Large-Cap Growth Composite
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Large Cap Growth Composite
Leeb Capital Management
Employs a disciplined investment process which seeks to produce superior returns over a complete market cycle. Provides service tailored to the individual client needs. Offers regular communication from our investment and client service professionals regarding our current market outlook and individual portfolio holdings.
Portfolio Characteristics as of 3/31/09
Portfolio Characteristics17
Forward P/E Ratio Projected Growth Rate PEG Wtd Average Market Cap
LCM
14.0 11% 1.3 $47.0 bil
S&P 500
13.6 6% 2.3 $68.3 bil
Top Ten Portfolio Holdings16
Investment Philosophy and Approach
LCM’s approach seeks to identify: Sectors whose revenues are growing faster than the economy Companies in these sectors with consistent earnings growth Quality stocks with: Dominant industry position Growth rate greater than the average in the sector Superior operating record Reasonable price: defined as having a PEG ratio less than that of the market
iShares Barclays TIPs Bond FPL Group SPDR Gold Tr. Coca Cola CVS Caremark Teva Pharmaceutical Procter & Gamble ConocoPhillips Wal-Mart Roche Holdings
Since Inception (3/31/99) - 3/31/09
$2,300 2,100 1,900 1,700 1,500 1,300 1,100 900 700 500
3/99 3/00 3/01 3/02 3/03 3/04 3/05 3/06 3/07
6.0% 5.6% 3.7% 3.6% 3.6% 3.6% 3.2% 3.2% 3.0% 2.8%
Leeb LCG Composite, Gross Leeb LCG Composite, Net S&P 500 Russell 1000 Growth
+32.1%
Investment Process
LCM believes that superior long-term results are best achieved by selecting stocks that, through a combination of growth potential and balance sheet strength, have an investment value that is not reflected in current prices.
+13.7%
-26.3%
-44.8%
3/08 3/09
Macro-Economic Sector Analysis
Investment Universe 300-500 Stocks Watch List 150 Stocks
Annualized Returns as of 3/31/09
1 year 3 years -7.8% -9.2% -13.1% -11.3% 5 years -0.1% -1.6% -4.8% -4.3% 10 years 2.8% 1.3% -3.0% -6.2% Since Inception 2.8% 1.3% -3.0% -6.2%
Screening Process
Leeb LCG Composite, Gross Leeb LCG Composite, Net S&P 500 Index Russell 1000 Growth
-36.4% -37.4% -38.1% -34.3%
Fundamental Research
Portfolio 30 - 40 Stocks
Portfolio Construction
Fundamental Research
LCM’s fundamental research process seeks to identify companies with the following characteristics: Business Analysis
Dominant market position Companies largely immune to competitive threats Barriers to entry
LCM’s investment process employs a top-down analysis to identify macroeconomic mega-trends that represent growth opportunities in the global economy and determines the current core sectors. This process defines the firm’s stock universe, which is then screened by: Market Capitalization > $5 billion Projected Growth Rate > Market Forward PEG < Market
BLCG309
Growth Factors
Growth expectations for sector Growth expectations versus peers Reasonable PEG ratio
Company Analysis
Overall financial strength Above average earnings growth estimates Profitability Sales growth by market segments
Management Strength
Strategic vision Stability Reputation Experience Track record
Leeb Capital Management (LCM) Performance Results: Large Cap Growth Composite April 1, 1999 through March 31, 2009
Russell 1000 Growth S&P 500 Index Number of Accounts Composite Assets (US$ mil) % of Composite Assets with Bundled Fee7 Total LCG Assets in (US$ mil) % of LCG Assets in Composite Composite Assets as % of Firm assets Total Firm Assets (US$ mil)
Year
Total Return (Gross)
Total Return (Net of Fees)
Composite Dispersion
199912 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 12
24.5% 15.6% -8.2% -27.3% 34.4% 12.9% 13.5% 8.0% 23.3% -34.1% -8.9%
23.2% 14.0% -9.6% -28.4% 32.6% 11.3% 11.8% 6.4% 21.5% -35.2% -9.3%
15.3% -9.1% -11.9% -22.1% 28.7% 10.9% 4.9% 15.8% 5.5% -37.0% -11.0%
25.2% -22.4% -20.4% -27.9% 29.7% 6.3% 5.3% 9.1% 11.8% -38.4% -4.1%
19 27 45 25 27 57 81 93 91 77 63
4.7% 4.3% 3.1% 4.0% 2.0% 1.8% 1.3% 1.7% 0.9% -
$14.1 $20.3 $28.2 $15.7 $20.8 $56.1 $75.3 $83.4 $82.0 $56.3 $46.3
14% 17% 7% 7% 6% -
$55.1 $73.1 $74.4 $52.0 $65.7 $79.0 $107.1 $96.7 $99.8 $72.7 $62.4
