prospect presentation
TRANSCRIPT
True Fiduciary Guidance
Michael J. Chasnoff, CFP®
Principal and CEO
Steven T. Condon, CFA
Managing Principal
03.31.12
4901 Hunt Road | Suite 200 | Cincinnati, OH | 45242 | 513.792.6648 PH | 513.792.6644 FX | TruepointInc.com
1
"The fiduciary acts at all times for the sole benefit and interests of another, with loyalty
to those interests. A fiduciary must not put personal interests before that duty, and must not
be in a situation where his fiduciary duty to clients conflicts with a fiduciary duty to any
other entity."
- John Bogle, founder and former CEO of Vanguard
Fiduciary GuidanceRole of the Advisor
2
What We Do
Partner with our clients to deliver insight, clarity and confidence to the management of their financial lives
How We Do It
Through the integration of highly qualified specialists and proven processes,
we provide superior, proactive wealth advisory services
The Results
585 client surveys have been completed over the past seven years;
over 98% of those clients indicated they would refer others to Truepoint based on their experience
About Truepoint Inc.Who We Are
Date Formed 1990 (one of the area's first fee-only firms)
Ownership 100% employee-owned
Assets Under Management $1.12 billion (as of March 31, 2012)
Client Locales 29 states (35% of clients are outside Ohio); 3 foreign countries
Professional Designations CFA (3), CPA (5), CFP® (10), CTFA (1), MBA (5), CAIA (1)
3
We believe in challenging the industry’s traditional model of wealth management
True advisory firms are in the minority
– Independent, unbiased advice necessitates a fee-only compensation model
– A client-first focus is most effectively achieved in a privately owned firm that is fully controlled
by the same professionals who actively deliver advice to clients
It is the integration of expertise in multiple financial specializations that produces the
most value
A narrow focus only on the investment portfolio sacrifices the significant opportunity to add
value through integrated financial management
The seamless coordination of expertise across areas such as investment management, tax
management, wealth planning and estate & trust services is most powerful
The investment industry often exploits human emotion and lack of consumer awareness
The industry is designed to give advice based on the belief that the very markets they trade in
do not work
The overarching flaw is the concept that someone can predict the future—all traditional Wall
Street-investment advice involves forecasting some future event
About Truepoint Inc.Our Core Beliefs
4
About Truepoint Inc.National Recognition
AdvisorOne– AdvisorOne magazine’s annual Top Wealth Managers listing has acknowledged
Truepoint as one of the nation's top 100 wealth managers since 2001.
Barron’s – Michael J. Chasnoff and Truepoint are named to Barron‟s 2008 and
2011 Top 100 Independent Financial Advisors listing.
Worth – Michael J. Chasnoff and Truepoint have been named to Worth‟s Top Wealth Advisors listing
thirteen times since 1994. Worth discontinued its ranking post its 2008 listing.
Medical Economics – Michael J. Chasnoff and Truepoint have been included on Medical Economics’
biennial Best Advisors for Doctors listing since 2002.
Financial Advisor – Truepoint has been repeatedly recognized in Financial
Advisor magazine’s Top RIA ranking.
Accounting Today – Accounting Today ranks Truepoint 15th in its Top Wealth Magnets listing in 2011.
This is the fourth year in a row that Truepoint has been named to this list.
Cincinnati –Cincinnati magazine named Truepoint advisors among a listing of the best wealth managers
in the city for 2008, 2009, 2010 and 2011, as judged by client satisfaction ratings.
Third-party rankings and recognition from publications are no guarantee of future investment success. Working with a highly rated advisor does not ensure that a client or
prospective client will experience a higher level of performance or results. Generally, ratings, rankings and recognition are based on information prepared and submitted by the
advisor and not all investment advisors participate in the process. A more thorough disclosure of the criteria used in making these rankings is available through each publication.
5
About Truepoint Inc. Service Offerings
A single family office experience that
leverages Truepoint’s advisory platform
Suggested minimum assets of $25,000,000
Fees customized per family goals
Customized wealth management services
integrating multiple disciplines
Suggested minimum assets of $2,000,000
Tiered fee schedule begins at 0.80%
Investment management coupled with
financial advice and guidance
Suggested minimum assets of $500,000
Tiered fee schedule begins at 0.70%
6
Truepoint Financial Truepoint Capital Truepoint Family Office
Retirement income planning Financial statement preparation Generational education and planning
Withdrawal rate analysis Cash flow and budgeting projections Philanthropy and trust administration
Education planning Advanced tax planning and preparation Bill paying and banking
Employee benefit guidance Estate planning and asset ownership review Expense management and reporting
Charitable gift and succession planning Family counseling and governance
Deferred compensation planning External account aggregation
Corporate benefits review and analysis Lifestyle services
Insurance analysis and recommendation Family education
Document and record management Family bank
Strategic stock option management Family business services
College savings strategies
Debt management
About Truepoint Inc.A Wealth of Services
Investment policy statement and portfolio design
Investment manager/vehicle selection
Ongoing contingent portfolio rebalancing
Portfolio performance monitoring and reporting
Investment services are delivered across all service offerings
Additional services are progressive throughout the service offerings
7
Investment strategy should be rooted not in speculation, but rather in the science of
the capital markets
Decades of academic research and empirical data provide clear guidance for most
effectively capturing financial market returns
We focus on factors within the investor’s control
We focus on what works, versus what sells
We don’t speculate. We invest.
