Steinberg Global Asset Management Ltd' MultiCap ETF Model

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Steinberg Global Asset Management Ltd.Multi-Cap
ETF Model
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Overview

• A Registered Investment Adviser with the
  Securities Exchange Commission under the
  Investment Advisers Act of 1940
• Founded in 1993
• Offices in Boston and Boca Raton
• Over 500 million under management
• Clients are high net worth individuals,
  retirement and pension plans, trusts, estates,
  foundations and private corporations.
• Managers/Directors worked at major financial
  institutions as senior officers with many years
  of investment experience

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Description Multi Cap ETF Model

• An actively managed portfolio for managed
  accounts to invest in exchange traded funds.
• Use proprietary research for fundamental analysis
  of investment indices.
• Developed models for valuing various market
  sectors including calculating earnings estimates
  for ETFs from consensus earnings estimates for
  each funds underlying holdings.
• Fundamental valuation analysis tools utilized in
  the investment process.
• Patent pending with the US Patent Office for the
  process of calculating EEE (ETF Earnings
  Estimates)

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Objective

• Outperform the SP 1500 after adjusting for risk
  and fees using a diversified basket of ETFs
• Provide investors a unique opportunity to fulfill
  the core portion of equity exposure
• Enable investors to seek alpha around the core
  model with outside managers or strategies.

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Core Approach

• Building A Foundation
• Observed for stability
• Maintained/repaired for longevity
• Select portfolio of ETFs that we feel will
  outperform the market for at least a 3 to 5 year
  period
• Seek ETFs trading at p/e multiples that are less
  than their 3 to 5 year projected growth rates
• Typically avoid speculative ETFs in which p/es
  are unjustifiable to growth rates
• Neither momentum investors nor market-timers

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Identifying Inefficiencies

• Comparison of statistical measures of a ETF
  memberships health in relation to its sector and
  the market as a whole.
• Identify ETFs currently displaying favorable
  business characteristics through Value, Growth
  and Technical approaches.
• Screen underlying stocks of ETFs for quality
  factors through analysis of
• Price/Sales Price/Book
• Price/Free Cash Flow Return on Equity
• Profit Margin Debt/Equity
• Interest Coverage Price/Earnings
• Relative Strength Other Pertinent Ratios
• Identify timely investments for ETFs.

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Target/Reward Analysis

• Goal Above market capital appreciation at either
  below market multiples or at discounts to an ETF
  holdings long-term growth rates
• Earnings estimates and estimated p/e ratios are
  integrated in firms portfolio management system.
  We focus on current year estimates, next year
  estimates and the year-over-year growth of those
  estimates
• When ETFs reach full value (i.e. approach
  target/reward price), decisions become to raise
  estimates/rewards, scale back position, sell full
  positions or do nothing. Each decision is made
  on a security-by-security basis.
• At times, full valuation securities are held due
  to relative yields, pauses in economic/earnings
  cycles, as well as other factors.
• Major support and resistance parameters are used
  to indicate technical strength or weakness of
  holdings

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Investment Committee Review

• Economic Outlook
• GDP, retail sales, inflation, etc.
• Stock/Fixed Income market outlook
• Asset allocation
• Interest rates
• Sector outlook
• Overweight/underweight
• New ideas
• Additions/deletions from approved list
• Buys/Sell Discussion
• Review stocks that have reached reward targets or
  need adjustment

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Institutional Relationships

• Steinberg Global is an active participant in
• The Schwab AdvisorNetwork at Charles Schwab
  Co., Inc. a service that refers individual
  investors to independent fee-compensated
  Investment Managers
• Charles Schwab Co.s Separate Account Manager
  Program. Managed Account Marketplaces platform
  enables other investment advisors to work with
  Steinberg Global in managing their clients
  assets.