4th Quarter 2015 Review
ImportantDisclosureInformation:Pastperformancemaynotbeindicative
of futureresults.Accountinformationhasbeencompiledsolelyby
FiduciaryInvestmentAdvisors,LLC,hasnotbeenindependentlyverified,
and doesnotreflecttheimpact oftaxesonnon-qualifiedaccounts.In
preparing thisreport,FiduciaryInvestmentAdvisors,LLChasreliedupon
informationprovidedbytheaccountcustodian.Acopyofourcurrent
writtendisclosurestatementdiscussing ouradvisoryservicesandfees
continuestoremainavailableforyourreviewuponrequest.Historical
performanceresultsfor investmentindicesand/orcategorieshavebeen
providedforgeneralcomparisonpurposesonly,andgenerallydonotreflect
thedeductionoftransactionand/orcustodial charges,thedeductionof an
thededctionoftransactionand/orcstodialchargesthededctionof an
investmentmanagementfee, northeimpact oftaxes,theincurrenceof
whichwouldhavetheeffectof decreasinghistorical performanceresults.It
shouldnotbeassumedthatyouraccountholdingscorresponddirectlyto
anycomparativeindices.
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Glossary
Alpha - A measure of return that cannot be attributed to the market. Thus, it can be thought of as how the portfolio would have preformed if the market had experienced no gain or loss.
Alpha is value added over the benchmark; the higher the alpha, the better.
Batting Average - Ratio defining excess performance of a portfolio in comparison to its benchmark, measured, typically, over a series of calendar quarters.
Beta - Indicates the level of risk relative to the market. A beta of more than one suggests more volatility than the market, while a beta of less than one indicates less volatility
than the
market. Beta is also referred to as systematic risk.
Down Market Capture Ratio - A measure of a portfolio's performance in down markets. The lower a portfolio's down market capture ratio, the better the manager protected capital
during a market decline. Ex: a value of 90 suggests that a manager's losses were only 90% of the market loss when the market was down. A negative down market capture ratio indicates
that a manager's returns rose while the market declined.
Information Ratio - Measures a portfolio's excess return per unit of risk. The ratio is used to measure the value added from the information a manager possesses, adjusted for the risk
taken in making active investment decisions. The greater the information ratio, the better.
Performance vs Peers - Trailing return and calendar year returns reveal how the portfolio has performed versus a peer group of portfolios of similar style.
R-Squared - This number reflects the correlation between a portfolio's movements and the movements of its comparative benchmark. An R-squared of 100 indicates that there is perfect
correlation between the movements of a portfolio and its benchmark, while an R-squared of 0 indicates that there is no correlation between the portfolio's movements and the
benchmark's movements.
Return vs Standard Deviation Scatterchart - This graph shows a risk/reward relationship of the portfolio and its relative benchmark. Risk, or volatility as measured by standard
deviation, is plotted along the horizontal axis. Reward, as measured by total return, is plotted along the horizontal axis. A line drawn from T-bills and through the benchmark separates
efficient managers from inefficient managers. Efficient managers will plot above this line and are considered to have risk/reward tradeoffs that are superior to the benchmark.
Sharpe Ratio - Reward per unit of risk, calculated using standard deviation and excess return. The greater the Sharpe Ratio, the better.
Standard Deviation - A gauge of risk that measures the spread of the difference of returns from their average. The more a portfolio's returns vary from its average, the higher the
standard deviation.
Style Map - Using returns-based style analysis, the style map is an efficient tool to gauge the adherence of a portfolio to its style mandate. The trend of the style plots allows the
viewer
to identify style drift, or lack thereof. The smaller sized plots represent earlier time periods, while the larger plots represent the more recent observations.
Tracking Error - The standard deviation of the portfolio's residual (i.e. excess) returns. The lower the tracking error,the closer the portfolio returns have been to its risk index.
Aggressively managed portfolios would be expected to have higher tracking errors than portfolios with a more conservative investment style.
