Trailing P/E to S&P 500

Price Net Profit Margin to S&P 500 ROE to S&P 500

 AGPRD – mean reversion  Hit hard by recession  HYPMK – stable  TBACO – stable but not showing signs of large growth MeanCurrent AGPRD BRWRS DSTLR FOODD HSHLD HYPMK PKGFD CSMTG RTDRG FOODR139.8 BEVGS TBACO

Price to Book Price to Sales

Mean Reversion Price to CF

Price to Sales Price to Book

 Current values extremely close to mean values Price to CF

Sector P/E P/E TOP/EP/E TOP/E LATEST5 YR 10 YR REL TO 4 QTRSAVG SPX CONSUMER DISCRETION CONSUMER STAPLES ENERGY FINANCIALSNM14.5NM15.4NM HEALTH CARE INDUSTRIALS INFORMATION TECH MATERIALS TELECOMMUNICATION UTILITIES

 Reduce sector weight in SIM portfolio by 124 basis points to bring in line with S&P 500.  Economic indicators signal recovery  Sector appears fairly valued

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