Our Investment PhilosophyBetter Investing Through Science
8
Conventional wisdom suggests that smart people, working diligently, can select stocks which are
mispriced by the market. These informed investors are also assumed to be able to time the market.
A study of the returns of 3,156 U.S. stock mutual funds from 1984 to 2006 generated these findings:
− Most funds achieving some of level of market outperformance did so simply by chance
− Only zero to 3% of active managers exhibit the skill sufficient to outperform
− Even if ―skilled‖ managers exist, they are indistinguishable on a forward-looking basis
Given the cost of active management, approximately three-quarters of investment managers have,
and will continue over the long-term, to underperform the overall market.
The Myth of Active ManagementFooled by Randomness
“Most investors, both institutional and individual, will find that the best way to own common stocks is through an index fund that
charges minimal fees. Those following this path are sure to beat the net results (after fees and expenses) delivered by the great majority of investment professionals.”
Warren Buffett
Chairman, Berkshire Hathaway
9
In the face of overwhelming evidence, why do investors keep playing a game they are likely to lose?
It is consistently encouraged by those who stand to profit the most—Wall Street and the
financial media
Investors are overconfident—a natural human condition not limited to investing
Active management is the triumph of hope over experience—but hope does spring eternal
Active investing is more exciting, and provides better cocktail chatter, than passive investing
The Myth of Active ManagementPlaying a Loser’s Game
“What‟s really quite remarkable in the investment world is that people are playing a game which, in some sense, cannot be played.
There are so many people out there in the market; the idea that any single individual without extra information or extra market
power can beat the market is extraordinarily unlikely.
“Yet the market is full of people who think they can do it and full of other people who believe them. This is one of the great mysteries of finance: Why do people believe they can do the impossible? And why do other people believe them?”
Daniel Kahneman
2002 Nobel Laureate (Economics)
10
Markets Work
– Prices reflect all available information and the aggregate opinion of market participants
– Prices move only in response to new information, which may be better or worse than expected
Diversification is Essential
– Diversification reduces uncertainty
– Concentrated investments add risk, with no additional expected return
Risk and Return are Related
– Exposure to meaningful risk factors determines expected return
– Asset allocation along size, value and market dimensions primarily determines the returns of a broadly
diversified portfolio
Control What You Can
– Maintain discipline and have a long-term view of investing
– Consider expenses and tax-efficiency of investment vehicles
Our Investment PhilosophyPrinciples and Beliefs
11
Our Investment ProcessAn Institutional Approach
Identify Risk and Return Objectives
Evaluate time horizon, cashflow expectations
and need, ability and willingness to take risk
Determine the Appropriate Asset Allocation
Efficiently balance market, inflation and longevity risks
Select Optimal Investment Vehicles
Identify most effective strategies in each category
Employ Disciplined Real-Time Portfolio Rebalancing
Manage risk while capitalizing on market volatility
12
The Behavior GapDiscipline is Critical to Success
Total returns are annualized and represent the 20-year period ending 12/31/10. Average Investor return is based on an analysis by Dalbar Inc., which utilizes the net of
aggregate mutual fund sales, redemptions and exchanges each month as a measure of investor behavior.
Investors often impair their returns through emotional reactions (fear or greed) to market performance
A 2009 study concluded that aggressive trading by individuals reduces returns by about 4% per year
“The investor’s chief problem—and even his worst enemy—is likely to be himself.”
Benjamin Graham
Famed investor and mentor of Warren Buffet
10.50%
8.00% 7.70% 7.20%6.10%
4.70%
2.80% 2.60%
-1%
1%
3%
5%
7%
9%
11%
13%
15%
REITS Oil US Stocks Gold Bonds Foreign Stocks
Homes Average Investor
20-Year Annualized Returns
13Source: Investment Company Institute, J.P. Morgan Asset Management. Data are as of 6/30/11.
Emotion over LogicBuying High and Selling Low
On average, investors repeatedly invest in stocks at high points, and sell at low points
“If you can plug your ears to every attempt (by anyone) to predict what the markets will do, you will outperform nearly every other investor alive over the long run. Only the mantra
of „don‟t know and, I don‟t care‟ will get you there.”
Jason Zweig
Personal finance columnist, Wall Street Journal
14
-3.2%-5.7%
-16.0%
-40%
-35%
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
2007 2008 2009 Cumulative
Truepoint 70/30 Morningstar Moderate Allocation S&P 500 Index
Truepoint’s 70/30 Portfolio Composite results reflect the aggregate net-of-fee performance of client portfolios managed to benchmark allocations of
70% stocks/30% bonds and cash. Morningstar Moderate Allocation results reflect the aggregate performance of mutual funds typically holding 50-70%
of assets in stocks and the remainder in bonds and cash. Additional data and important disclosures can be found in the Appendix of this presentation.