Up Market Capture Ratio - A measure of a portfolio's performance in up markets. The higher a portfolio's up market capture ratio, the better the manager capitalized on a rising market.
Ex: a value of 110 suggests the manager captured 110% of the market when the market was up. A negative up market ratio indicates that a manager's returns fell while the market rose.
.
Note: Alternative share classes may be shown to provide the longest track record. Please refer to the manager pages for share class information
REPORT GLOSSARY
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Alpha - Alpha measures the difference between an investment's actual performance, and its expected performance as indicated by its market sensitivity (Beta). A positive Alpha
indicates the risk-adjusted performance is above that index.
Batting Average - This measures the frequency with which a manager performs better than a selected benchmark. It is computed by dividing the number of positive excess returns by
the total number of excess returns during the period.
Beta - Beta is defined as a Manager's sensitivity to market movements and is used to evaluate market related, or systematic risk. Beta is a measure of the linear relationship, over time,
of the Manager's returns and those of the Benchmark. Beta is computed by regressing the Manager's excess returns over the risk free rate (cash proxy) against the excess returns of
the Benchmark over the risk free rate. An investment that is as equally volatile as the market will have a Beta of 1.0; an investment half as volatile as the market will have a Beta of 0.5;
and so on. Thus, Betas higher than 1.0 indicate that the fund is more volatile than the market.
Down Market (Mkt) Capture Ratio - Down Market Capture Ratio is a measure of an investment's performance in down markets relative to the market itself. A down market is one in
which the market's return is less than zero. The lower the investment's Down Market Capture Ratio, the better the investment protected capital during a market decline. A negative
Down Market Capture Ratio indicates that an investment's returns rose while the market declined.
Downside Risk (Semi Standard Deviation, Semi StdDev, or Downside Deviation) - Downside Risk only identifies volatility on the down side. Downside Risk measures the variability of
returns below zero, whereas Standard Deviation attributes volatility in either direction to risk. The Downside Risk method calculates the deviations below zero for each observed
return. Each time a return falls below zero, the sum is divided by the number of observations and the square root is taken. This result is then shown on an annualized basis.
Excess - Denotes that a statistic is being measured relative to the Market Index selected.
R -Squared (R) - This statistic indicates the degree to which the observed values of one variable, such as the returns of a managed portfolio, can be explained by, or are associated with
the values of another variable, such as a Market Index. The Rzvalues generally range from 0.0 to 1.0. An investment with an Rz of 1.0 is perfectly correlated with the market. An Rz of
0.95, for example, implies that 95% of the fluctuations in a portfolio are explained by fluctuations in the market.
Sharpe Ratio - The Sharpe Ratio indicates the excess return per unit of total risk as measured by Standard Deviation. It is a ratio of excess returns over the risk free rate to the Standard
Deviation. The Sharpe Ratio is a measure of the premium earned for the risk incurred by the portfolio.
Standard Deviation (StdDev) - A measure of the extent to which observations in a series vary from the arithmetic mean of the series. The Standard Deviation of a series of asset
returns is a measure of volatility, or risk, of the asset. The more volatile the returns, the higher the standard deviation will be.
Style Map - Plots the historical exposures of a fund's style across appropriate dimensions, such as growth vs. value for equity funds. By viewing this chart, an investor can determine a
manager's style consistency over time. Returns based style analysis is used.
Tracking Error - Tracking Error is a measure of how closely an investment's returns track the returns of the selected Market Index. It is the annualized Standard Deviation of the
differences between the investment's and the associated index's returns. If an investment tracks its associated index closely, then Tracking Error will be low. If an investment tracks its
associated index perfectly, then Tracking Error will be zero.
Up Market (Mkt) Capture Ratio - Up Market Capture Ratio is a measure of a product's performance in up markets relative to the market itself. An up market is one in which the
market's return is greater than or equal to zero. The higher the investment's Up Market Capture Ratio, the better the investment capitalized on a rising market.
Data as of December 31, 2015 unless of erwi a noted. 126