EFTA01430442.pdf

Deutsche Asset & Wealth Management CIO Strategies Globally diversified multi-asset class portfolios 1Q15 Paul Morris Managing Director Private Banker Paul Bartilucci Managing Director Portfolio Manager Stewart Oldfield Director Private Banker Michael J. Driscoll Director Portfolio Manager For one-on-one presentation to qualified investors only. EFTA01430442 The Multi-Asset Investment Committee (MIC) develops the global house view Multi-Asset Investment Committee — Contributing Groups Germany Americas EMEA ex-Germany Asset Management Global Markets 3 & 12 Month House Views UK Asia Discussion Macroeconomic view Asset class return forecasts House view — Themes — Asset class returns — Global asset allocation Deutsche Asset & Wealth Management 1 Investment themes High conviction ideas EFTA01430443 The Regional Investment Committee (RIC) uses the global house view to develop asset allocations for U.S. clients Multi-Asset Investment Committee House view Global asset allocation Regional Investment Committee (RIC) Asset allocation for U.S. portfolios Selection of third party managers Strategic asset allocation — Long term (10-year outlook) — Sensitive to after-tax returns — Changes infrequently (1 year) Tactical asset allocationl — Shorter term (12-month outlook) — Sensitive to after-tax returns — Changes with outlook for asset classes Allocations along the Efficient Frontier2 Models are tailored to meet investors unique requirements Risk We are not tax advisors, therefore please consult with your tax, legal, accounting and financial consultants before making any investment decisions. (1) Tactical considerations alone drive periodic rebalancing elections by the RIC. Strategic considerations are factored into long-term modeling. (2) The efficient frontier is graphical representation of portfolios giving the highest level of expected return at different levels of risk. Deutsche Asset & Wealth Management 2 Customized Portfolio Return EFTA01430444 Proprietary asset allocation process Forward-looking Quantitative and qualitative Active Allocations to alternative assets Client specific Our process does not rely solely on historical returns. We utilize a forward-looking approach to asset allocation construction. Our approach draws on both our proprietary quantitative process and the experienced judgment of our Chief Investment Officer and Regional Investment Committee. Allocations are modified dynamically in response to changes in our global macroeconomic outlook or opportunities in the marketplace. We invest in alternative assets, which allow us to construct portfolios with the potential for higher returns at lower levels of risk. Asset allocation is based on each investor's unique risk/return objectives. Availability of alternative investments, such as hedge funds, is subject to regulatory requirements, and is available only for "Qualified Purchasers" as defined by the U.S. Investment Company Act of 1940 and "Accredited Investors," as defined in Regulation D of the 1933 Securities Act. Deutsche Asset & Wealth Management 3 EFTA01430445 Proposed allocations for taxable client (where hedge funds are suitable) Strategic and tactical allocations Income Equities U.S. Large Cap U.S. Small Cap EAFE European Japan Pacific ex-Japan Emerging Market Core Emg Mkts Equity Emg Mkts Asia Equity Fixed Income & Cash Municipal Bonds High Yield Bonds Int'l Bonds- Hedged Emerging Market Bonds TIPS Cash Alternatives Hedge Funds Non-directional HF Directional HF Commodities 58.5% 50.5% 2.0% --2.0% 2.0% 2.0% 9.0% 7.0% 5.0% 2.0% 2.0% 100.0% Strategic 32.5% 15.0% 2.0% 11.5% 7.5% 2.5% 1.5% 4.0% Tactical 31.5% 15.0% 1.5% 11.5% EFTA01430446 7.5% 2.5% 1.5% 3.5% 2.0% 1.5% 60.5% 50.5% 3.0% --2.5% 2.0% 2.5% 8.0% 7.0% 5.0% 2.0% 1.0% 100.0% 40.5% 32.0% 2.0% --2.5% 2.0% 2.0% 10.5% 8.5% 4.5% 4.0% 2.0% 100.0% Growth & Income Strategic 49.0% 23.5% 2.5% 17.0% 11.5% 3.0% 2.5% 6.0% Tactical 48.0% 23.5% 2.0% 17.0% 11.5% 3.0% 2.5% 5.5% 3.5% EFTA01430447 2.0% 42.5% 32.0% 3.0% --3.0% 2.0% 2.5% 9.5% 8.5% 4.5% 4.0% 1.0% 100.0% 24.0% 16.0% 2.0% --2.0% 2.0% 2.0% 9.0% 7.0% 3.0% 4.0% 2.0% 100.0% Strategic 67.0% 33.0% 3.5% 22.5% 15.0% 4.5% 3.0% 8.0% Growth Tactical 65.5% 33.0% 3.0% 22.5% 15.0% 4.5% 3.0% 7.0% 4.5% 2.5% 26.5% 16.0% 3.0% --2.5% 2.0% EFTA01430448 3.0% 8.0% 7.0% 3.0% 4.0% 1.0% 100.0% 7.0% --2.5% --2.5% --2.0% 8.5% 6.0% --6.0% 2.5% 100.0% Maximum Growth Strategic 84.5% 42.0% 4.0% 29.0% 20.0% 5.5% 3.5% 9.5% Tactical 82.5% 42.0% 3.0% 29.0% 20.0% 5.5% 3.5% 8.5% 5.5% 3.0% 10.5% --4.0% --3.5% --3.0% 7.0% 6.0% --6.0% 1.0% 100.0% Source: Internal sources. Last asset allocation change was May 19, 2015 and is reviewed monthly. Allocation recommendations are subject to change without notice. The "strategic allocation" EFTA01430449 represents our longer term outlook on portfolio diversification and serves as a frame of reference for our short-term tactical adjustments for U.S. clients. Actual portfolio composition and performance will vary within the strategic range based upon active market judgments, altering the allocation and adjusting within asset classes. Neither this Allocation Table nor any of its contents may be used for any purpose without the consent and knowledge of Deutsche Bank. It may not be reproduced or circulated without our written authority. The asset allocations described herein are formulated by the Regional Investment Committee within Wealth Management (RIC) and may utilize the following asset class components: U.S. large cap equity, U.S. small cap equity, Japan equity, Europe equity, Pacific ex-Japan equity, emerging markets equity, U.S. fixed income, U.S. high-yield bonds, international bonds, emerging market bonds, municipal bonds, Treasury Inflation Protected Securities, hedge funds, Real Estate Investment Trusts, commodities, and cash. The RIC currently recognizes four basic investment strategies: Income, Growth & Income, Growth, and Maximum