Mitigate Downside, Maximize Upside
The Importance of Portfolio ConstructionDramatic Downturn of 2007-2009
15
10.0%
0.4%
-11.7%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
2001 2002 2003 Cumulative
Truepoint 70/30 Morningstar Moderate Allocation S&P 500 Index
Mitigate Downside, Maximize Upside
The Importance of Portfolio ConstructionChallenging Market of 2001-2003
Truepoint’s 70/30 Portfolio Composite results reflect the aggregate net-of-fee performance of client portfolios managed to benchmark allocations of
70% stocks/30% bonds and cash. Morningstar Moderate Allocation results reflect the aggregate performance of mutual funds typically holding 50-70%
of assets in stocks and the remainder in bonds and cash. Additional data and important disclosures can be found in the Appendix of this presentation.
16
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
$1,600,000
$1,800,000
$2,000,000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Portfolio Performance Comparisons
2001 – 2012
$1,803,195
$1,449,361
$1,324,568
Growth of $1,000,000
Truepoint 70/30 Morningstar Moderate Allocation S&P 500 Index
Truepoint’s 70/30 Portfolio Composite results reflect the aggregate net-of-fee performance of client portfolios managed to benchmark allocations of 70% stocks/30% bonds and
cash. Morningstar Moderate Allocation results reflect the aggregate performance of mutual funds typically holding 50-70% of assets in stocks and the remainder in bonds and cash.
Data as of 03/31/12. Additional data and important disclosures can be found in the Appendix of this presentation.
17
100/0 Portfolio 80/20 Portfolio 70/30 Portfolio 60/40 Portfolio 50/50 Portfolio
Approximate Asset Allocation
US Stocks 54.00% 43.20% 37.80% 32.40% 27.00%
Foreign Stocks 36.00% 28.80% 25.20% 21.60% 18.00%
Real Estate 10.00% 8.00% 7.00% 6.00% 5.00%
Bonds 0.00% 18.00% 27.00% 36.00% 45.00%
Cash 0.00% 2.00% 3.00% 4.00% 5.00%
1 Year 8.54% 0.26% 0.70% 1.90% 1.84% 2.42% 2.36% 2.87% 2.85% 3.38% 3.30%
3 Year 23.42% 24.61% 23.32% 21.84% 20.02% 19.90% 18.32% 18.11% 16.60% 16.53% 14.84%
5 Year 2.01% 1.22% 0.57% 2.42% 1.67% 3.12% 2.10% 3.07% 2.29% 3.81% 3.12%
7 Year 4.71% 5.49% 4.82% 5.50% 4.85% 5.72% 4.85% 5.32% 4.76% 5.57% 4.92%
10 Year 4.12% 6.26% 5.33% 6.29% 5.24% 6.17% 5.20% 5.75% 5.14% -- --
Portfolio | BenchmarkPortfolio | Benchmark Portfolio | BenchmarkPortfolio | Benchmark Portfolio | BenchmarkS&P 500
Investment PerformancePerformance by Allocation | As of 03.31.12
Data shown represents annualized net-of-fee performance.
Additional data and important disclosures can be found in the Appendix of this presentation.
19
Client Satisfaction Survey2011 Results
Overall Satisfaction 7-Year
2011 Average
Confidence in Truepoint and overall satisfaction with services 9.38 9.40
Expectations being met or exceeded 99% 97%
Likely to refer Truepoint to others 98% 98%
Advisory Team 2011
Professional Competence 9.61
Responsiveness 9.67
Proactivity 9.37
Personal Relationship 9.56
Satisfied with the frequency of interaction 95%
Resources
Find online access to accounts via TruepointInc.com valuable 66%
Find value in educational content provided 88%
Below is a summary of the results for 2011, along with seven-year averages where available.
Questions are either scored on a 1 to 10 (highest) scale or are simply answered yes or no.