25.6% 27.8% 37.9% 30.2% 31.7% 71.0% 70.3% 86.2% 82.2% 77.5% 74.1%
21.0% 23.1% 29.7% 23.4% 24.8% 51.4% 50.8% 56.3% 52.2% 51.0% 47.7%
$67.0 $87.8 $95.1 $67.1 $83.8 $109.1 $148.2 $148.0 $157.1 $110.4 $97.1
Leeb Capital Management (“LCM”) has prepared and presented this report in compliance with the Global Investment Performance Standards (GIPS®) Notes:
1.) Leeb Capital Management ("LCM") is a registered investment advisor with the Securities Exchange Commission. Prior to 2001, the firm was doing business as Money Growth Institute. Leeb Capital Management provides equity money management to retail and institutional investors. LCM’s Large Cap Growth Composite (“Composite”) represents fee-paying accounts with assets greater than $250,000 that are managed in accordance with LCM's Large Cap Growth ("LCG") investment strategy. This strategy invests in equities that are managed with a view towards capital appreciation. The two major tenets of LCM’s Growth investment strategy include the selection of stocks within sectors whose projected growth is higher relative to that of the market, and those stocks which are more cheaply valued than the market on a PEG basis. 2.) The Composite was created as of March 31, 1999 which coincides with the inception of this strategy. A complete list and description of LCM’s composites is available upon request. For the periods from April 1, 1999 through September 30, 2007, LCM has been verified by Ashland Partners and Company LLP. For the periods from October 1, 2007 through March 31, 2009, LCM has been verified by Beacon Verification Services. A copy of the verification report is available upon request. Additional information regarding the firm's policies and procedures for calculating and reporting performance results is also available upon request. 3.) The composite returns are compared to the S&P 500 and the Russell 1000 Growth Indices, the volatility and holdings of which may be materially different from that of the composite. The S&P 500 Index is widely regarded as the best single gauge of the U.S. equities market; this index includes a representative sample of 500 leading companies in leading industries of the U.S economy. The Russell 1000 Growth Index is widely used by institutional investors as a gauge of the U.S. large-cap growth equity market. 4.) Valuations are computed and performance is reported in U.S. dollars. 5.) Composite returns are calculated using the aggregate method. This methodology has been applied consistently for all periods. Other methods may produce different results. 6.) Composite returns are presented gross and net of management fees and include the reinvestment of all dividends and income. All returns are gross of withholding taxes. Gross returns will be reduced by investment advisory fees and other expenses that may be incurred in the management of the account. Net of fee performance was calculated using the highest management fee charged to clients in accordance with LCM’s Growth strategy fee schedule which is stated below. LCM’s advisory fee schedule is the following: Retail Growth Accounts: Up to $750,000:1.5% , Over $750,000: 1.0% 7.) Prior to September 30, 2007, some accounts in the composite paid an all-inclusive fee based on a percentage of assets under management. Gross and net performance for these accounts has been reduced by the entire bundled fee. Other than brokerage commissions, this fee includes portfolio monitoring and consulting services (none of which are paid to LCM). Beginning July 1, 2002, in addition to a management fee, some accounts in the composite pay an all-inclusive fee based on a percentage of assets under management. As of September 30, 2007, the composite has been redefined to exclude these bundled fee accounts. 8.) Quarterly and annual rates of return for the portfolio are computed by compounding the monthly rates of return over the applicable number of months. 9.) "Total LCG Assets" refers to all assets in the LCG strategy, including those which fall below the composite inclusion minimum of $250,000. This figure is provided for comparison purposes. 