Growth. The strategy selected is based upon the individual investor's objectives and risk tolerance. Your selected portfolio will determine the specific allocation to the asset classes represented by these vehicles. This document is for information purposes only. Not intended to be an offer or solicitation. The products and services above are not appropriate for everyone. An interested party must make his/her own independent legal, tax, accounting and financial evaluation of their merits and risks. Deutsche Bank does not provide tax, legal, or accounting advice. These products and services are not insured by any governmental entity and are subject to investment risk including possible loss of principal. Availability of these products and services may be limited by applicable law. These products are not FDIC insured and are not obligations of nor guaranteed by Deutsche Bank AG or its affiliates. Opinions expressed herein may differ from those expressed by departments or other divisions or affiliates of Deutsche Bank. "Deutsche Bank" means Deutsche Bank AG and its affiliated companies, as the context requires. Wealth Management refers to Deutsche Bank's wealth management activities for highnet-worth clients around the world. Deutsche Asset & Wealth Management 4 EFTA01430450 Implementation vehicles as of 4/20/15 Asset class Vehicle Equities U.S. Large Cap Equity U.S. Small Cap Equity European Equity European Equity Japanese Equity Pacific ex-Japan Equity WM U.S. Core Equity ClearBridge Small Cap Growth Fund Invesco AIM European Growth Fund Ticker N/A SBPYX AEDYX Deutsche X-trackers MSCI Europe Hedged Equity Fund DBEU Deutsche X-trackers MSCI Japan Hedged Equity Fund DBJP iShares MSCI Pacific ex-Japan Fund EPP Emerging Markets Core Equity Parametric Emerging Market Fund Emerging Markets Asia Equity Invesco Asia Pacific Growth Fund Fixed Income Municipals Bonds High Yield Bonds Treasury Inflation Protected Securities Emerging Market Debt Cash Alternative Investments & cash Hedge Commodities Lighthouse Global Long/Short Fund LP (Directional) N/A Prisma Spectrum Fund LP (Non-directional) Deutsche Enhanced Commodity Strategy N/A SKIRX Sources: Internal sources. (1) Implementation vehicles shown are as of 4/20/15 and are subject to change based on the discretion of the Regional Investment Committee, taking into account criteria discussed herein. The implementation vehicles are representative of the underlying investment vehicles of CIO Strategies, are intended to fulfill the asset allocation and are not being offered for direct purchase. The appropriate implementation vehicle for the cash allocation will be chosen based on the client's tax status. Deutsche Asset & Wealth Management 8 5 EFTA01430451 WM Intermediate Fixed Income BlackRock High Yield Fund BlackRock Inflation Protected Bond Fund MFS Emerging Market Debt Fund Deutsche Cash Management Fund EIEMX ASIYX N/A BHYIX BPRIX MEDIX BCSXX EFTA01430452 CIO Strategies performance A strong track record EFTA01430453 Income Strategy returns Performancel for taxable client ending 3/31/15 CIO Strategies w/ U.S. Core Equity as U.S. Large Cap Vehicle 0 1 2 3 4 5 6 7 8 9 5.84 2.94 2.39 1.35 1Q15 1 Year 3 Year 5 Year % Annualized Performance Gross of Fees CIO Strategies - Income Blended Benchmark 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 4.03% 8.51% 9.66% 1.19% 8.59% 19.02% -16.61% 8.90% 9.12% 6.12% 2.81% 7.68% 8.60% 0.97% 7.83% 17.77% -17.06% 7.25% 8.21% 4.42% (1) Chart reflects model returns, not actual client returns. Past performance is no guarantee of future results. The returns shown in this document do not reflect Deutsche Bank management fees. The strategies above are for taxable clients where hedge funds are suitable. The CIO Strategy model portfolios commenced on 1/1/05. Please note that returns for the CIO strategy reflect the Core Equity composite as the U.S. large cap implementation vehicle. Please refer to the Important Notes on the next page for detailed information regarding performance and to the Additional Information page at the end of this document for descriptions of the blended benchmarks. Detailed information regarding the WM-Americas Core Equity composite can be found in the WM —Americas Core Equity pitchbook which can be provided upon request. Deutsche Asset & Wealth Management 10 7 10 Year 1/1/05-3/31/15 6.21 5.10 6.40 5.42 EFTA01430454 5.76 4.70 5.57 4.50 Blended Benchmark EFTA01430455 Growth & Income Strategy returns Performancel for taxable client ending 3/31/15 CIO Strategies w/ U.S. Core Equity as U.S. Large Cap Vehicle 0 1 2 3 4 5 6 7 8 9 7.90 6.94 6.61 2.95 1.59 1Q15 1 Year 3 Year 5 Year % Annualized Performance Gross of Fees 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 CIO Strategies - Growth and Income 4.37% 12.79% 12.03% -1.03% 11.33% 23.78% -23.04% 10.92% 11.78% 7.03% Blended Benchmark 3.01% 11.60% 10.86% -0.89% 9.84% 21.71% -23.96% 7.97% 11.92% 5.67% (1) Chart reflects model returns, not actual client returns. Past performance is no guarantee of future results. The returns shown in this document do not reflect Deutsche Bank management fees. The strategies above are for taxable clients where hedge funds are suitable. The CIO Strategy model portfolios commenced on 1/1/05. Please note that returns for the CIO strategy reflect the Core Equity composite as the U.S. large cap implementation vehicle. Please refer to the Important Notes on the next page for detailed information regarding performance and to the Additional Information page at the end of this document for descriptions of the blended benchmarks. Detailed information regarding the WM-Americas Core Equity composite can be found in the WM —Americas Core Equity pitchbook which can be provided upon request. Deutsche Asset & Wealth Management 11 8 10 Year 1/1/05-3/31/15 3.36 7.76 6.59 EFTA01430456 6.65 5.36 6.41 5.10 Blended Benchmark EFTA01430457 Growth Strategy returns