20
Truepoint Financial Truepoint Capital Truepoint Family Office
Client's Portfolio Value AUM AUM AUA AUM/AUA
Up to $5,000,000 0.70% 0.80% 0.25%
Fees are based upon
customized proposalsNext $5,000,000 0.60% 0.50% 0.20%
Above $10,000,000 0.60% 0.30% 0.20%
Suggested Minimum Account Balance $500,000 $2,000,000 $25,000,000
Service OfferingsFee Schedule
In recognition of the client's one-year anniversary, the firm will begin absorbing all advisor-directed portfolio
transaction costs
Portfolio values falling below the suggested minimum account balance are subject to a minimum fee resulting in an
annual rate in excess of those listed above
The weighted average expense of underlying portfolio holdings approximates 0.25% – 0.30%
Assets Under Management (AUM) includes all investment assets under the discretion of Truepoint
Assets Under Advisement (AUA) includes the fully-vested equity value of monitored assets not under Truepoint’s
discretion
Truepoint provides ongoing advisement, continuous monitoring and periodic reporting on all AUM and AUA
21
Truepoint Financial
Truepoint Capital
Fee ComparisonMedian Fees Charged vs. Truepoint
Source: 2007 industry survey, Investment Advisor and Rydex
Truepoint Financial suggested minimum - $500,000
Truepoint Capital suggested minimum - $2,000,000
Truepoint Family Office suggested minimum - $25,000,000
Investment Management
& Financial Guidance
Integrated Wealth
Management
Customized Family
Office Services
.70% .80% .90% 1.00% 1.10%.60%.50%
Truepoint Family Office
Industry Median
22
1.00%
0.05%
0.26%
0.70%
1.08%
0.20%
0.00%
0.25%
0.50%
0.75%
1.00%
1.25%
1.50%
1.75%
2.00%
2.25%
2.50%
2.75%
Truepoint Inc. Industry Average
Financial Advisory Services Fund Expense Ratio Trading Expenses
Portfolio ManagementThe Truth About Fees
Trading Expenses – industry average taken from GIPS Guidance Statement on Fees (1/1/11)
Truepoint absorbs all trading expenses after a client’s one-year anniversary
23
P&G Pre-Retirement Service
Our Procter & Gamble Pre-Retirement Service has been created specifically for current employees of P&G who are
within five years of retirement or separation. This service offering is tailored to the distribution and management
needs of the P&G Profit Sharing Trust and Savings Plan.
Non-Profit Portfolio Services
Truepoint designs and manages portfolios congruent with the term and goals of foundations, endowments and
other nonprofit organizations. Our institutional investment philosophy works well with tax-exempt organizations by
decreasing their investment costs thus allowing more assets to support the organization's mission. For entities
employing multiple investment advisors, Truepoint assists with the critically important monitoring, evaluation and
coordination of the total portfolio inclusive of all assets and advisors.
Business Services
For institutional clients, Truepoint provides Retirement Plan Management services. We provide guidance for
both profit sharing and defined benefit plans, working closely with trustees to develop the most appropriate plan.
Additionally, to meet the unique needs of our clients with closely held business interests, we provide Net Worth
Consulting, advising on a total asset allocation which incorporates private business interest, real property holdings
and other non-traditional assets in addition to the liquid investment portfolio.
Specialized ServicesCorporate Executives and Institutions
24
Clients of Truepoint have access to our private trust company, National Advisors Trust Company
(NATC), which can provide low-cost fiduciary trust services across current and future generations.
NATC, a federally chartered trust company, was created in 2001 by more than 120
independent, nationally-recognized financial advisors, to better integrate their distinctive understanding of
their clients' personal and financial circumstances with the fiduciary responsibilities of a corporate trustee.
Independent trust administration
$4.6 billion under management
Federal Deposit Insurance Corporation (FDIC) insured
Office of Thrift Supervision (OTS) regulated
Though NATC acts as trustee, Truepoint serves as our clients' primary advisor, ensuring seamless
consistency of trust services and carefully planned long-term family financial objectives.
Private Trust ServicesNational Advisors Trust Company
27
Segmented Account StructureSample Portfolio
Operating Account Reserve Account Capital Account
Income
Distributions
Annualized distributions equal to 3.0% to replenish Operating Account
Account Characteristics
High Quality Short to
Intermediate-Term Laddered
Bond Portfolio
Truepoint PortfolioInterest Bearing Checking
Account
Account
Strategy
Portfolio
28
Client references
Biographies of advisory team
Form ADV, parts I and II
Client agreement
Client questionnaire
Sample investment policy statement, financial plan and aggregate portfolio review
Additional DetailAvailable Upon Request
29
Performance Disclosure100/0 Portfolio Composite
Composite Benchmark Composite Composite Number of Total Firm
Return Return Return Assets Portfolios Assets
Year Net of Fees Dispersion (millions) (millions)
2011 -5.83% -6.11% 0.33% 12 88 1,011
2010 18.74% 16.65% 0.75% 13 80 923
2009 34.60% 33.55% 0.91% 7 58 749
2008 -40.15% -40.15% 0.62% 5 19 558
2007 7.27% 6.63% 0.27% 8 10 750
2006 19.52% 18.58% 0.11% 3 7 667
2005 11.23% 9.48% 0.99% 1 5 or fewer 456
2004 16.27% 15.11% 0.21% 1 5 or fewer 373
2003 35.37% 33.07% 0.76% 1 5 or fewer 274
2002 -15.78% -17.67% 0.87% 1 5 or fewer 190
2001 -8.99% -9.75% 0.18% 1 5 or fewer 143
The 100/0 Portfolio Composite contains fully discretionary portfolios seeking extremely aggressive long-term growth while tolerating extreme fluctuations in market value, especially over the short-term.
Approximate neutral allocation of portfolios is 100% equity. Effective December 31, 2008, the minimum account size for this composite is $10,000. As of December 31, 2011, the three-year annualized
standard deviation for the 100/0 Portfolio Composite was 21.79%. The three-year annualized standard deviation for the 100/0 Benchmark was 21.01% through December 31, 2011.
