The document provides a quarterly review and outlook from Eastgate Advisors. It summarizes key economic indicators, index returns, and Eastgate's portfolio performance for the quarter. It then analyzes factors affecting returns, discusses risks, and outlines Eastgate's strategic and tactical outlook over the next 1-3 and 3-5 years, respectively. They expect mid-single digit returns for global equities but lower returns for bonds given rising interest rates and continued low global growth and inflation.

1. © Eastgate Advisors, llc, 2016 Page 1
Eastgate Advisors, llc
Quarterly Review and Outlook
Other Key Indicators Qtr-End Prev Qtr-End Year-End 2015
10-Year US Treasury Bond Yield 1.6% 1.5% 2.3%
CBOE VIX S&P 500 index implied volatility (annualized %) 13.3% 15.6% 18.2%
Shiller S&P 500 Cyclical Price-to-Earnings Ratio (trailing 10-year) 26.4 26.7 24.2
Brent Crude Oil price/barrel $46 $48 $37
US Industrial Production (y/y % change, seasonally adjusted) -1.0% -0.6% -2.3%
US Personal Consumption x food & energy (y/y % change,sa) +1.7% +1.6% +1.4%
US Consumer Price Index all items (y/y % change, sa) +1.5% +1.0% +0.7%
US 5-Year Inflation Expectations, 5-Years Forward +1.8% +1.4% +1.8%
US Real GDP (y/y % change, sa) +1.5% +1.3% +1.9%
Quarter in Review
Ruminations on the UK’s “Brexit” vote and US presidential campaign held investor attention during the typically dull
summer vacation period in the US and Europe. The US Federal Reserve declined to raise its Fed Funds rate in July and
September but hinted at the possibility of one increase before year-end. The US dollar weakened against major
currencies helping US dollar denominated investors in non-US markets. Even though the S&P 500 index reached a
historic high in September, reported earnings among index constituents may have fallen for the sixth consecutive
quarter. Non-US equities out-performed US equities. Emerging markets debt and equities out-performed developed
markets driven by improving economic fundamentals. The table below shows the yields on severalten-year sovereign
debt issues at quarter-end. US 10-year treasury yields look attractive to yield seeking investors compared with those of
other major sovereign debt issues and shows that lower US yields are possible. We note that the 10-year US Treasury
hit a historic low yield under 1.4% in July. One-third of global sovereign debt carried negative yields at quarter-end.
US Treasury
10-Year Yield
German Bund
10-Year Yield
Japan JGB
10-Year Yield
United Kingdom Guilt
10-Year Yield
Swiss
10-Year Yield
+1.6% -0.1% -0.1% +0.7% -0.5%
Index Returns Quarter 1-Year 3-Years 5-Years
MSCI All Country World stockindex 5.3% 12.0% 5.2% 10.6%
S&P 500 index 3.8% 15.4% 11.2% 16.4%
Barclays US Universal Bond index 1.0% 6.1% 4.3% 3.6%
Citi 3-month US Treasury Bill index 0.07% 0.20% 0.09% 0.08%
Bloomberg Broad Commodities Index -3.9% -2.6% -12.3% -9.4%
Eastgate Advisors’ Returns1
Quarter 1-Year 3-Years 5-Years
Moderate Risk Global Asset Allocation Net-of-Fee Composite1 3.4% 8.0% 3.7% 6.7%
Moderate Risk Strategic Benchmark2 (@ -10% down-side risk) 3.0% 8.6% 4.5% 6.8%
MorningstarWorld Allocation Net-of-Fee Universe (806 funds) 3.1% 8.3% 2.8% 6.7%
Other Global Asset Allocation Strategy Benchmark Returns Quarter 1-Year 3-Years 5-Years
Conservative Allocation (@ -5% down-side risk) 2.4% 7.6% 4.3% 5.9%
Growth Allocation (@ -15% down-side risk) 3.7% 9.8% 4.8% 8.1%
Aggressive Allocation (@ -20% down-side risk) 4.6% 11.2% 5.1% 9.6%