Performancel for taxable client ending 3/31/15 CIO Strategies w/ U.S. Core Equity as U.S. Large Cap Vehicle 10 12 8.30 0 2 4 6 8 3.51 1.93 1015 1 Year 3 Year 5 Year % Annualized Performance Gross of Fees CIO Strategies - Growth Blended Benchmark 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 4.84% 17.64% 14.43% -2.94% 13.79% 29.09% -30.42% 12.52% 14.39% 7.96% 3.40% 16.25% 13.25% -2.57% 11.89% 25.85% -31.31% 8.02% 15.39% 6.91% (1) Chart reflects model returns, not actual client returns. Past performance is no guarantee of future results. The returns shown in this document do not reflect Deutsche Bank management fees. The strategies above are for taxable clients where hedge funds are suitable. The CIO Strategy model portfolios commenced on 1/1/05. Please note that returns for the CIO strategy reflect the Core Equity composite as the U.S. large cap implementation vehicle. Please refer to the Important Notes on the next page for detailed information regarding performance and to the Additional Information page at the end of this document for descriptions of the blended benchmarks. Detailed information regarding the WM-Americas Core Equity composite can be found in the WM —Americas Core Equity pitchbook which can be provided upon request. Deutsche Asset & Wealth Management 12 9 10 Year 1/1/05-3/31/15 4.15 9.78 8.42 9.27 7.98 7.35 5.88 7.07 EFTA01430458 5.57 Blended Benchmark EFTA01430459 Maximum Growth Strategy returns Performancel for taxable client ending 3/31/15 CIO Strategies w/ U.S. Core Equity as U.S. Large Cap Vehicle 10 12 14 0 2 4 6 8 4.02 2.12 1Q15 1 Year 3 Year 5 Year % Annualized Performance Gross of Fees 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 CIO Strategies - Maximum Growth 5.37% 22.27% 16.16% -4.65% 15.89% 34.76% -35.93% 13.97% 16.66% 8.78% Blended Benchmark 3.16% 20.96% 15.68% -4.79% 13.68% 30.30% -37.77% 8.14% 18.86% 7.94% (1) Chart reflects model returns, not actual client returns. Past performance is no guarantee of future results. The returns shown in this document do not reflect Deutsche Bank management fees. The strategies above are for taxable clients where hedge funds are suitable. The CIO Strategy model portfolios commenced on 1/1/05. Please note that returns for the CIO strategy reflect the Core Equity composite as the U.S. large cap implementation vehicle. Please refer to the Important Notes on the next page for detailed information regarding performance and to the Additional Information page at the end of this document for descriptions of the blended benchmarks. Detailed information regarding the WM-Americas Core Equity composite can be found in the WM —Americas Core Equity pitchbook which can be provided upon request. Deutsche Asset & Wealth Management 13 10 10 Year 1/1/05-3/31/15 11.46 9.74 9.91 10.56 9.03 8.08 6.22 4.14 EFTA01430460 7.75 5.87 Blended Benchmark EFTA01430461 Important notes The asset allocations described herein are formulated by the Regional Investment Committee within Wealth Management (RIC) and may utilize the following asset class components: U.S. large cap equity, U.S. small cap equity, Japan equity, Europe equity, Pacific ex-Japan equity, emerging markets equity, U.S. fixed income, U.S. high-yield bonds, international bonds, emerging market bonds, municipal bonds, Treasury Inflation Protected Securities, hedge funds, Real Estate Investment Trusts, commodities, and cash. RIC currently recognizes four basic investment strategies: Income, Growth & Income, Growth, and Maximum Growth. The strategy selected is based upon the individual investor's objectives and risk tolerance. Your selected portfolio will determine the specific allocation to the asset classes represented by the vehicles described herein. Please note returns for the large cap equity portion are represented by the Quality Growth Composite. Implementation vehicles and asset allocations are determined by the WM Regional Investment Committee (RIC) and are change subject at their discretion. Results presented herein do not represent the results of actual trading using client assets. The returns shown in this document are model returns and do not reflect Deutsche Bank management fees or other expenses that may be incurred in the actual management of an account. If such fees and expenses were deducted, the results would be lower. Please be advised of the limitations inherent in using model results. Accounts managed according to the Model may perform differently over the same time period depending on the size of the account, restrictions, the amount of the transaction and related costs, the inception date of the account and other factors. Actual clients may experience returns that are more or less than those of the Model. These model returns do not reflect the impact that material economic factors may have had on our decision-making. Model returns are not indicative of future results; there is always the potential for loss as well as for profit. These returns should not be considered indicative of the skill of the advisor. The CIO Strategy model portfolios commenced on 1/1/05. The model returns reflected herein were achieved by calculating monthly weighted-average returns using actual tactical allocations and vehicles beginning 1/01/05. The model returns presented are used to portray what the CIO Strategies performance would have been during the period if client assets had been invested in these CIO Strategies securities recommendations. Deutsche Bank will continue to employ tactical strategy allocation and rebalancing techniques and therefore the portfolio allocation will change dynamically as market conditions warrant. Please refer to the CIO Strategies marketing information for a description of the methodology used to select investments. The standard fee schedule generally applied to accounts invested in this strategy is as follows: 1.20% on the first $2 million; 0.85% on the next $3 million; 0.60% on