For comparison purposes the composite is measured against the 100/0 Benchmark which consists of the following Morningstar categories: 45.00% Large Blend, 15.00% Small Blend, 18.00% Foreign Large
Blend, 6.00% Foreign Small/Mid Value, 6.00% Diversified Emerging Markets, 5.00% Global Real Estate, 5.00% Real Estate. The benchmark weighting is static. As of January 1, 2006, the benchmark return
is calculated annually, prior the benchmark return was calculated quarterly. As of January 1, 2009, the benchmark was revised with an increase in the foreign allocation to reflect the growth in foreign capital
markets (on April 1, 2009, the real estate segment was revised to include both Global Real Estate and Real Estate retroactive to January 1, 2009).
Truepoint is an independent, fee-only wealth management firm. Prior to December 31, 2003, the firm was known as Advanced Capital Strategies, Inc. The firm maintains a complete list and description of
composites, which is available upon request.
As of 12/31/2010, the composite contains 100% bundled fee accounts, prior to 2010 the composite did not contain any bundled fee accounts. Net Returns are presented net of the highest fee schedule and
include the reinvestment of all income.. Other than brokerage commissions this fee includes investment management and in some cases custodial services.
Results are based on fully discretionary accounts under management, including those accounts no longer with the firm. Past performance is not indicative of future results.
The U.S. Dollar is the currency used to express performance. Effective January 1, 2010, returns are presented net of a bundled fee composed of management and trading fees and include the reinvestment of
all income. Prior to this date, net of fee performance was calculated using the highest applicable annual investment management fee of 0.50% applied quarterly. Annual fees, including those as part of the
bundled fee arrangement, for investment advisory services are applied to portfolio values on a graduated basis as follows: amounts less than $5,000,000 = 0.50%; $5,000,001 to $10,000,000 = 0.40%;
$10,000,001 to $20,000,000 = 0.30%; amounts in excess of $20,000,000 = 0.25%. Different fee schedules apply for more comprehensive service offerings. The annual composite dispersion presented is an
asset-weighted standard deviation calculated for the accounts in the composite the entire year. Policies for valuing portfolios, calculating performance, and preparing compliant presentations are available
upon request.
The 100/0 Portfolio Composite was created January 1, 2001. Truepoint Inc. claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in
compliance with GIPS standards. Truepoint has been independently verified for the period January 1, 2001, through December 31, 2011. Verification assesses whether (1) the firm has complied with all the
composite construction requirements of the GIPS standards on a firm-wide basis (2) the firm's policies and procedures are designed to calculate and present performance in compliance with GIPS standards.
The 100/0 Portfolio Composite has been examined for the period January 1, 2001, through December 31, 2011. The verification and performance examination reports are available upon request.
30
Performance Disclosure80/20 Portfolio Composite
Composite Benchmark Composite Composite Number of Total Firm
Return Return Return Assets Portfolios Assets
Year Net of Fees Dispersion (millions) (millions)
2011 -3.54% -3.98% .48% 83 70 1,011
2010 16.51% 14.04% 0.46% 84 65 923
2009 30.89% 28.63% 1.51% 70 58 749
2008 -33.50% -32.59% 0.88% 51 60 558
2007 6.39% 5.30% 0.50% 90 67 750
2006 16.04% 15.29% 0.61% 77 61 667
2005 7.77% 7.34% 0.40% 62 53 456
2004 13.56% 12.44% 0.84% 47 41 373
2003 32.21% 26.71% 1.06% 39 38 274
2002 -12.46% -13.00% 1.10% 27 36 190
2001 -4.81% -5.98% 1.85% 19 29 143
The 80/20 Portfolio Composite contains fully discretionary portfolios seeking aggressive long-term growth while tolerating wide fluctuations in market value, especially over the short-term. Approximate
neutral allocation of portfolios is 80% equity, 20% fixed income and cash. The minimum account size for this composite is $250,000. As of December 31, 2011, the annualized standard deviation for the
80/20 Portfolio Composite was 17.92%. The three-year annualized standard deviation for the 80/20 Benchmark was 16.89% through December 31, 2011.
For comparison purposes the composite is measured against the 80/20 Benchmark which consists of the following Morningstar categories: 36.00% Large Blend, 12.00% Small Blend, 14.40% Foreign Large
Blend, 4.80% Foreign Small/Mid Value, 4.80% Diversified Emerging Markets, 4.00% Global Real Estate, 4.00% Real Estate, 5.00% Intermediate-Term Bond, 5.00% Muni National Interm, 4.00% Short Term
Bond, 4.00% Muni National Short, 1.00% Money Market-Taxable, 1.00% Money Market-Muni. The benchmark weighting is static. As of January 1, 2006, the benchmark return is calculated annually prior the
benchmark return was calculated quarterly. As of January 1, 2009, the benchmark was revised to include tax-exempt fixed income and the foreign allocation was increased to reflect the growth in foreign
capital markets (on April 1, 2009, the real estate segment was revised to include both Global Real Estate and Real Estate retroactive to January 1, 2009).
