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October 16, 2009
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Table of Contents
1) Introduction: Mike Fields and Sam Silver
2) Assessing American Mike FieldsBeacon Advisors: Chief Fixed Income Officer
3) Portfolio Overview: Sam SilverSenior Portfolio Manager
•Over 25 years of Investment Experience•Founding Member of American BeaconAdvisors
•Member of Team LAMP since Inception ofEngagement
•Over 20 years of Investment Experience•Member of Team LAMP since Inception ofEngagement
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People•Experienced•Academically Accomplished
•Bench Strength•Alignment
•No Team LAMP Turnover
American Beacon Advisors
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Process•Consistency
•Bottom‐Up Proprietary Credit Research
•Top‐Down, Sector Rotation PortfolioConstruction
•Robust Compliance Monitoring
American Beacon Advisors
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Performance•Best in Class Performance
•Best Performance amongst LAMP’s Prior Multi‐Manager Line‐Up
•ABA’s Historical LAMP Performance ImpliedRanking is at the Very Top of the LipperInstitutional U.S. Government Money MarketFunds’ Universe of the 5 year period endingDecember 31, 2008.
American Beacon Advisors
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Ranks Number One in theLipper Fixed Income Fund Performance Analysis Service
Five Years Period Ending December 31, 2008
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Fed Funds Target
9/16/2008
12/16/2008 Today
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Interest Rates
3mth LIBOR
Peaked on 10/10/08@ 463 bps
TED Spread 21 bps @ 10/6/09
3mth T‐bill
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Median Rate Forecasts
Bloomberg Survey of Economists – 10/08/09
Time Period: 1Q10 2Q10 3Q10 4Q10
Fed Funds Forecast: 0.25% 0.25% 0.25% 0.50%
3 Month Libor Forecast: 0.35% 0.40% 0.55% 0.95%
2 Year T-Note Forecast: 1.08% 1.25% 1.50% 1.80%
10 Year T-Note Forecast: 3.50% 3.60% 3.73% 3.90%
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Portfolio Investment Objectives
•Safety of Principal
•Liquidity
•Yield
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Portfolio Overview
Net Asset Value (NAV): Stable $1.00
Credit Quality: A‐1+/A‐1
Very High
Diversification: 3% Issuer Limitation on Commercial Paper not to exceed 30% of Portfolio
Weighted Avg. Maturity: 60 Days or less
Maximum Maturity: 397 Days
Liquidity: Daily
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Portfolio Overview
Security Types:
•U.S. Gov’t Repurchase Agreements
•“AAA” Rated U.S. Gov’t MM Funds
•U.S. Treasury Bills
•U.S. Government Agency Securities
•Commercial Paper
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Portfolio Credit Quality
As of October 1, 2009 Actual or Implied S&P Long‐Term Debt Ratings
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Implied Correlation of Short-Term and Long-Term Ratings
S & P Rating Scale
Short‐Term Long‐Term
A‐1+ AAA
A‐1+ AA+
A‐1+ AA
A‐1+ AA‐
A‐1 A+
A‐1 A
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Portfolio Credit Quality
As of October 1, 2009 S&P Short‐Term Debt Ratings
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Portfolio Interest Rate Risk
As of October 1, 2009
35%40%
22%
3%
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As of October 1, 2009
Portfolio Credit Duration Risk% of P
ortfolio
Cumulative Days to Final Maturity Distribution
Weighted Average Days to Final Maturity: 58 Days
35%
75%
97% 100%
Overnight Liquidity ≤3 months ≤6 months >6 months
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Portfolio Composition
As of October 1, 2009
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•Stable Net Asset Value•Rigorously Monitored Approved Issuers
•Very High Credit Quality•Maximum Weighted Average Duration of 60 Days
•Able to Adapt Quickly to Interest Rate Changes•Robust Compliance Monitoring
Equals
AAAm Rating by S&P
Conclusion