the next $5 million; and 0.45% on the balance. Actual investment advisory fees incurred by clients may vary. Blended benchmarks are comprised of indices representing the broad asset classes utilized by the Regional Investment Committee. Blended benchmark EFTA01430462 returns are calculated and rebalanced monthly. A current list of the allocation weights and components in the blended benchmark can be found below. A complete list of historical allocation weights and components is available upon request. Income Sub-asset Class U.S. Large Cap Equity U.S. Small Cap Equity European Equity Japan Equity Pacific ex-Japan Equity Emerging Market Equity Municipal Bonds U.S. High Yield Bonds International Bonds Treasury Inflation Protected Securities Emerging Market Debt Hedge Funds Commodities Cash Deutsche Asset & Wealth Management Benchmark S&P 500 Index Russell 2000 Index MSCI Europe Index (net of withholding taxes) MSCI Japan Index (net of withholding taxes) MSCI Pacific Free ex-Japan Index (net of withholding taxes) MSCI Emerging Markets Index (net of withholding taxes) Barclays Municipal Short/Intermediate Index Merrill Lynch/BOA High Yield Master II Index Citigroup Unhedged Non-U.S. World Govt. Bond Index Barclays U.S. TIPS Index JPMorgan GBI Emerging Markets Index - Unhedged HFRI Fund of Funds Index DBLCI Diversified Commodities Index iMoneyNet Money Funds (All) Tax-Free Average Allocation 15.0% 2.0% 7.5% 2.5% 1.5% 4.0% 50.5% 2.0% --2.0% 2.0% 7.0% 2.00% EFTA01430463 2.00% Growth & Income Allocation 23.5% 2.5% 11.5% 3.0% 2.5% 6.0% 32.0% 2.0% --2.00% 2.5% 8.5% 2.00% 2.00% Growth Allocation 33.0% 3.5% 15.0% 4.5% 3.0% 8.0% 16.0% 2.0% --2.00% 2.00% 7.0% 2.00% 2.00% Maximum Growth Allocation 42.0% 4.0% 20.0% 5.5% 3.5% 9.5% --2.5% ----2.5% 6.0% 2.50% 2.00% 15 11 EFTA01430464 Investment Management Fee Schedule Fees are based on the assets under management appraised every month Fees. Fees ordinarily are billed monthly in arrears, and are computed at one-twelfth the annual fee rates detailed below: Notes: This fee schedule may be amended from time to time upon prior written notice to the Client. Deutsche Asset & Wealth Management 12 EFTA01430465 Biographies Larry V. Adam Chief Investment Officer, Wealth Management — Americas Larry Adam is a Managing Director and serves the dual role of Chief Investment Officer and Chief Investment Strategist for the Wealth Management division of Deutsche Asset & Wealth Management in the Americas. In his role as CIO, he chairs the Americas Regional Investment Committee, the management team responsible for investment strategy and asset allocation for discretionary portfolios in the Americas, and is a voting member on the Multi-Asset Investment Committee, which formalizes and establishes the global house view. As Chief Investment Strategist, Mr. Adam is responsible for articulating and providing detailed research for the house view in regards to the outlook for the economy and each major asset class. Previously, he was the Head of the Asset Allocation and Quantitative Analysis Group, the group responsible for analyzing and implementing client-specific asset allocation strategies. He is widely published and has been quoted in various mainstream and financial publications, including The Wall Street Journal, Barron's and International Herald Tribune. He also frequently appears on television and has been featured on CNBC and Bloomberg TV. Mr. Adam joined Deutsche Bank Alex. Brown in 1992. Mr. Adam received a B.B.A. and a master's degree in business with a concentration in finance from Loyola University Maryland. He has earned the Chartered Financial Analyst®, the Certified Investment Management Analyst® and the Certified Financial Planner'" designations. He can be reached at or emailed at Deutsche Asset & Wealth Management 13 EFTA01430466 Biographies Owen Fitzpatrick, CFA@ Managing Director, Head of U.S. Equity Owen Fitzpatrick is a Managing Director and Head of U.S. Equity at Deutsche Asset & Wealth Management in New York. He is also a member of the Asset Management CIO Executive Committee. Mr. Fitzpatrick has more than 25 years of experience in trust and investment management. Prior to his current role, he served as Head of the U.S. Large Cap Growth Equity Team and was a member of the Global and U.S. Investment Committees for the Asset Management division. Before joining Deutsche Bank in 1995, Mr. Fitzpatrick managed an equity income fund, trust and advisory relationships for Princeton Bank & Trust Company, where he was also responsible for research coverage of the consumer cyclical sector. He previously served as a Portfolio Manager at Manufacturer's Hanover Trust Company. Mr. Fitzpatrick earned his B.A. and his M.B.A in finance from Fordham University. He has earned the Chartered Financial Analyst® designation and is a member of the Association for Investment Management and Research. He can be reached at or emailed at Deutsche Asset & Wealth Management 14 EFTA01430467 Biographies Gary R. Pollack Managing Director, Head of Private Clients Fixed Income Desk Gary R. Pollack is a Managing Director and Head, Private Clients Fixed Income Desk at Deutsche Asset & Wealth Management. He is the Chairman of the U.S. Fixed Income Strategy Group and also the Portfolio Manager of the Tax-Exempt Common Trust Fund. Mr. Pollack has over 25 years of experience in tax-exempt portfolio management and credit analysis with Global Markets and Private Banking. He joined Bankers Trust (now Deutsche Asset & Wealth Management) in 1978. Mr. Pollack earned his B.A. and M.A. in economics from the State University of New York at Albany. He is a member of the Municipal Analysts Group of New York, the National Municipal Analysts Society and the Downtown Economist's Association. He can be reached at or emailed at Deutsche Asset & Wealth Management 15 EFTA01430468 Biographies Paul Bartilucci Managing Director, Senior Portfolio Consultant