As of 12/31/2010, the composite contains 100% bundled fee accounts, prior to 2010 the composite did not contain any bundled fee accounts. Net Returns are presented net of the highest fee schedule and
include the reinvestment of all income.. Other than brokerage commissions this fee includes investment management and in some cases custodial services.
Truepoint is an independent, fee-only wealth management firm. Prior to December 31, 2003, the firm was known as Advanced Capital Strategies, Inc. The firm maintains a complete list and description of
composites, which is available upon request.
Results are based on fully discretionary accounts under management, including those accounts no longer with the firm. Past performance is not indicative of future results.
The U.S. Dollar is the currency used to express performance. Effective January 1, 2010, returns are presented net of a bundled fee composed of management and trading fees and include the reinvestment of
all income. Prior to this date, net of fee performance was calculated using the highest applicable annual investment management fee of 0.50% applied quarterly. Annual fees, including those as part of the
bundled fee arrangement, for investment advisory services are applied to portfolio values on a graduated basis as follows: amounts less than $5,000,000 = 0.50%; $5,000,001 to $10,000,000 = 0.40%;
$10,000,001 to $20,000,000 = 0.30%; amounts in excess of $20,000,000 = 0.25%. Different fee schedules apply for more comprehensive service offerings. The annual composite dispersion presented is an
asset-weighted standard deviation calculated for the accounts in the composite the entire year. Policies for valuing portfolios, calculating performance, and preparing compliant presentations are available upon
request.
The 80/20 Portfolio Composite was created January 1, 2001. Truepoint Inc. claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in
compliance with GIPS standards. Truepoint has been independently verified for the period January 1, 2001, through December 31, 2011. Verification assesses whether (1) the firm has complied with all the
composite construction requirements of the GIPS standards on a firm-wide basis (2) the firm's policies and procedures are designed to calculate and present performance in compliance with GIPS standards.
The 80/20 Portfolio Composite has been examined for the period January 1, 2001, through December 31, 2011. The verification and performance examination reports are available upon request.
31
Performance Disclosure70/30 Portfolio Composite
Composite Benchmark Composite Composite Number of Total Firm
Return Return Return Assets Portfolios Assets
Year Net of Fees Dispersion (millions) (millions)
2011 -2.49% -2.91% 0.41% 332 189 1,011
2010 15.08% 12.74% 0.56% 310 176 923
2009 28.44% 26.16% 1.38% 249 168 749
2008 -29.15% -29.04% 1.29% 218 178 558
2007 6.53% 5.06% 0.66% 363 178 750
2006 14.58% 13.95% 0.52% 311 155 667
2005 7.19% 6.60% 0.46% 253 139 456
2004 12.23% 11.24% 0.80% 184 114 373
2003 27.46% 23.67% 1.45% 127 81 274
2002 -11.01% -10.53% 1.02% 74 61 190
2001 -3.00% -4.42% 1.77% 57 39 143
The 70/30 Portfolio Composite contains fully discretionary portfolios seeking long-term growth while tolerating significant fluctuations in market value, especially over the short-term. Approximate neutral
allocation of portfolios is 70% equity, 30% fixed income and cash. The minimum account size for this composite is $250,000. As of December 31, 2011, the three-year annualized standard deviation for the
70/30 Portfolio Composite was 15.56%. The three-year annualized standard deviation for the 70/30 benchmark was 14.84% through December 31, 2011.
For comparison purposes the composite is measured against the 70/30 Benchmark which consists of the following Morningstar categories: 31.50% Large Blend, 10.50% Small Blend, 12.60% Foreign Large
Blend, 4.20% Foreign Small/Mid Value, 4.20% Diversified Emerging Markets, 3.50% Global Real Estate, 3.50% Real Estate, 7.50% Intermediate-Term Bond, 7.50% Muni National Interm, 6.00% Short Term
Bond, 6.00% Muni National Short, 1.50% Money Market-Taxable, 1.50% Money Market-Muni. The benchmark weighting is static. As of January 1, 2006, the benchmark return is calculated annually prior the
benchmark return was calculated quarterly. As of January 1, 2009, the benchmark was revised to include tax-exempt fixed income and the foreign allocation was increased to reflect the growth in foreign
capital markets (on April 1, 2009, the real estate segment was revised to include both Global Real Esate and Real Estate retroactive to January 1, 2009).
Truepoint is an independent, fee-only wealth management firm. Prior to December 31, 2003, the firm was known as Advanced Capital Strategies, Inc. The firm maintains a complete list and description of
composites, which is available upon request.
As of 12/31/2010, the composite contains 100% bundled fee accounts, prior to 2010 the composite did not contain any bundled fee accounts. Net Returns are presented net of the highest fee schedule and
include the reinvestment of all income. Other than brokerage commissions this fee includes investment management and in some cases custodial services.
Results are based on fully discretionary accounts under management, including those accounts no longer with the firm. Past performance is not indicative of future results.