10.) LCM utilizes neither leverage nor derivative investments as a material component of its investment strategies. 11.) Composite dispersion is calculated using the asset-weighted standard deviation of all portfolios that were included in the composite for the entire year. 12.) Performance for periods of less then 12 months is not annualized. Year 1999 results are for the period of April 1, 1999 through December 31, 1999. Year 2009 results are for the period January 1, 2009 through March 31, 2009. 13.) LCM defines a significant cash flow as an external flow of cash or securities (capital additions or withdrawals) that is client initiated. An external flow of at least 10% of the portfolio market value is considered significant. A significant cash flow into or out of an account is considered a temporary loss of discretion and as such, an account would be removed from the composite in the month before the cash flow arises. An account which is removed from the composite due to the occurrence of a significant cash flow is to be included back in the composite once the account returns to fully-invested status. Additional information regarding the treatment of significant cash flows is available upon request. 14.) Actual performance of client accounts may differ substantially 15.) Past performance is not indicative of future results. 16.) The presentation of LCM's Top Ten Portfolio Holdings is based on a model portfolio for informational purposes only and is shown as supplemental information to this full disclosure presentation, and should not be deemed as a recommendation to trade the securities listed. 17.) The presentation of LCM's Portfolio Characteristics is based on a model portfolio for informational purposes only and is shown as supplemental information to this full disclosure presentation. Index returns shown in the performance comparisons where provided by Standard & Poor's, Russell, and Bloomberg. All of this information comes from sources believed by LCM to be reliable. LCM, however, cannot guarantee the accuracy of the comparative returns and therefore shall not be held liable for inaccurate information obtained from data providers.
Leeb LCG Leeb LCG
Leeb LCG
Leeb LCG
*The Plan Sponsor Network (PSN) is a database provided by Informa Investment Solutions that includes over 2,000 investment firms. ** “Valid Count” represents the number of comparable firms in the universe for the specified time period.
Leeb LCG
Leeb LCG
Large Cap Growth Composite
Leeb Capital Management
Employs a disciplined investment process which seeks to produce superior returns over a complete market cycle. Provides service tailored to the individual client needs. Offers regular communication from our investment and client service professionals regarding our current market outlook and individual portfolio holdings.
Portfolio Characteristics as of 3/31/09
Portfolio Characteristics17
Forward P/E Ratio Projected Growth Rate PEG Wtd Average Market Cap
LCM
14.0 11% 1.3 $47.0 bil
S&P 500
13.6 6% 2.3 $68.3 bil
Top Ten Portfolio Holdings16
Investment Philosophy and Approach
LCM’s approach seeks to identify: Sectors whose revenues are growing faster than the economy Companies in these sectors with consistent earnings growth Quality stocks with: Dominant industry position Growth rate greater than the average in the sector Superior operating record Reasonable price: defined as having a PEG ratio less than that of the market
iShares Barclays TIPs Bond FPL Group SPDR Gold Tr. Coca Cola CVS Caremark Teva Pharmaceutical Procter & Gamble ConocoPhillips Wal-Mart Roche Holdings
Since Inception (3/31/99) - 3/31/09
$2,300 2,100 1,900 1,700 1,500 1,300 1,100 900 700 500
3/99 3/00 3/01 3/02 3/03 3/04 3/05 3/06 3/07
6.0% 5.6% 3.7% 3.6% 3.6% 3.6% 3.2% 3.2% 3.0% 2.8%
Leeb LCG Composite, Gross Leeb LCG Composite, Net S&P 500 Russell 1000 Growth
+32.1%
Investment Process
LCM believes that superior long-term results are best achieved by selecting stocks that, through a combination of growth potential and balance sheet strength, have an investment value that is not reflected in current prices.
