Glide Path Powered By:
Asset Class: Target-Date Funds
Q4: December 31, 2013
Trademark Capital 2010 Fund ClassTarget R4 Trademark Capital Retirement 2010 Fund R4 Growth of $10,000 Class R4 Shares 05/31/2007 - 12/31/2013 Fund Description
The Trademark Capital Target Retirement 2010 Fund seeks a moderate level of total return and the preservation of purchasing power of accumulated assets prior to and beyond the target retirement date. The Capital Target Date Series are collective investment funds (“CIFs”) created by the TOPTrademark 10 HOLDINGS Hand Composite Employee Benefit Trust and sponsored by Hand Benefits & Trust Company, a BPAS company, that invest in the strategies of Trademark 1) Cash 6) Vanguard REIT ETF VNQ Capital which serves as the sub-advisor to the CIFs.
International Treasury ETF diversified 7) SPDR Barclays BWX asset mix The VOO Trademark/Wilshire glide path design adjustsBond the broadly on a quarterly basis, gradually moving toward a more conservative allocation VEA 8) Market Vectors Emerging Mkts Local Currency EMLC.K up to and “through” retirement to life expectancy. This approach takes into account investor behavior VO FTSE Emerging Markets Fund date, ETF which are 9) Vanguard VWO assumptions both before and after the target retirement used to create the slope of the glide path. VB 10) Vanguard Total Bond Market Index Fund;ETF BND
2) Vanguard S&P 500 ETF
Trademark Capital 3) Vanguard FTSE Developed Markets Portfolio Management Team ETF 4) Vanguard Mid Cap ETF Joseph Ezernack, MBA CEO & Chief Investment Officer 5) Vanguard Small Cap ETF
Don Beasley Managing Director
Allocation
FUND FACTS
R4
Investment Approach CUSIP
410235295
Trademark Capital
0.99% 0.12%
($11.10 per $1,000 invested)
V
Beta
60%
The asset allocation and glide path strategy is powered by Wilshire Fund Expense RatioAssociates. Investment selection, management and downside protection Weighted AveragebyETF overlay is managed Trademark Capital.
Benchmark Advisor
Alpha
80%
o
Risk Management Overlay expands in adverse market conditions
l a
R2
40%
t i l i t y
M
a
n a
0.32 g
contracts under positive market conditions
e
m
Sharpe Ratio
1.11% 0%
Morningstar Target Date 2010 TR
25
35 35
40
45
e
6.18% n t
0.59
Annual Portfolio Turnover 30
3.23% 0.20
Standard DeviationOverlay Risk Management
20%
Risk Management Overlay
Fixed Income
FUND DATA1
100%
Share Class
Total Expense Ratio*
Equity
Retirement Age 50
55
60
65
119%
70
75
Maturity Age 80
*The fund expense ratio has 44 bps of service fees payable to the plan’s service Inception Date 2/1/2011 Trademark Management, is a expense ratio and the weighted providers. The Capital total expense ratio includesInc. the fund ecember 31, 2013 Young Savers Mature Accumulators Near-Retirement Transitioners In-Retirement Harvesters 1 average ETF registered expense. federally investment advisor with a team Fund vs. the S&P(65+) 500 (34 and younger) (35-49) (50-65)
mark Capital 2010 Fund and Class R4 of experienced credentialed professionals. For
over Class two decades, Trademark Capital has been h of $10,000 R4 Shares 05/31/2007 - 12/31/2013
85
Age
The Risk Management Overlay, can reduce exposure to the “equity” glide path during