Paul Bartilucci is a Managing Director and Senior Portfolio Consultant at Deutsche Asset & Wealth Management in New York. Mr. Bartilucci has over 20 years of investment management experience. Before joining Deutsche Bank in 2010, he was a Director and Senior Portfolio Manager in the Tailored Portfolio Group at Citibank, where he was responsible for the management of equity and balanced portfolios for the Private Bank's ultra-high-net-worth clients. Mr. Bartilucci was also a member of the Equity Policy Committee which was responsible for constructing the Tailored Group's U.S. Large Cap Core portfolio. Prior to joining Citibank in 2003, Mr. Bartilucci was a Senior Portfolio Manager with Deutsche Bank, where he was responsible for the management of portfolios for Investment Advisory and Trust clients. In addition, he supported the Equity Strategy Committee, providing research on the U.S. consumer cyclical sector and convertible securities. Mr. Bartilucci earned a B.A. in economics from The College of the Holy Cross in Worcester, Massachusetts and an M.B.A. in finance and international business from New York University. He can be reached at or emailed at Deutsche Asset & Wealth Management 16 EFTA01430469 Biographies Michael J. Driscoll Director, Portfolio Consultant Michael Driscoll is a Director, Portfolio Consultant and Member of the Wealth Management Investment Advisory Committee at Deutsche Asset & Wealth Management in New York. Mr. Driscoll has been with Wealth Management for over 15 years in a variety of roles. Most recently he was the head of the Portfolio Administration Team, secretary for the Product Review Committee and a member of the Portfolio Implementation Recommendation team. Prior to that, he was the business manager of the Global Investment Management team in the Americas. Before joining Deutsche Bank in 1999, he was a consulting engineer. Mr. Driscoll earned a B.S. in civil engineering from the University of Delaware in Newark, Delaware and an M.B.A. in finance from Rutgers University. He is also Director of the HIREF Private Investors L.P. fund and the RREEF GOF II Private Investors L.P. fund. He can be reached at or emailed at Deutsche Asset & Wealth Management 17 EFTA01430470 Biographies Derek Javarone Assistant Vice President, Portfolio Analyst Derek Javarone is an Assistant Vice President and Portfolio Analyst in Deutsche Asset Wealth Management's New York office. In this capacity, Mr. Javarone supports the investment management and day-to-day maintenance for ultra-high-net-worth individuals, trusts and foundations. He has eight years of experience in the financial services industry. Mr. Javarone earned a A.B. in sociology from Princeton Universit He can be reached at or emailed at Deutsche Asset & Wealth Management 18 EFTA01430471 Additional information The following is a current list and description of the indices used in the blended benchmarks for the Composite and Model returns shown on the preceding pages. The indices are used for comparative purposes only and are not intended to parallel the risk or investment style of the investment vehicles. The S&P 500 Index is an unmanaged index containing 500 U.S. industrial, transportation, utility and financial companies. The S&P 500 Index is capitalizationweighted calculated on a total return basis with dividends reinvested. The Russell 2000 Index is a capitalization-weighted index and is rebalanced by the Frank Russell Company every June 30 to reflect changes in the marketplace. The MSCI Europe Index is a free float-adjusted market capitalization index that is designed to measure developed market equity performance in Europe. As of May 2005, the MSCI Europe Index consisted of the following 16 developed market country indices: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, the Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom. The MSCI Japan Index is a market capitalization-weighted index, adjusted for free float. The Index is designed to reflect the sectoral diversity of the Japanese equity markets. The MSCI Pacific Free ex-Japan Index is a free float-adjusted market capitalization index that is designed to measure equity market performance in the Pacific region. The index consists of the following 4 Developed Market countries: Australia, Hong Kong, New Zealand, and Singapore. The MSCI EM Index is a market capitalization-weighted index composed of companies representative of the market structure of emerging market countries in Europe, Latin America, and the Pacific Basin. The Barclays Municipal Short/Intermediate Index is a market-value-weighted index engineered for the short to intermediate part of the yield curve. Eligible bonds include General Obligations and Revenue bonds issued with maturities between one and 10 years. The Index is fairly evenly distributed along the first 10 years. In order to be included in the index, bonds must have a minimum credit rating of Baa. They must have an outstanding par value of at least $5 million and be issued as part of a transaction of at least $50 million. The 50/50 Barclays G.O./MMDI AAA 5-Year Blend is a 50/50 blend of the Barclays 5-Year Municipal G.O. Index and the Municipal Market Data 5-Year AAA. The Barclays 5-Year Municipal G.O. Index is a rules-based, market-value-weighted index engineered for the 5-Year G.O. tax-exempt bond market. In order to be included in the index, bonds must be General Obligation bonds and must have a maturity of 4-6 years, minimum credit rating of Baa. EFTA01430472 They must have an outstanding par value of at least $5 million and be issued as part of a transaction of at least $50 million. The bonds must have a dated-date after December 31, 1990 and must be at least one year from their maturity date. Remarketed issues, taxable municipal bonds, bonds with floating rates and derivatives are excluded from the benchmark. The Municipal Market Data 5-Year AAA curve is