+13.7%
-26.3%
-44.8%
3/08 3/09
Macro-Economic Sector Analysis
Investment Universe 300-500 Stocks Watch List 150 Stocks
Annualized Returns as of 3/31/09
1 year 3 years -7.8% -9.2% -13.1% -11.3% 5 years -0.1% -1.6% -4.8% -4.3% 10 years 2.8% 1.3% -3.0% -6.2% Since Inception 2.8% 1.3% -3.0% -6.2%
Screening Process
Leeb LCG Composite, Gross Leeb LCG Composite, Net S&P 500 Index Russell 1000 Growth
-36.4% -37.4% -38.1% -34.3%
Fundamental Research
Portfolio 30 - 40 Stocks
Portfolio Construction
Fundamental Research
LCM’s fundamental research process seeks to identify companies with the following characteristics: Business Analysis
Dominant market position Companies largely immune to competitive threats Barriers to entry
LCM’s investment process employs a top-down analysis to identify macroeconomic mega-trends that represent growth opportunities in the global economy and determines the current core sectors. This process defines the firm’s stock universe, which is then screened by: Market Capitalization > $5 billion Projected Growth Rate > Market Forward PEG < Market
BLCG309
Growth Factors
Growth expectations for sector Growth expectations versus peers Reasonable PEG ratio
Company Analysis
Overall financial strength Above average earnings growth estimates Profitability Sales growth by market segments
Management Strength
Strategic vision Stability Reputation Experience Track record
Leeb Capital Management (LCM) Performance Results: Large Cap Growth Composite April 1, 1999 through March 31, 2009
Russell 1000 Growth S&P 500 Index Number of Accounts Composite Assets (US$ mil) % of Composite Assets with Bundled Fee7 Total LCG Assets in (US$ mil) % of LCG Assets in Composite Composite Assets as % of Firm assets Total Firm Assets (US$ mil)
Year
Total Return (Gross)
Total Return (Net of Fees)
Composite Dispersion
199912 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 12
24.5% 15.6% -8.2% -27.3% 34.4% 12.9% 13.5% 8.0% 23.3% -34.1% -8.9%
23.2% 14.0% -9.6% -28.4% 32.6% 11.3% 11.8% 6.4% 21.5% -35.2% -9.3%
15.3% -9.1% -11.9% -22.1% 28.7% 10.9% 4.9% 15.8% 5.5% -37.0% -11.0%
25.2% -22.4% -20.4% -27.9% 29.7% 6.3% 5.3% 9.1% 11.8% -38.4% -4.1%
19 27 45 25 27 57 81 93 91 77 63
4.7% 4.3% 3.1% 4.0% 2.0% 1.8% 1.3% 1.7% 0.9% -
$14.1 $20.3 $28.2 $15.7 $20.8 $56.1 $75.3 $83.4 $82.0 $56.3 $46.3
14% 17% 7% 7% 6% -
$55.1 $73.1 $74.4 $52.0 $65.7 $79.0 $107.1 $96.7 $99.8 $72.7 $62.4
25.6% 27.8% 37.9% 30.2% 31.7% 71.0% 70.3% 86.2% 82.2% 77.5% 74.1%
21.0% 23.1% 29.7% 23.4% 24.8% 51.4% 50.8% 56.3% 52.2% 51.0% 47.7%
$67.0 $87.8 $95.1 $67.1 $83.8 $109.1 $148.2 $148.0 $157.1 $110.4 $97.1
Leeb Capital Management (“LCM”) has prepared and presented this report in compliance with the Global Investment Performance Standards (GIPS®) Notes:
1.) Leeb Capital Management ("LCM") is a registered investment advisor with the Securities Exchange Commission. Prior to 2001, the firm was doing business as Money Growth Institute. Leeb Capital Management provides equity money management to retail and institutional investors. LCM’s Large Cap Growth Composite (“Composite”) represents fee-paying accounts with assets greater than $250,000 that are managed in accordance with LCM's Large Cap Growth ("LCG") investment strategy. This strategy invests in equities that are managed with a view towards capital appreciation. The two major tenets of LCM’s Growth investment strategy include the selection of stocks within sectors whose projected growth is higher relative to that of the market, and those stocks which are more cheaply valued than the market on a PEG basis. 2.) The Composite was created as of March 31, 1999 which coincides with the inception of this strategy. A complete list and description of LCM’s composites is available upon request. For the periods from April 1, 1999 through September 30, 2007, LCM has been verified by Ashland Partners and Company LLP. For the periods from October 1, 2007 through March 31, 2009, LCM has been verified by Beacon Verification Services. A copy of the verification report is available upon request. Additional information regarding the firm's policies and procedures for calculating and reporting performance results is also available upon request. 3.) The composite returns are compared to the S&P 500 and the Russell 1000 Growth Indices, the volatility and holdings of which may be materially different from that of the composite. The S&P 500 Index is widely regarded as the best single gauge of the U.S. equities market; this index includes a representative sample of 500 leading companies in leading industries of the U.S economy. The Russell 1000 Growth Index is widely used by institutional investors as a gauge of the U.S. large-cap growth equity market. 