periods of elevated market risk. While the level of the Risk Management Overlay is lower YEAR RE steadfast in holding true to its core principles: CALENDAR for younger investors, the pre-determined maximum levels of protection increase up to and putting client’s interestTOP first 10 andHOLDINGS delivering REIT ETF 6) Vanguard VNQ2013 Q4: December 31, QTD goal-oriented solutions. The Trademark Capital “through” retirement. VOO on SPDR Barclays Bond ETF uard S&P 500 ETF 7)the BWX investment philosophy centers idea of InternationalAtTreasury age 65, the target retirement date, the maximum equity exposure is 55%. At age 85, the target maturity date, the maximum equity Trademark Capital Fund ClasstoR4 LocalisCurrency uard FTSE Developed Markets ETFlosing.” VEA 8) Market Vectors Emerging Mkts EMLC.K2010 3.37% 5 exposure 15%, which represents the lowest allocation equities along the glide path. 2010 Fund Class R4 “winning by not Trademark Capital
uard Mid Cap ETF
VO
9) Vanguard FTSE Emerging Markets Fund ETF
uard Small Cap ETF
VB
10) Vanguard Total Bond Market Index Fund;ETF
FUND FACTS Glide Path Consultant
Wilshire Associates
R4
1 $14,000 FUND DATA
Alpha
410235295 Beta Founded in 1972, Wilshire Associates (“Wilshire®”), 0.99% R2 a leading global independent investment consulting d Average ETF 0.12% Deviation and services firm, has more thanStandard four decades of Sharpe Ratio 1.11% ense Ratio* experience ($11.10 per $1,000 invested) providing risk analytics, investment Annualto Portfolio Turnover rk Morningstar Target Date 2010 TR consulting, and investment solutions institutional pense ratio has 44 bps of service fees payable to the plan’s service Inception Date investors worldwide. Wilshire serves in excess of 500 e total expense ratio includes the fund expense ratio and the weighted xpense. organizations in 20 countries representing assets totaling approximately US $7 trillion.*
ense Ratio
Trustee
Hand Benefits & Trust Company Hand Benefits & Trust Company (HB&T), a BPAS company, is a state-chartered trust company serving the retirement industry since 1963. HB&T, headquartered in Houston, is regulated by the Texas Department of Banking and is one of the country’s largest full service trust companies dedicated to retirement plans.
*Assets are as of December 31, 2011, based on data published in the December 24, 2012 issue of Pensions and Investments.
TOP 10 HOLDINGS
CALENDAR REIT ETF 6) Vanguard
3.23%
$13,000
1) Cash
0.20
2)$12,000 Vanguard S&P 500 0.32 ETF 6.18% 3)$11,000 Vanguard FTSE Developed Markets ETF 0.59
4)$10,000 Vanguard Mid Cap ETF
119%
5) $9,000 Vanguard Small2/1/2011 Cap ETF $8,000 $7,000
1
Fund vs. the S&P 500
$13,279.04
VOO
Bond ETF 7) SPDR Barclays International Treasury 12/31/2007
VEA
8) Market Vectors Emerging Mkts Local Currency
$12,576.75
Trademark Capital 2010 Fund Class R4
0.00%
Growth of $10,000
$10,587
QTD
3.37%
Morningstar Target Date 2010 TR
3.13%
Fund Expense Ratio
Weighted Average ETF
VB
10) Vanguard Total Bond Market Index Fund;ETF
BND
YTD
1 Year
3 Year
5 Year
5.31%
2.27%
4.55%
8.28%
Beta 2
R
8.28%Morningstar 6.15%
Inception to Date 4.40%
4.46%
5.31%
*The fund expense ratio has 44 of bps$10,000 of service fees payable to the plan’s service $10,587 $10,633 $11,465 $12,415 Growth Inception Date providers. The total expense ratio includes the fund expense ratio and the weighted $14,000 0.00% -22.46% 22.05% 10.55% Morningstar average ETF expense.Target Date 2010 TR
$12,071
$12,609
$13,279
0.75%
9.65%
18.28%
$10,050
$10,594
$11,617
$12,577
$13,000
Growth of $10,000
$7,793
$9,511
$10,515
-22
$7
3.23%
0.20
6.18%
Sharpe Ratio ($11.10 per $1,000 invested) 1.11% 12/31/2007 12/31/2008 12/31/2009 12/31/2010 12/31/2011 12/31/2012 12/31/2013
Annual Portfolio Turnover Benchmark Morningstar Target Date 2010 TR 7.83% 0.00% 0.43% 8.29% -2.77% Trademark Capital 2010 Fund Class R4
$1
0.32
Target Date 20103.54% 10.05%
Standard Deviation
CALENDAR YEAR HYPOTHETICAL & ACTUAL RESULTS ($) 5/31/07 - 12/31/13
Total Expense Ratio*
0
VWO
410235295
0.12%
EMLC.K
9) Vanguard FTSE Emerging Markets Fund ETF
5.31%