2. © Eastgate Advisors, llc, 2016 Page 2
*Based on quarter-end manager holdings. Gross exposures may not sum to 100%.
Return Analysis
Our return objective is to out-perform the strategic benchmark after fees, over a three-to-five-year investment horizon.
We seek to add value through asset allocation decisions, external manager selection, manager allocation decisions, by
managing investment risk, maintaining adequate liquidity and controlling investment costs.
Active Decision Quarterly Value Added Versus The Strategic Benchmark
Asset Allocation +0.41%
Manager Selection +0.01%
Manager Allocation -0.01%
Total Quarterly Net-of-Fee Value Added: +0.41%
What affected returns during the quarter?
Underlying holdings analysis at quarter-end showed that we had higher small and mid-cap global equity exposures,
more non-US fixed income and more non-dollar bonds than the strategic benchmark. Other key factors that affected
returns:
 An over-weight to global equities helped but an under-weight to emerging markets hurt performance.
 An over-weight to emerging market bonds and non-investment grade debt helped.
 An under-weight to money markets helped as global equities and bonds performed well.
 The alpha portfolio (active managers) under-performed the passive global markets portfolio.
Risk Management
In managing investment risks, we seek to eliminate idiosyncratic risks, to manage market and active risks and control
leverage in order to keep annual down-side risk at no more than -10% in nine-of-ten years while maintaining adequate
liquidity and earning a return which we believe fairly compensates investors for risk. We have explicit allocation limits
in place for each active manager. We also have a 3% maximum annual active risk budget. This means that we should
expect to earn the return of the strategic benchmark plus or minus 3% in seven-of-ten years. That is why the strategic
benchmark is a key part of our investment process.
Key Risk Metrics Metric Value Q/Q Change
Estimated 12-month down-side risk potential (@ 90% confidence): -9% (+)
Risk relative to the strategic benchmark (leverage): 1.0 x (-)
% of return explained by the strategic benchmark allocation (R2): 97% (-)
Estimated annual active risk (tracking error): 1.1% (+)
Active allocations % of total fund (active managers + tactical allocations): 31% (+)
Weighted average annual expense ratio: 0.33% (+)
Number of global stocks (idiosyncraticrisk indicator): 5,377 (-)
Number of global bonds: 6,760 (+)
Estimated interest rate sensitivity relative to the strategic benchmark index: 100% (-)
Asset Class Allocations* US Equities
Non-US
Equities
Global Bonds Commodities
Money
Markets
Eastgate Moderate Risk Weight 30.1% 23.1% 38.7% 1.0% 7.7%
Strategic Benchmark Weight 26.1% 23.9% 40.0% 0.0% 10.0%
Eastgate Advisors Over/Under Weight +4.0% -0.8% -1.3% 1.0% -2.3%

3. © Eastgate Advisors, llc, 2016 Page 3
Looking Ahead
We are not focused on a quarter-to-quarter or a year-to-year investment horizon. Strategically, we maintain exposure to
global markets with historic risk premia in excess of the return of a risk-free asset,like a treasury bill. We seek to
control costs, manage risks and maintain adequate liquidity. Over a one-to-three year investment horizon, we
determine tactical allocations to global equities, global bonds, commodities, and money markets based on valuations
and our expectations for inflation and economic growth. In attempting to add additional value, we may use active
external investment managers with whom we have had years of favorable experiences.
Our three-to-five year strategic outlook is for slow global economic growth and modest inflation. The global economy
remains mired in an excess debt induced, low growth environment. Sovereign bond yields in severaleconomies reflect
deflationary pressures. Market expectations for US inflation over the next five years are under 2% with modest
inflation in most developed global economies. The US Treasury yield curve has flattened since December 31, 2015
driven by high demand for yield from pension funds, insurance companies and global investors whose local sovereign
bonds carry negative yields. This dynamic may continue as long as US treasuries hold a yield advantage over other
sovereign issues and it puts upward pressure on the US dollar in what is likely a rising short-rate environment in the
US. Our one-to-three year tactical outlook suggests a near benchmark weight to global public equities relative to the
strategic benchmark and a higher volatility investing regime.
Based on our bottom-up fundamental input models, we expect public global equity market returns in the mid-single
digits over our three-to-five year strategic investment horizon. The yield-to-maturity of the Barclays US Universal
index (our preferred bond index) implies expected annual returns to US bonds under 2.4% over our strategic
investment horizon. Rising rates would reduce realized bond market returns further. Market estimates of the Fed Funds
rate imply money market returns near one percent over our one-to-three year tactical investment horizon. Barring an
unexpected rise in global inflation or consumption driven growth, commodities as an asset class remain unattractive
given weak global demand and an over-supply for many of them although we added an allocation to gold via an
exchange traded fund (ETF) as a volatility hedge during the quarter.
Risks to allocations over our investment horizon include excessive debt in major global economies which increase
deflationary pressures that harm growth prospects. Risks also include unanticipated inflation; a significant geopolitical
shock, an emerging markets crisis or a contagion effect of the British exit from the EU. The impact of the UK’s exit
from the European Union on both the UK and EU is a big unknown and is likely to only be realized over severalyears.
Reduced trading liquidity in corporate bonds, to which we are over-weight relative to the strategic allocation
benchmark, continues to be a concern. High equity valuations increase the risks of investing in the asset class if
corporate earnings continue to decline. Price-to-earnings ratio (multiple) expansion and not earnings growth has
sustained US equity market returns over the past couple of years. We don’t expect this to continue.
Thank you for taking time to read our thoughts. Contact Greg Johnsen, CFA with questions or comments at:
gjohnsen@eastgateadv.com. Connect with Greg on Linked In. His Linked In profile: gregjohnsencfa.
Important Disclosures
1The Eastgate Advisors’ Moderate Risk global allocation composite return is the realized net-of-fees, assetweighted,geometric
average total return of several public markets accounts of a private familyinvestmentoffice. Returns in excess of one-year are
annualized.Returns are through 9-30-2016.
2 The Moderate Risk Allocation strategic benchmark is an unmanaged combination ofbroad marketindices.It consists of50% of
the return of the MSCI All Country World ™ stock index (net), 40% of the Barclays US Universal Bond ™ index and 10% US
treasury bills.
Holdings analytics:Morningstar Advisor Workstation. Performance analysis and attribution:Eastgate Advisors,llc.
Economic data sources:US Federal Reserve,US Departmentofthe Treasury, US Bureau of Economic Analysis,RobertShiller,the
Economist,World Bank,International Monetary Fund, Factset Research Systems.
Visit our website: www.eastgateadvisors.com or Linked In companypage: https://www.linkedin.com/company/eastgate-advisors?