The U.S. Dollar is the currency used to express performance. Effective January 1, 2010, returns are presented net of a bundled fee composed of management and trading fees and include the reinvestment of
all income. Prior to this date, net of fee performance was calculated using the highest applicable annual investment management fee of 0.50% applied quarterly. Annual fees, including those as part of the
bundled fee arrangement, for investment advisory services are applied to portfolio values on a graduated basis as follows: amounts less than $5,000,000 = 0.50%; $5,000,001 to $10,000,000 = 0.40%;
$10,000,001 to $20,000,000 = 0.30%; amounts in excess of $20,000,000 = 0.25%. Different fee schedules apply for more comprehensive service offerings. The annual composite dispersion presented is an
asset-weighted standard deviation calculated for the accounts in the composite the entire year. Policies for valuing portfolios, calculating performance, and preparing compliant presentations are available upon
request.
The 70/30 Portfolio Composite was created January 1, 2001. Truepoint Inc. claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in
compliance with GIPS standards. Truepoint has been independently verified for the period January 1, 2001, through December 31, 2011. Verification assesses whether (1) the firm has complied with all the
composite construction requirements of the GIPS standards on a firm-wide basis (2) the firm's policies and procedures are designed to calculate and present performance in compliance with GIPS standards.
The 70/30 Portfolio Composite has been examined for the period January 1, 2001, through December 31, 2011. The verification and performance examination reports are available upon request.
32
Performance Disclosure60/40 Portfolio Composite
Composite Benchmark Composite Composite Number of Total Firm
Return Return Return Assets Portfolios Assets
Year Net of Fees Dispersion (millions) (millions)
2011 -1.36% -1.84% 0.44% 138 86 1,011
2010 13.64% 11.43% 0.62% 113 62 923
2009 25.60% 23.70% 1.04% 77 44 749
2008 -26.49% -25.92% 1.51% 62 38 558
2007 6.10% 4.61% 0.79% 91 38 750
2006 13.13% 13.02% 0.40% 82 37 667
2005 6.19% 6.05% 0.41% 42 33 456
2004 11.35% 10.45% 0.45% 25 24 373
2003 23.43% 21.17% 1.64% 18 20 274
2002 -8.53% -8.07% 1.35% 13 15 190
2001 -1.13% -2.71% 1.34% 14 13 143
The 60/40 Composite contains fully discretionary portfolios seeking moderate long-term growth while tolerating material fluctuations in market value, especially over the short-term. Approximate neutral
allocation of portfolios is 60% equity, 40% fixed income and cash. The minimum account size for this composite is $250,000. As of December 31, 2011, the three-year annualized standard deviation of the
60/40 Composite was 13.55%. The three-year annualized standard deviation of the 60/40 benchmark was 12.79% through December 31, 2011.
For comparison purposes the composite is measured against the 60/40 Benchmark which consists of the following Morningstar Categories: 27.00% Large Blend, 9.00% Small Blend, 10.80% Foreign Large
Blend, 3.60% Foreign Small/Mid Value, 3.60% Diversified Emerging Markets, 3.00% Global Real Estate, 3.00% Real Estate, 10.00% Intermediate-Term Bond, 10.00% Muni National Interm, 8.00% Short
Term Bond, 8.00% Muni National Short, 2.00% Money Market-Taxable, 2.00% Money Market-Muni. The benchmark weighting is static. As of January 1, 2006 the benchmark return is calculated annually
prior the benchmark return was calculated quarterly. As of January 1, 2009, the benchmark was revised to include tax-exempt fixed income and the foreign allocation was increased to reflect the growth in
foreign capital markets (on April 1, 2009, the real estate segment was revised to include both Global Real Estate and Real Estate retroactive to January 1, 2009).
Truepoint Inc. (―Truepoint‖) is an independent, fee-only wealth management firm. Prior to December 31, 2003, the firm was known as Advanced Capital Strategies, Inc. The firm maintains a complete list
and description of composites, which is available upon request.
Results are based on fully discretionary accounts under management, including those accounts no longer with the firm. Past performance is not indicative of future results.
As of 12/31/2010, the composite contains 100% bundled fee accounts, prior to 2010 the composite did not contain any bundled fee accounts. Net Returns are presented net of the highest fee schedule and
include the reinvestment of all income. Other than brokerage commissions this fee includes investment management and in some cases custodial services.
The U.S. Dollar is the currency used to express performance. Effective January 1, 2010, returns are presented net of a bundled fee composed of management and trading fees and include the reinvestment of
all income. Prior to this date, net of fee performance was calculated using the highest applicable annual investment management fee of 0.50% applied quarterly. Annual fees, including those as part of the
bundled fee arrangement, for investment advisory services are applied to portfolio values on a graduated basis as follows: amounts less than $5,000,000 = 0.50%; $5,000,001 to $10,000,000 = 0.40%;
$10,000,001 to $20,000,000 = 0.30%; amounts in excess of $20,000,000 = 0.25%. Different fee schedules apply for more comprehensive service offerings. The annual composite dispersion presented is an
asset-weighted standard deviation calculated for the accounts in the composite the entire year. Policies for valuing portfolios, calculating performance, and preparing compliant presentations are available upon
request.