2010 Trademark Fund0.99% R4
BWX 12/3
VO
Morningstar Target Date 2010 TR 1 0.00% FUND DATA Growth of $10,000 $10,050 CALENDAR YEAR RETURNSR4 (%) - Alpha CLASS R4 SHARES
Trademark Capital 2010 Fund Class R4
8
YEAR HYPOTHETICAL VNQ &
FUND FACTS
Share Class CUSIP
3.13%
2007-05 2007-07 2007-09 2007-11 2008-01 2008-03 2008-05 2008-07 2008-09 2008-11 2009-01 2009-03 2009-05 2009-07 2009-09 2009-11 2010-01 2010-03 2010-05 2010-07 2010-09 2010-11 2011-01 2011-03 2011-05 2011-07 2011-09 2011-11 2012-01 2012-03 2012-05 2012-07 2012-09 2012-11 2013-01 2013-03 2013-05 2013-07 2013-09 2013-11
ss
VWO
Growth of $10,000 Class R4 Shares 05/31/2007 - 12/31/2013 Morningstar Target Date 2010 TR BND
0.59
119%
2/1/2011
Fund vs. the S&P 500 $12,755.77
$12,000 Illustrates a $10,000 investment made on 5/31/2007 with no additional deposits. Performance $11,000 prior to February 1, 2011 is back-tested while performance after February 1, 2011 is based on actual results. Hypothetical, back-tested performance information for the Fund is for illustrative purposes only and does not represent actual Fund performance. $12,085.08 $10,000 back-tested performance has inherent limitations and is not indicative of future results. No representation is being made Hypothetical, that the Fund will achieve performance similar to that shown. The hypothetical performance does not reflect brokerage fees but is net of $9,000 stated Fund expenses. Trademark Capital 2010 Fund Cl $8,000 $7,000
Morningstar Target Date 20
000 invested)
1.11%
rget Date 2010 TR
able to the plan’s service nse ratio and the weighted
Sharpe Ratio
0.59
Annual Portfolio Turnover
119%
Inception Date
2/1/2011
vs. the S&P 500 Trademark Capital TargetFund Retirement 2010 Fund R4 1
CALENDAR YEAR RETURNS (%) - CLASS R4 SHARES QTD
YTD
1 Year
3 Year
Trademark Capital 2010 Fund Class R4
3.37%
5.31%
5.31%
2.27%
4.55%
Inception to Date 4.40%
Morningstar Target Date 2010 TR
3.13%
8.28%
8.28%
6.15%
10.05%
3.54%
5 Year
Past Performance is no guarantee of future results and theCALENDAR actual performance the benchmark and the may beRESULTS lower or higher than the hypothetical past performance shown above. Fund returns are YEARofHYPOTHETICAL & Fund ACTUAL ($) 5/31/07 - 12/31/13 calculated net of fees. Fund returns are compared to the Morningstar Target Date 2010. Performance prior to February 1, 2011 is back-tested while performance after February 1, 2011 is based on actual results. Date prior to actual inception is representative of the manager’s performance of a like strategy. Inception date used in12/31/2009 the hypothetical return is May 31, 2007. 12/31/2012 12/31/2013 12/31/2007 12/31/2008 12/31/2010 12/31/2011
Trademark Capital Target Retirement 2010
Trademark Capital 2010 Fund Class R4
Target and Actual Allocation
Growth of $10,000
0.00%
0.43%
7.83%
8.29%
-2.77%
4.46%
5.31%
$10,587
$10,633
$11,465
$12,415
$12,071
$12,609
$13,279
$10,050
Real Assets $7,793 $9,511 5%
$10,515
$10,594
$11,617
$12,577
12/31/2013 0.00% Target -22.46% Allocation 22.05% 10.55%
Target Date 2010 TR The actual allocation of the fund may differMorningstar from the target allocation depending on the current position of the Risk Growth of $10,000 Management Overlay.
Other Bonds 9%
The Risk Management Overlay can reduce exposure to the “equity” portion of the glide path when our model indicates periods of elevated market risk. The Risk Management Overlay provides higher levels of capital protection up to and “through” retirement for the near-dated Funds [2010, 2020 and 2030], while allowing for a higher standard deviation (i.e. up/down volatility) in the longer-dated Funds [2040 & 2050].
