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CHAMPION CAPITAL RESEARCH

EMERGENTES

6750 W Loop South, Suite 230 Bellaire, Texas 77401 info@championcr.com 713-974-8883


TABLE OF CONTENTS

Background ..........................................................................................

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Performance .........................................................................................

Page 11

Investment Process ...........................................................................

Portfolio Attribution ……………………………………………………. Biographies…………………………………………………………………. Client List……………………………………………………………………. Fee Schedule………………………………………………………………..

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CHAMPION CAPITAL RESEARCH Incorporated 2003 and SEC registered 2005 Owned 100% by employees Manage with same team for over ten years Follow uniform fiduciary standards of care Manage assets in excess of $617 million Total Firm Assets

2006-2007 - Private Corporation, Foundation, High Net Worth Individuals, Trust Departments

$700 $600

Millions

$500 $400 $300

2007-2008 - Asset Management Firms (IBD/RIA)

$200 $100 $-

2006

2007

2008

2009

2011

2013

2009-2013 - Public Pensions & Foundations


TEAM Team Member

Responsibility

M.K. Campion, PhD., CFA, AIFA

Founder & CIO

25 Years

Roger Muns, CFA, CPA

Portfolio Strategist

20 Years

Bruce Aichler

Information Technology

25 Years

Eugene Lee, MBA, AIFA Rabab Aldhahi* Blanca Gomez

Portfolio Manager

Portfolio Reporting Accounting

Experience 15 Years 5 Years

12 Years

* Rabab is in the process of completing her CPA license.

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CHAMPION CAPITAL RESEARCH Fiduciary/AIFA Consulting Tax Efficient Solutions Services Lectures Education Advisor Symposiums Champion Capital Research Macroeconomic Research Research Quantitative Research Products Emergentes Portfolios Panoptic

Alterna

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WHAT WE OFFER Independent Research Transparency Fiduciary Education Asset Allocation - use top town fundamental and

macroeconomic analyses to determine investment opportunities

Diversified Portfolios – countries, industries, sectors, risk levels, currencies and positions

Disciplined investment management process

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INVESTMENT PROCESS ORIGINATE Review global and sector growth trends, then analyze and collaborate.

FORMALIZE

Rank opportunities by growth, valuations, risks, momentum.

IMPLEMENT

Review parameter & compliance reports, place trades and monitor . Modify if necessary.

MONITOR

Evaluate profits, volatility and tracking error, act when outside policy, repeat process. 7


Target Allocation

Market Volatility Management

 Re-allocation done quarterly for individual

holdings  Allocate no more than 20% to any one position or country or 10% to any one sector Drift Parameters

 Conduct portfolio attribution analysis monthly  Re-balance at 5 percent deviation

 Monitor VIX levels greater than 25 to establish stop-loss process in event of severe market declines  Conduct correlation analysis among assets to generate superior portfolio mean variance

Risk Management

Cash Management

Technical Analysis

 Use only with respect to volatility analyses  Employ only in sell strategy, not buy strategy.

 Use cash in high volatility periods.  Maximum allocation will generally be 20 percent with the typical range of 10-20 percent  Discretionary use of cash throughout all market conditions to take advantage of tactical investment opportunities. 8


SELL DISCIPLINE Review a holding when it no longer ranks favorably in multi-factor model Trim a position when its allocation limit is reached  Our strategy is low turnover and rules based to trade quarterly  Price targets are not set

Trade quarterly during normal market environments 

If the market is deemed over-priced, we will implement the quarterly portfolio selections in at least two sequences at least two weeks apart in order to mitigate price point concentration

Seek to minimize portfolio turnover

 Our research rules based process is expected to deliver between 5 and 20 percent maximum turnover in any given year

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EMERGENTES

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8.0

6.0

PERFORMANCE - as of March 31

4.0 2.0 0.0

-2.0 -4.0 -6.0

Emergentes (gross) Emergentes (net) Benchmark

Qtr 0.42 0.25 -3.56

YTD 0.42 0.25 -3.56

3 Year Profile

Emergentes

Benchmark

Sharpe Ratio

0.33

0.26

Alpha

1.73

0.00

Info Ratio

0.01

0.00

1 Year 5.87 5.17 1.66 3 Year Profile

3 year 4.16 3.14 3.13

5 Year 2.30 1.26 -4.17

Emergentes

Benchmark

Standard Deviation

24.48

30.35

Beta

0.98

1.00

Downside Risk

17.88

21.81

* Benchmark is MSCI ACWI ex US since inception to 12/2009 and MSCI EM 12/2009 to Present Inception Date: April 2003. As of March 2013. Past performance is no guarantee of future results. Please note portfolio statistics are gross of fees.