The 60/40 Portfolio Composite was created January 1, 2001. Truepoint Inc. claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in
compliance with GIPS standards. Truepoint has been independently verified for the period January 1, 2001, through December 31, 2011. Verification assesses whether (1) the firm has complied with all the
composite construction requirements of the GIPS standards on a firm-wide basis (2) the firm's policies and procedures are designed to calculate and present performance in compliance with GIPS standards.
The 60/40 Portfolio Composite has been examined for the period January 1, 2001, through December 31, 2011. The verification and performance examination reports are available upon request.
33
Performance Disclosure50/50 Portfolio Composite
Composite Benchmark Composite Composite Number of Total Firm
Return Return Return Assets Portfolios Assets
Year Net of Fees Dispersion (millions) (millions)
2011 -0.23% -0.78% 0.46% 66 23 1,011
2010 12.27% 10.13% 0.40% 57 20 923
2009 23.00% 21.24% 0.00% 37 11 749
2008 -20.59% -19.75% 0.52% 5 5 or fewer 558
2007 5.09% 3.65% 0.96% 24 6 750
2006 12.08% 11.20% 0.50% 15 5 or fewer 667
2005 5.29% 4.95% 0.69% 13 5 or fewer 456
2004 8.51% 9.00% 0.00% 7 5 or fewer 373
2003 20.01% 16.32% 0.00% 5 5 or fewer 274
The 50/50 Portfolio Composite contains fully discretionary portfolios seeking modest long-term growth while tolerating moderate fluctuations in market value, especially over the short-term. Approximate
neutral allocation of portfolios is 50% equity, 50% fixed income and cash. The minimum account size for this composite is $250,000. As of December 31, 2011, the three-year annualized standard deviation
for the 50/50 Portfolio Composite was 11.86%. The 50/50 benchmark had a three-year annualized standard deviation of 10.75% through December 31, 2011.
For comparison purposes the composite is measured against the 50/50 Benchmark which consists of the following Morningstar Categories: 22.50% Large Blend, 7.50% Small Blend, 9.00% Foreign Large
Blend, 3.00% Foreign Small/Mid Value, 3.00% Diversified Emerging Markets, 2.50% Global Real Estate, 2.50% Real Estate, 12.50% Intermediate-Term Bond, 12.50% Muni National Interm, 10.00% Short
Term Bond, 10.00% Muni National Short, 2.50% Money Market-Taxable, 2.50% Money Market-Muni. The benchmark weighting is static. As of January 1, 2006, the benchmark return is calculated annually
prior the benchmark return was calculated quarterly. As of January 1, 2009, the benchmark was revised to include tax-exempt fixed income and the foreign allocation was increased to reflect the growth in
foreign capital markets (on April 1, 2009, the real estate segment was revised to include both Global Real Estate and Real Estate retroactive to January 1, 2009).
Truepoint Inc. (―Truepoint‖) is an independent, fee-only wealth management firm. Prior to December 31, 2003, the firm was known as Advanced Capital Strategies, Inc. The firm maintains a complete list
and description of composites, which is available upon request.
As of 12/31/2010, the composite contains 100% bundled fee accounts, prior to 2010 the composite did not contain any bundled fee accounts. Net Returns are presented net of the highest fee schedule and
include the reinvestment of all income. Other than brokerage commissions this fee includes investment management and in some cases custodial services.
Results are based on fully discretionary accounts under management, including those accounts no longer with the firm. Past performance is not indicative of future results.
The U.S. Dollar is the currency used to express performance. Effective January 1, 2010, returns are presented net of a bundled fee composed of management and trading fees and include the reinvestment of
all income. Prior to this date, net of fee performance was calculated using the highest applicable annual investment management fee of 0.50% applied quarterly. Annual fees, including those as part of the
bundled fee arrangement, for investment advisory services are applied to portfolio values on a graduated basis as follows: amounts less than $5,000,000 = 0.50%; $5,000,001 to $10,000,000 = 0.40%;
$10,000,001 to $20,000,000 = 0.30%; amounts in excess of $20,000,000 = 0.25%. Different fee schedules apply for more comprehensive service offerings. The annual composite dispersion presented is an
asset-weighted standard deviation calculated for the accounts in the composite the entire year. Policies for valuing portfolios, calculating performance, and preparing compliant presentations are available upon
request.
The 50/50 Portfolio Composite was created September 30, 2002. Truepoint Inc. claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report
in compliance with GIPS standards. Truepoint has been independently verified for the period January 1, 2001, through December 31, 2011. Verification assesses whether (1) the firm has complied with all the
composite construction requirements of the GIPS standards on a firm-wide basis (2) the firm's policies and procedures are designed to calculate and present performance in compliance with GIPS standards.
The 50/500 Portfolio Composite has been examined for the period September 30, 2002, through December 31, 2011. The verification and performance examination reports are available upon request.