Multi-Manager International Equity
as of December 31, 2013
Fund Commentary
Non-U.S. equity markets continued their advance with another strong quarter of performance as the MSCI ACWI® ex-USA Index rose 4.77%. Europe led the way with a strong gain of 7.88% as continued economic improvements and a surprise interest rate cut by the European Central Bank boosted investor sentiment and led to further earnings-multiple expansion. Asian markets also showed strength during the fourth quarter, although returns were muted as the Japanese yen and Australian dollar both lost significant ground to the U.S. dollar. Emerging market equities as measured by the MSCI Emerging Markets Index underperformed developed markets, returning 1.83% during the fourth quarter.

The Multi-Manager International Equity Fund finished ahead of the benchmark during the quarter with a return of 5.21% compared with the benchmark return of 4.77%. The Fund's underweight exposure to emerging markets contributed to its outperformance during the period. Stock selection in Canada and the U.K. also was strong. Fund performance in Continental Europe did not keep pace with the broad market move. For 2013, the Fund finished ahead of the benchmark, returning 15.77% compared with the MSCI ACWI® ex-USA Index return of 15.29%.

Sub-adviser results were within expectations during the quarter. The growth portfolio of William Blair was notably strong, benefiting from strong performance among U.K. and emerging market positions. Value sub-adviser NFJ underperformed, mainly due to sub-par returns in the Japanese market.
Investor Profile

If you're a long-term investor looking to diversify your investments by pursuing the growth potential of international stocks, then this Fund may be right for you. It is intended for investors who are aware that foreign markets may involve additional risks, such as social and political instability, reduced market liquidity, and currency volatility.

  • Invest in companies of any size throughout the world, but primarily in developed markets and generally in securities similar to those in the MSCI ACWI® EX-USA Index.
  • Select complementary managers from a broad universe of investment managers.
  • Blend managers into a single fund in an effort to provide an attractive combination of risk and return.
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Not FDIC insured | May lose value | No bank guarantee

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