EFTA01459674.pdf

8 EM Equities Will the EM Giants Awaken? Disappearing Growth Premium Earnings Growth Premium Gone 500 7.0% r 16° Peak EM Earnings 6.0% -1 140 5.0% -, 400 120 4.0% — — ----- f 100 300 Peak U.S. 3.0% • 80 Earnings 2.0% 1il t 200 0 1 r% 111110 IIIIII ‘,40 -1.0% • pa 100 -2.0% 0 -3.0% 4003 1005 2006 3007 4008 1010 2011 3012 4013 1Q15 -100 Average EM Growth Premium (LHS) -200 ---- (AVG) Average EM Growth Premium (LHS) '96 '97 '98 '99 DO '01 '02 '03 D4 '05 '06 '07 D8 '09 '10 '1 '12 '13 '14 '15 MSCI EM (local) - S&P 500 Index (RHS) - (INDEX) S&P 500 EPS (LTM) ua MSCI EM USD PM. • S&P 500 Price) — (INDEX) MSCI EM EPS (LTM) Emerging market equities have benefitted from Emerging markets experienced several years superior economic growth over the developed of an earnings growth premium over the U.S. markets in recent years. However, the collapse in commodity prices However, that growth premium has been and lackluster economic growth in EM has eliminated and has resulted in emerging market resulted in the earnings growth premium equities lagging developed market equities. collapsing. As a result, the U.S. has been outperforming the emerging markets. Footnotes: Data as of 3O15. Foolnotes: Data as of Deconber 31. 2015 Booms: Bloomberg Finance LP, FabtSet, Detilsche Rank Wealth Managernerd Sourte FactSet, Clealsche Sank Wealth Management Deutsche Bank Wealth Mana0ement 22 CONFIDENTIAL — PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0 120283 CONFIDENTIAL SDNY_GM_00266467 EFTA01459674