Portfolio Guidelines

  • Typically 40–60 positions
  • Maximum position size is 7%
  • Top 10 holdings are typically greater than 30% of net assets
  • Maximum industry exposure is 20%
  • Maximum sector exposure is 30%

Market Capitalization

The portfolio typically invests at least 80% of its net assets in medium market capitalization
companies, defined as those companies with a market capitalization between $1.5 billion and
$20 billion (or, if greater, the maximum market capitalization of companies generally within
the capitalization range of the Russell Midcap Index) at the time of purchase.

Top Ten Equity Holdings
As Of December 31, 2016

Willis Towers Watson PLC Financials 3.8%
Loews Corp. Financials 3.7
Cimarex Energy Co. Energy 3.1
Whirlpool Corp. Cons. Discretionary 3.0
BankUnited, Inc. Financials 3.0
LifePoint Health, Inc. Health Care 2.7
Axalta Coating Systems Ltd. Materials 2.7
BorgWarner, Inc. Cons. Discretionary 2.7
Post Holdings, Inc. Consumer Staples 2.6
Boston Scientific Corp. Health Care 2.5
Total As % Of Net Assets 30.0%
Total Number Of Equity Holdings 60

This is presented as supplemental information.

Sector Allocation1
As Of December 31, 2016

Mid Cap Composite Russell Midcap Index Russell Midcap Value Index
Financials 27.3% 13.5% 19.9%
Cons. Discretionary 19.1 15.2 8.5
Industrials 9.9 13.6 12.6
Consumer Staples 9.5 5.0 3.2
Info. Technology 7.6 14.6 8.8
Health Care 5.3 9.0 4.2
Materials 3.4 5.7 6.0
Energy 3.1 6.5 10.6
Real Estate 2.8 9.8 13.9
Utilities 1.8 6.1 10.9
Telecom 0.0 1.0 1.4
Cash & Other 10.1 0.0 0.0

This is presented as supplemental information.

Portfolio Characteristics Vs. Benchmark2
As Of December 31, 2016

Mid Cap Composite Russell Midcap Index Russell Midcap Value Index
Median Forward P/E 19.0x 19.9x 19.1x
Median Trailing P/E 22.1x 22.8x 21.0x
Weighted Average Dividend Yield 1.1% 1.7% 2.2%
Median Price / Book 2.5x 2.8x 2.2x
Median Price / Sales 1.6x 2.1x 2.0x
Median Market Cap. $8.0B $6.3B $6.1B
Weighted Average Market Cap. $11.0B $13.2B $13.2B
Portfolio Turnover 5 Year 16% —   —  
Active Share3 vs. Core4 / Value5 Benchmark 93% / 92% —   —  
Upside/Downside Capture Ratio6 vs. Core Benchmark4 97% / 84% —   —  
Upside/Downside Capture Ratio6 vs. Value Benchmark5 94% / 90% —   —  

This is presented as supplemental information.

1 Cash & Other may include cash, treasuries, money market funds, and short duration fixed income funds

2 Source: FactSet.

3 Source: Morningstar Direct. Active share measures the difference between portfolio holdings and the benchmark. The higher the active share, the greater the difference.

4 The Russell Midcap Index is the core benchmark.

The Russell Midcap Value Index is the value benchmark.

Source: eVestment Analytics based on quarterly returns (gross of fees) from 1/1/14 – 12/31/16.

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