the mean of 5-Year AAA State G.O. bonds. When the supply in these credits narrows, MMD often relates to comparable AAA-rated G.O. bonds trading in the secondary or primary markets. The Barclays G/C Intermediate Index is the Intermediate component of the U.S. Government/Credit Index and includes securities in the Government and Credit indices. The Government Index includes treasuries (i.e. public obligations of the U.S. Treasury that have remaining maturities of more than one year) and agencies (i.e. publicly issued debt of U.S. Government agencies, quasi-federal corporations, and corporate or foreign debt guaranteed by the U.S. Government). The Credit Index includes publicly issued U.S. corporate and foreign debt guaranteed by notes that meet specified maturity, liquidity, and quality requirements. The Merrill Lynch High Yield Master II Index tracks the performance of below investment-grade US dollar-denominated corporate bonds publicly issued in the US domestic market. "Yankee" bonds (debt of foreign issuers issued in the US domestic market) are included in the Index provided the issuer is domiciled in a country having an investment-grade foreign currency long-term debt rating (based on a composite of Moody's and S&P). 144a issues are included in the Index. Qualifying bonds must have at least 1 year remaining term to maturity, a fixed coupon schedule and a minimum amount outstanding of USD 100 million. Bonds must be rated below investment-grade based on a composite of Moody's and S&P. Defaulted bonds are excluded. The Index is rebalanced on the last calendar day of the month. Issues that meet the qualifying criteria are included in the Index for the following month. Issues that no longer meet the criteria during the course of the month remain in the Index until the next month-end rebalancing at which point they are dropped from the Index Deutsche Asset & Wealth Management 16 19 EFTA01430473 Additional information The JP Morgan GBI Emerging Markets Index tracks local currency bonds issued by emerging market governments. The HFRI Fund of Funds Index: The HFRI Monthly Indices (HFRI) are equally weighted performance indexes, utilized by numerous hedge fund managers as a benchmark for their own hedge funds. The HFRI are broken down into 37 different categories by strategy, including the HFRI Fund Weighted Composite, which accounts for over 1600 funds listed on the internal HFR Database. The S&P/Citigroup Global REIT Index consists of all real estate investment trusts in both developed and emerging markets. The DBLCI Diversified Commodities Index represents 14 commodities drawn from the energy, precious metals, industrial metals and agriculture sectors. The iMoneyNet Money Funds (All) Tax-Free Average is presented net of fees and is used for comparative purposes only and is not intended to parallel the risk or investment style of the accounts included in the composite. The iMoneyNet Money Funds (All) Tax-Free Average includes all taxfree and municipal retail and institutional money funds. It consists of funds in the National Tax-Free Retail, National Tax-Free Institutional, StateSpecific Retail, and State-Specific Institutional categories. Emerging Markets: Emerging markets may be in transitional or formative stages and thus may be significantly less stable than developed markets. Changes in emerging markets government structures or other political instability may result in nationalization, expropriation, ad hoc regulation, or foreign investment restrictions. Emerging market investments are at risk for currency devaluation, as well as convertibility, liquidity and transparency constraints. The high volatility and speculative nature of emerging market investments may result in both significant losses or profits. Fixed Income: The values of the fixed income instruments presented will fluctuate and may lose value, as bond values decline as interest rates rise. Certain bonds and fixed income instruments presented may be callable. If called, the investor will experience a shorter maturity than anticipated. Bonds referenced herein are exposed to credit risk, or the risk that the bond will be downgraded, and inflation risk, or the risk that the rate of the bond's yield will not provide a positive return over the rate of inflation. Information contained herein is presented to provide clients with a sample listing of the Fixed Income Group inventories and other fixed income securities. The investments are subject to availability, and the prices may not represent current market yields and prices. Detailed information on each instrument presented is available upon request. This is not an offer to buy or sell securities, some of which might require a prospectus. Before entering into any transaction you should take steps to ensure that you understand and have assessed with your financial advisor, or made an independent assessment of, the appropriateness of the transaction in the light of your own objectives and circumstances, including the possible risks and benefits of entering into such a transaction. Clients are advised to refer to FINRA's online learning center Smart Bond Investing, which provides a wealth of information about bonds and bond EFTA01430474 investing, and is available at via the website http://apps.finra.org/- investor Information/smart/bonds/000100.asp. Tax Free Municipal bonds are subject to changes in price, call and availability. Under present law, these bonds provide exemption from federal tax and depending on your state of residence may be exempt from state and local tax. Income may be subject to the Alternative Minimum Tax. There are additional risks associated with International investing. Deutsche Asset & Wealth Management 17 20 EFTA01430475 Important information Mutual Funds — Changing market conditions can create fluctuations in the value of a mutual fund investment. When redeemed, a mutual fund may be worth