For quite some time, institutional equity and fixed income investors have known that US capital markets have been losing market shares to overseas competitors. The US corporate bond market continues to face challenges from Latin American, Eurobond, Far East, and Australian bond markets. US equity markets continue to have declines in foreign initial public offerings, suggesting that they have also become less attractive. Our global strategies take advantage of international equity and sovereign debt markets by utilizing our global "top-down" view of and "bottom-up" approach to debt and equity analysis. These strategies are customized solutions to match each client's objectives, risk tolerance, liquidity requirements, and marginal tax rates for total-return optimization. They may be structured as either a stand-alone portfolio or as an overlay to a fixed income portfolio already managed by SAC. For further information, please read our Disclosure Statements.

Enhanced ETF

OBJECTIVES

• The strategy seeks to provide principal protection and an opportunity for long-term capital appreciation
• The strategy allows investors to diversify their portfolios into high-quality fixed income and in a 'fund of funds' strategy that invests solely in exchange-traded funds (ETFs)
• By opening up the equity universe to ETFs globally, it allows clients to diversify their portfolios by gaining exposure to global equities, forex, and commodities not represented in the US markets
• Provides a high degree of liquidity with an asset allocation heavily weighted with large, capitalized exchange-traded funds

INVESTMENT PHILOSOPHY

• Utilizes a disciplined Investment Selection Committee comprised of senior portfolio managers and research analysts
• Asset allocation is driven by a two-tier approach: a 'top-down' view of global markets followed by SAC's qualitative and quantitative 'bottom-up' approach
• Top-down macroeconomic and quantitative analysis is applied along with a client's objectives in 'globally' pinpointing those sectors and indices that provide the best investment opportunities
• Bottom-up individual security selection is utilized by senior portfolio managers based on relative value, credit-worthiness, and potential price and income appreciation of a particular sector and index in the context of our top-down view
• Portfolios are then adjusted accordingly within the constraints of individual client's requirements

INVESTMENT PROCESS

• The strategy will employ active management that is designed chiefly to manage duration and maturity according to a client's liabilities and commitments
• We then employ a crossover strategy that actively measures the dividend/growth yield value of a company's common stock versus comparable corporate debt instruments
• We will invest in corporate debt instruments when they offer superior returns over a common stock
• We diversify across sector, style, country, commodity, fixed income, and forex to systematically identify and provide market segments that exhibit positive strength, and to underweight ETFs that represent negative strength in the marketplace
• We customize and separately manage each portfolio so we can meet a client's individual goals, risk tolerance, and liquidity and tax requirements
• Portfolio duration is maintained within a +/-15% band around the corresponding benchmark to minimize market volatility within a client's portfolio
• Bottom-up individual ETF selection is utilized by portfolio managers based on relative value, credit-worthiness, and the potential price and income appreciation of a particular fund