Key Considerations
A one-step, broadly diversified, ‘managed for you’ solution that adjusts to an investors age, as well as, changes in the financial markets. A winning combination - Combining Wilshire’s glide path expertise with a proprietary downside protection strategy that has been used in client accounts since 1991. A balanced approach - The management style not only balances risk with return, but also seeks to improve performance per unit of risk over traditional “diversified” portfolios. A great value - The underlying securities are exchangetraded funds (ETFs) resulting in significant cost savings.
12/31/2013 Actual Allocation 0.75% 9.65% 8.28% Other Bonds 9%
Int'l Stocks 14%
Cash & TIPS 36%
Q4: December 31, 2013
Trademark Capital Target Retirement Fund
Before 1949
2010
1950-1959
2020
1960-1969
2030
1970-1979
2040
After 1980
2050
Int'l Stocks 13%
Cash & TIPS 38%
US Stocks 36%
US Stocks 35%
Trademark Capital 2010 Fund Class R4 Growth of $10,000 Class R4 Shares 05/31/2007 - 12/31/2013 TOP 10 HOLDINGS 6) Vanguard REIT ETF
1) Cash
VNQ
2) Vanguard S&P 500 ETF
VOO
7) SPDR Barclays International Treasury Bond ETF
BWX
3) Vanguard FTSE Developed Markets ETF
VEA
8) Market Vectors Emerging Mkts Local Currency
EMLC.K
4) Vanguard Mid Cap ETF
VO
9) Vanguard FTSE Emerging Markets Fund ETF
VWO
5) Vanguard Small Cap ETF
VB
10) Vanguard Total Bond Market Index Fund;ETF
BND
FUND DATA1
FUND FACTS
Year of Birth
Real Assets 5%
Share Class
R4 410235295
CUSIP
Alpha
Fund Expense Ratio
0.99%
R2
Weighted Average ETF
0.12%
Standard Deviation
Total Expense Ratio* Benchmark
($11.10 per $1,000 invested)
1.11%
Morningstar Target Date 2010 TR
*The fund expense ratio has 44 bps of service fees payable to the plan’s service providers. The total expense ratio includes the fund expense ratio and the weighted average ETF expense.
IMPORTANT RISK CONSIDERATIONS
The Trademark Capital Target Retirement Funds are Collective Investment Funds (CIFs) sponsored by Hand Benefit & Trust Company. The CIFs are not mutual funds and shares are not deposits of Hand Benefits & Trust, a BPAS company, or Trademark Capital Management, and are not insured by the Federal Deposit Insurance Corporation or any other agency. The CIFs are securities which have not been registered under the Securities Act of 1933 and are exempt from investment company registration under the Investment Act of 1940. As defined in the Declaration of Trust and Participation Agreement documents, the Funds are available for investment by eligible qualified retirement plan trusts only. Principal invested is not guaranteed at any time, including at or after the fund’s specific target retirement date. Participants and beneficiaries may experience losses near, at or after the target date and there is no guarantee that the investment will provide adequate retirement income. The participants and beneficiaries on whose behalf assets are invested in a QDIA have the right to direct the investment to any other investment alternative under the plan, subject to any fees or limitation that may apply to such transfer under the plan. Principal Risks - Any of the principal risks summarized below may adversely affect the Fund’s net asset value, performance and ability to meet its investment objective. Active Management: The investment is actively managed and subject to the risk that the advisor’s usage of investment techniques and risk analyses to make investment decisions fails to perform as expected, which may cause the portfolio to lose value or underperform investments with similar objectives and strategies or the market in general. Target Date: Targetdate funds, also known as lifecycle funds, shift their asset allocation to become increasingly conservative as the target retirement year approaches. Still, investment in target date funds may lose value near, at, or after the target retirement date, and there is no guarantee they will provide adequate income at retirement. Underlying Fund/Fund of Funds: A portfolio’s risks are closely associated with the risks of the securities and other investments held by the underlying or subsidiary funds, and the ability of the portfolio to meet its investment objective likewise depends on the ability of the underlying funds to meet their objectives. Investment in other funds may subject the portfolio to higher costs than owning the underlying securities directly because of their management fees. ETF: Investments in exchange-traded funds generally reflect the risks of owning the underlying securities they are designed to track, although they may be subject to greater liquidity risk and higher costs than owning the underlying securities directly because of their management fees. Shares of ETFs are subject to market trading risk, potentially trading at a premium or discount to net asset value. Suitability: Investors are expected to select investments whose investment strategies are consistent with their financial goals and risk tolerance. The target-date fund should be selected based on factors in addition to age or retirement