more or less than its original cost . In addition, mutual funds are not insured nor guaranteed by an agency of the U.S. government. Mutual funds offer diversification which can help to reduce risk of loss from holding a single security, but diversification does not protect an investor from an overall decline in the market. While a money market fund seeks a stable share price, its yield fluctuates. Bond funds, unlike purchasing a bond directly, will not re-pay the principle at a set point in time . If the fund is purchased in a taxable account, taxes may have to be paid on capital gains. Investors should seek to obtain and read carefully the prospectus offered for each mutual fund considered for investment. There are fees and expenses associated with investing in mutual funds that do not usually occur when purchasing individual securities directly. An investor should consider the objectives, risks, and charges and expenses of the fund carefully before investing. The efficiencies of fund ownership may be offset by a combination of sales commissions, 12b-1 fees, redemption fees, and operating expenses. A detailed prospectus which contains important information, including the fund's investment objectives, risks, fees and expenses, will be forwarded when funds were initially invested into the Fund. Prospective clients may also contact their Client Advisor for a prospectus. Deutsche Bank may have certain conflicts of interest in recommending investments in certain funds, including the fact that we may receive 12b-1 fees and other compensation from the funds and their investment advisers and that funds may execute transactions through Deutsche Bank. Money Market Funds — An investment in a money market fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although these funds seek to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund. The credit quality of the fund's holdings can change rapidly in certain markets, and the default of a single holding could have an adverse impact on the fund's share price. The fund's share price can also be negatively affected during periods of high redemption pressures and/or illiquid markets. The actions of a few large investors in one class of shares of the fund may have a significant adverse effect on the share prices of all classes of shares of the fund. Reinvestment — The dollar amount of Mutual Fund distributions, Money Market fund income, or dividends or other securities shown on your statement may have EFTA01430476 been reinvested into additional shares. You will not receive confirmation of these reinvestment transactions. However, information pertaining to these transactions which would otherwise appear on confirmations, including the time of execution and the name of the person from whom your security was purchased, will be furnished to you upon written request to your Relationship Coordinator. Small Cap and International Funds — Small Cap funds and International funds contain additional risks, as they often invest assets in small and / or start-up companies. Such investments increase the risk of greater price fluctuations and loss. Investments in International mutual funds may also contain investments which are potentially exposed to economic or financial instability, specific to each country or currency risks, or if hedged, the cost incurred due to the hedging of currency risks. Additionally, lack of timely or reliable financial information or unfavorable political or legal developments may substantially and permanently alter the conditions, terms, marketability, or price of the underlying investments by the fund. Hedge Fund- An investment in hedge funds is speculative and involves a high degree of risk, and is suitable only for "Qualified Purchasers" as defined by the U.S Investment Company Act of 1940, as amended, and "Accredited Investors" as defined by Regulation D of the 1933 Securities Ac, as amended. No assurance can be given that a hedge fund's investment objectives will be achieved, or that investors will receive a return of all or part of their investment. Investments in hedge funds are suitable only for persons who can afford to lose their entire investments. Before investing, prospective investors should carefully consider these risks and others, such as lack of transparency, higher fees, illiquidity, and lack of registration. Values for Hedge funds are estimates until final values are provided by the fund administrator. Hedge Fund market value and performance represents the most up to date estimate provided by the fund administrator which differs from the Deutsche Bank statements that represent values at a one month lag. Deutsche Asset & Wealth Management 18 21 EFTA01430477 Important information Bond Funds — Bond funds may lose value, as the principal is not guaranteed and the fund's net asset value will fluctuate, as bond prices fluctuate and individual bonds will be bought and sold by the Investment Advisor, resulting in gains or losses. Generally, when interest rates go up, bond prices decline, which will negatively impact the fund's share price. Bond funds are also exposed to credit risk, or the risk that the fund's individual bonds will be downgraded, and inflation risk, or the risk that the rate of the bonds' yield will not provide a positive return over the rate of inflation. Exchange Traded Products — The value of an Exchange Traded Product is derived from other investment instruments such as a commodity, currency, share price or interest rate. Generally, exchange traded products are benchmarked to stocks, commodities, indices or they can be actively managed funds. Exchange traded products include exchange traded funds (ETFs), exchange traded vehicles (ETVs),and exchange traded notes (ETNs). An Exchange Traded Product does not provide investors with entitlements to the underlying security. ETPs are subject to market risk and will fluctuate in value based