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RAFI Fundamental Developed Index

DATA AS OF: 09-30-2018  ASSET CLASS: Equity

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Commentary

The RAFI Fundamental Developed Index underperformed its benchmark, the FTSE AW Developed, by 79 bps for the quarter driven by continued headwinds in value (5.1% for MSCI World vs. 4.2% for MSCI World Value). The consumer cyclical and health care sectors were the biggest detractors to return at -22 bps and -13 bps, respectively. The underperformance in consumer cyclicals was driven by an underweight to Amazon which detracted 19 bps. Similar to Global, underweights to Apple and Microsoft also detracted from performance (-10bps and -9bps respectively) while the underweight to Facebook proved to be the biggest contributor (19 bps).

Trailing Returns

SOURCE: FactSet | Data: As of 09/30/2018 in USD  |  INCEPTION DATE: 01/31/2017

* Inception to Date (ITD) uses the first full month of returns after inception date. All returns prior to inception are simulated, please see disclosures for important information regarding simulated performance.

** Annualized tracking error calculated against each section’s appropriate benchmark using the first full month of returns following index inception. Index returns prior to inception are simulated.

Characteristics

SOURCE: FactSet | Data: As of 09/30/2018 in USD  |  INCEPTION DATE: 01/31/2017

NOTE: Portfolio characteristics derived from FactSet. Data prior to launch is simulated. One-way turnover data is historical average based on simulated history. Capacity is estimated at 50 basis point market impact level.

Top 10 Holdings

SOURCE: FactSet  |  DATA: As of 09/30/2018 in USD

Sectors

SOURCE: FactSet  |  DATA: As of 09/30/2018 in USD

Regions

SOURCE: FactSet  |  DATA: As of 09/30/2018 in USD

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