date, including investment objectives, time horizon, risk tolerance and fees and the stated asset allocation may be subject to change. It is possible to lose money by investment in the fund including at and after the target date. The glide path methodology assumes at the target retirement age the participant or beneficiary withdraws 5% of the account value per year. The Trademark Capital Target Retirement Funds performance prior to February 1, 2011 represents hypothetical back-tested results for the funds while performance after February 1, 2011 is based on actual results. The performance results reflect the reinvestment of dividends and other account earnings, and the maximum Fund investment management fee that would have been charged by Trademark had Trademark managed the Fund during the corresponding
3.23%
Beta
0.20 0.32 6.18%
Sharpe Ratio
0.59
Annual Portfolio Turnover
119%
Inception Date
2/1/2011 1
Fund vs. the S&P 500
CALEND
time period plus estimated corresponding Fund expenses (estimated at 0.90% annually), and any separate fees assessed directly by each security (mutual funds, exchange-traded funds, etc.) that comprised the portfolio. Therefore all results are net of fees. As market conditions fluctuate, the investment return and principal value of any investment will change. Diversification may not protect against market risks. There are risks involved with investing, including possible loss of principal. Different types of investments and/or investment strategies involve varying levels of risk, and there can be no assurance that any specific investment or investment strategy (including the investments purchased and/or investment strategies devised or undertaken by Trademark) will be profitable. Trademark Capital 2010 Fund Class
R4
3
Past performance may not be indicative of future results. Therefore, no current or prospective client should assume that future Morningstar Target Dateindex. 2010 TR performance will be profitable, equal the performance results reflected, or equal the corresponding historical benchmark The historical performance results for the benchmark does not reflect the deduction of transaction and custodial charges, or the deduction of an investment management fee, the incurrence of which would have the effect of decreasing indicated historical performance results. Benchmarks are unmanaged and one cannot invest directly in a benchmark. The historical performance results for the benchmark is provided exclusively for comparison purposes only, so as to provide general comparative information to assist an individual client or prospective client in determining whether Trademark Funds meets, or continues to meet, his/her investment objective(s). Please Also Note: (1) performance results do not reflect the impact of taxes; (2) It should not be assumed that account holdings will correspond directly to any benchmark index; and, (3) comparative indices may be more or less volatile than the Trademark Funds. Trademark Capital 2010 Fund Class R4
3
CALENDAR YEAR HYPOTH
The performance results (5/31/07-12/31/10) reflect hypothetical, back-tested results, that were achieved by means of the retroactive of $10,000 application of a back-tested portfolio and, as such, the corresponding results have inherent limitations, including: Growth (1) Fund results do not reflect the results of actual trading using client assets, but were achieved by means of the retroactive application of each of the referenced portfolios, certain aspects of which may have been designed with the benefit of Morningstar hindsight; (2) back-tested performance Target Date 2010 TR may not reflect the impact that any material market or economic factors might have had on the adviser’s use of the hypothetical portfolio if the portfolio had been used during the period to actually mange client assets; and, (3) Trademark’s clients may have Growth experienced investment results during the corresponding time periods that were materially different from those portrayedof in $10,000 the portfolio. Hypothetical performance results have been compiled solely by Trademark, are unaudited, and have not been independently verified. Trademark maintains all information supporting the performance results in accordance with regulatory requirements. Information pertaining to Trademark’s advisory operations, services, and fees is set forth in Trademark’s current disclosure statement, a copy of which is available from Trademark upon request. Performance results have been compiled solely by Trademark, are unaudited, and have not been independently verified. Trademark maintains all information supporting the performance results in accordance with regulatory requirements. Benchmark performance reflects results as reported directly by each respective index and/or obtained by Trademark from other reliable sources, and have not been independently verified by Trademark.
For more information, contact your financial advisor or call Trademark Capital at 1-800-808-8960 www.TrademarkCapital.com
Glide Path Powered By:
12/3
0
$1
0
$1