on movements in the underlying securities. Investors should realize that redemption values of ETPs are based upon the market value at the time of order and not at the net asset value as is the case for mutual funds. Investments in ETPs are subject to management fees. High Yield Fixed Income Securities — Investing in high yield bonds, which tend to be more volatile than investment grade fixed income securities, is speculative. These bonds are affected by interest rate changes and the creditworthiness of the issuers, and investing in high yield bonds poses additional credit risk, as well as greater risk of default. Real Estate Investments — Such investments may be or become nonperforming after acquisition for a wide variety of reasons. Nonperforming real estate investments may require substantial workout negotiations and / or restructuring. Environmental liabilities may pose a risk such that the owner or operator of real property may become liable for the costs of removal or remediation of certain hazardous substances released on, about, under or in its property. Additionally, to the extent real estate investments are made in foreign countries, such countries may prove to be politically or economically unstable. Finally, exposure to fluctuations in currency exchange rates may affect the value of a real estate investment. Commodities — The risk of loss in trading commodities can be substantial. The price of commodities (e.g., raw industrial materials such as gold, copper and aluminum) may be subject to substantial fluctuations over short periods of time and may be affected by unpredicted international monetary and political policies. Valuations of commodities may be susceptible to such adverse global economic, political or regulatory EFTA01430478 developments. Prospective investors must independently assess the appropriateness of an investment in commodities in light of their own financial condition and objectives. Exchange Traded Funds - Ownership in an exchange traded fund does not provide investors with entitlements to the underlying security. Rather investors own a "creation unit" in a portfolio of stocks, bonds, or other securities. ETFs are subject to market risk and will fluctuate in value based on movements in the underlying security. Investors should realize that redemption values of ETFs are based upon the market value at the time of order and not at the net asset value as is the case for mutual funds. Investments in ETFs are subject to commission charges and management fees. Deutsche Bank may have certain conflicts of interest in recommending investments in certain funds, including the fact that we may receive 12b-1 fees and other compensation from the funds and their investment advisors and that funds may execute transactions through Deutsche Bank. Carefully consider a Fund's investment objectives, risk factors and charges and expenses before investing. This and other information can be found in the Fund's prospectus, which may be obtained by calling 1-855-DBX-ETFS (1-855-329-3837), or by viewing or downloading a prospectus. Read the prospectus carefully before investing. The Citigroup Unhedged Non-US World Government Bond Index (WGBI) is a market capitalization-weighted index consisting of the government bond markets of certain countries. Country eligibility is determined based on market capitalization and investability criteria. All issues have a remaining maturity of at least one year. Rebalanced monthly. The Barclays U.S. Tips Index consists of securities issued by the U.S. government which are protected from Inflation. Each security must be investment-grade and have a par of at least $200,000,000 as well as have at least one year left until maturity. Deutsche Asset & Wealth Management 19 22 EFTA01430479 Important information This document is for information purposes only and is not intended to be an offer or solicitation, or the basis for any contract to purchase or sell any security, or other instrument, or for Deutsche Bank to enter into or arrange any type of transaction as a consequence of any information contained herein. The material is based upon information which we consider reliable, but we do not represent that such information is accurate or complete, and it should not be relied upon as such. This information is current and is subject to change. The products and services described in this document are not appropriate for everyone, so an interested party must make his or her own independent legal, tax, accounting and financial evaluation of their merits and risks. Opinions expressed herein may differ from the opinions expressed by departments or other divisions or affiliates of Deutsche Bank. The investment ideas presented herein are subject to investment risk, including possible loss of principal. The past performance of securities or other instruments does not necessarily indicate or predict future performance and the value of investments and income arising there from can decrease as well as increase, the investor may get back less than was invested and no assurance can be given that any investment described herein would yield favorable investment results. Unless you are notified to the contrary, these strategies are not insured by the FDIC (or by any governmental entity) and are not guaranteed by, or obligations of, Deutsche Bank. Deutsche Bank AG, including its subsidiaries and affiliates, does not provide legal, tax or accounting advice. This communication was prepared solely in connection with the promotion or marketing, to the extent permitted by applicable law, of the transaction or matter addressed herein, and was not intended or written to be used, and cannot be relied upon, by any taxpayer for the purposes of avoiding any U.S. federal tax penalties. The recipient of this communication should seek advice from an independent tax advisor regarding any tax matters addressed herein based