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PORTFOLIO STATISTICS 16.00 14.00 12.00 10.00

Emergentes

8.00

MSCI EM

6.00 4.00 2.00 0.00 Port 2.49

Dividend Yield

Dividend Yield Bench +/2.60

-0.11

Price/Earnings

Price/Book

Price/Sales

Port

P/E Bench

+/-

P/B Port Bench

+/-

P/S Port Bench

+/-

15.17

12.36

2.81

1.85

0.26

1.11

0.11

1.59

1.00

Port

Market Cap Bench +/-

41,470 47,757 (6,287)

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COUNTRY ALLOCATION 100%

United States

90%

Taiwan

80%

South Korea

70%

Singapore

60%

Japan

50%

Indonesia

40%

Hong Kong

30%

China

20% 10%

0% Dec-12

Jan-13 % Weight Brazil Chile China Hong Kong Indonesia Japan Singapore South Korea Taiwan United States

Feb-13 Dec-12 1.64 8.41 16.32 7.04 7.61 0.66 5.70 5.63 12.90 21.49

Mar-13 31-Jan-13 1.67 8.80 16.72 6.91 7.70 0.70 5.65 5.18 12.59 21.40

Apr-13 28-Feb-13 1.62 8.44 15.93 6.58 8.60 0.70 5.62 5.44 12.66 21.40

Chile

Brazil

29-Mar-13 30-Apr-13 1.76 1.90 8.61 7.97 15.64 16.80 6.52 7.31 8.72 7.89 0.72 3.50 5.79 6.03 5.31 5.41 12.69 13.49 21.67 6.71

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SECTOR ALLOCATION 100%

90% 80% 70% 60% 50% 40% 30% 20% 10%

0% Dec-12

Jan-13

Feb-13

% Weight Utilities Telecom Services Stocks Materials Information Technology Industrials Health Care Funds Financials Energy Consumer Staples Consumer Discretionary Cash Bonds

Mar-13

Dec-12 31-Jan-13 3.21 3.30 5.24 5.12 0.01 0.01 6.92 6.87 10.69 10.37 7.57 7.61 2.16 2.13 0.00 0.00 20.19 20.90 5.48 5.47 8.36 8.34 11.10 10.99 0.08 0.08 18.99 18.81

Bonds Cash Consumer Discretionary Consumer Staples Energy Financials Funds Health Care Industrials Information Technology Materials Stocks Telecommunication Services Apr-13 Utilities 28-Feb-13 29-Mar-13 30-Apr-13 3.23 3.50 3.79 5.02 4.90 5.55 0.01 0.00 0.00 6.62 6.18 7.53 10.67 11.13 13.03 7.68 7.89 9.59 2.20 2.38 4.31 0.00 0.00 0.00 20.91 20.53 23.96 5.23 4.99 6.02 8.32 8.53 11.68 10.92 10.98 13.49 0.38 0.07 1.05 18.81 18.92 0.00

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BIOGRAPHIES – Lead Portfolio Managers Mary Kathryn Campion, Ph.D., CFA, AIFA

Eugene Lee, MBA Mr. Lee has been active in the due

Dr. Campion is the firm’s founder

diligence of traditional and

and chief investment officer. She is

alternative managers and funds for

responsible for the firm’s

over eight years. He is currently

econometric analyses that

generate ideas for investment

strategies. She has 25 years of

experience in the

investment industry as a portfolio strategist and financial

economist. Her professional experience includes advising insurance

companies

on

immunization

strategies,

fiduciary consulting to retirement plans and pension

funds, managing strategic and tactical asset allocation strategies, and performing due diligence analyses on financial professionals. Dr. Campion holds a B.A. from Rice

University and an M.A. and Ph.D. in Economics from the University of Houston. She maintains Series 7 and 63 NASD security licenses.

responsible for portfolio allocations to

maximize

risk

adjusted

returns

through

diversification and complementary manager selection. He has done this with mutual funds, variable annuity sub-accounts, separate account managers and hedge

funds. Prior to his engagement with Champion, Eugene

was a bond portfolio analyst with Scudder Investments, and a research analyst with US Fiduciary. He received his MBA from the University of Chicago GSB with a focus on accounting and finance. He holds a BA in economics from the University of Michigan- Ann Arbor.


CLIENT and Reference LIST Texas Public Employees Retirement System (TEXPERs) Texas Local Firefighters Retirement Association (TLFFRA) Houston Municipal Employees Pension System (HMEPs) First Victoria National Bank and Trust Envestnet Asset Management Private Foundations and Profit Sharing Plans High Net Worth Individuals

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