- Over the past 20 years, the average annual return of the S&P 500 was 7.8%, but the average equity fund investor earned only 3.5% due to being motivated by fear and greed rather than sound investment practices. - Investors who reacted to market volatility by frequently buying and selling earned lower returns than buy-and-hold investors in the S&P 500 and other major indices. - One of the main reasons for this performance shortfall is that investors are motivated more by emotions like fear and greed rather than following sound long-term investment strategies.

1. Stay the Course
Average Investor vs. Major Indices 1992 - 2011
7.8%
6.5%
3.5%
2.6%
0.9%
S&P 500 Barclay's Average Equity Inf lation Average Fixed
Index Bond Index Fund Investor Income Investor
Average stock investor and average bond investor performances were used from a DALBAR study, Quantitative Analysis of Investor Behavior (QAIB), 03/2012. QAIB calculates investor returns as the change in assets after excluding sales,
redemptions, and exchanges. This method of calculation captures realized and unrealized capital gains, dividends, interest, trading costs, sales charges, fees, expenses, and any other costs. After calculating investor returns in dollar terms
(above), two percentages are calculated: Total investor return rate for the period and annualized investor return rate. Total return rate is determined by calculating the investor return dollars as a percentage of the net of the sales, redemptions,
and exchanges for the period. The fact that buy-and-hold has been a successful strategy in the past does not guarantee that it will continue to be successful in the future. #03-198. Materials provided to approved advisors by LWI Financial
Inc. (“Loring Ward”). Securities offered through Loring Ward Securities Inc., member FINRA/SIPC.

2. Investors Motivated by Fear & Greed
• Over the past twenty years, the
S&P 500 Index has posted
impressive returns, yet the
“average equity fund investor”
has earned only a fraction of
these results.
• One of the principal reasons for
the shortfall is that investors are
motivated by fear and greed -
not by sound investment
practices.
The performance quoted represents past performance. Past performance does not guarantee future results. Indexes are unmanaged baskets of securities that investors cannot directly invest in;
they do not reflect the payment of advisory fees or other expenses associated with any specific investments. Standard & Poor's (S&P) 500 Composite Index is an index representative of U.S. large
company stocks.
The average investor refers to the universe of all equity mutual fund investors whose actions and financial results are restated to represent a single investor. This approach allows the entire
universe of mutual fund investors to be used as the statistical sample, ensuring ultimate reliability. DALBAR, Inc., “Quantitative Analysis of Investor Behavior,” 2012. Average stock investor and
average bond investor performances were used from a DALBAR study, Quantitative Analysis of Investor Behavior (QAIB), (03/2012). QAIB calculates investor returns as the change in assets,
after excluding sales, redemptions and exchanges. This method of calculation captures realized and unrealized gains, dividends, interest, trading costs, sales charges, fees, expenses and any
other costs. After calculating investor return in dollar terms, two percentages are calculated: Total investor return rate for the period, and Annualized investor return rate. Total return rate is
determined by calculating the investor return dollars as a percentage of the net of the sales, redemptions and exchanges for the period. Annualized return rate is calculated as the uniform rate that
can be compounded annually for the period under consideration to produce the investor return dollars. The fact that the Buy & Hold has been a successful strategy in the past does not guarantee
that it will continue to be successful in the future.