4.) Valuations are computed and performance is reported in U.S. dollars. 5.) Composite returns are calculated using the aggregate method. This methodology has been applied consistently for all periods. Other methods may produce different results. 6.) Composite returns are presented gross and net of management fees and include the reinvestment of all dividends and income. All returns are gross of withholding taxes. Gross returns will be reduced by investment advisory fees and other expenses that may be incurred in the management of the account. Net of fee performance was calculated using the highest management fee charged to clients in accordance with LCM’s Growth strategy fee schedule which is stated below. LCM’s advisory fee schedule is the following: Retail Growth Accounts: Up to $750,000:1.5% , Over $750,000: 1.0% 7.) Prior to September 30, 2007, some accounts in the composite paid an all-inclusive fee based on a percentage of assets under management. Gross and net performance for these accounts has been reduced by the entire bundled fee. Other than brokerage commissions, this fee includes portfolio monitoring and consulting services (none of which are paid to LCM). Beginning July 1, 2002, in addition to a management fee, some accounts in the composite pay an all-inclusive fee based on a percentage of assets under management. As of September 30, 2007, the composite has been redefined to exclude these bundled fee accounts. 8.) Quarterly and annual rates of return for the portfolio are computed by compounding the monthly rates of return over the applicable number of months. 9.) "Total LCG Assets" refers to all assets in the LCG strategy, including those which fall below the composite inclusion minimum of $250,000. This figure is provided for comparison purposes. 10.) LCM utilizes neither leverage nor derivative investments as a material component of its investment strategies. 11.) Composite dispersion is calculated using the asset-weighted standard deviation of all portfolios that were included in the composite for the entire year. 12.) Performance for periods of less then 12 months is not annualized. Year 1999 results are for the period of April 1, 1999 through December 31, 1999. Year 2009 results are for the period January 1, 2009 through March 31, 2009. 13.) LCM defines a significant cash flow as an external flow of cash or securities (capital additions or withdrawals) that is client initiated. An external flow of at least 10% of the portfolio market value is considered significant. A significant cash flow into or out of an account is considered a temporary loss of discretion and as such, an account would be removed from the composite in the month before the cash flow arises. An account which is removed from the composite due to the occurrence of a significant cash flow is to be included back in the composite once the account returns to fully-invested status. Additional information regarding the treatment of significant cash flows is available upon request. 14.) Actual performance of client accounts may differ substantially 15.) Past performance is not indicative of future results. 16.) The presentation of LCM's Top Ten Portfolio Holdings is based on a model portfolio for informational purposes only and is shown as supplemental information to this full disclosure presentation, and should not be deemed as a recommendation to trade the securities listed. 17.) The presentation of LCM's Portfolio Characteristics is based on a model portfolio for informational purposes only and is shown as supplemental information to this full disclosure presentation. Index returns shown in the performance comparisons where provided by Standard & Poor's, Russell, and Bloomberg. All of this information comes from sources believed by LCM to be reliable. LCM, however, cannot guarantee the accuracy of the comparative returns and therefore shall not be held liable for inaccurate information obtained from data providers.
Leeb LCG Leeb LCG
Leeb LCG
Leeb LCG
*The Plan Sponsor Network (PSN) is a database provided by Informa Investment Solutions that includes over 2,000 investment firms. ** “Valid Count” represents the number of comparable firms in the universe for the specified time period.
Leeb LCG
Leeb LCG