What do the boxes mean?

The style box represents the fund's investment objective and is not reflective of the historical or current holdings of the portfolio.

International Equity Index

International Equity Index Strategy

The Fund seeks to provide investment results that correspond to the aggregate price performance of the securities included in the Morgan Stanley Capital International Europe, Australasia, Far East (EAFE), GDP Weighted Index.

What principles have enabled the strategy to be successful?

Stratified sampling — a stratified sampling methodology is employed to select stocks for the portfolio, avoiding those names whose market-cap or trading liquidity make them inefficient holdings. This selection process has the potential to improve the quality and practicality of the basket of selected stocks.

Multi-factor risk model — the investment team sets country weights of the portfolio equal to the country weights of the index. They then set a bound of +/- 1% on the sector weights of each country portfolio relative to the sector weights of the respective country index. The optimized portfolio is designed to minimize the variance of returns.

Minimized tracking error — the team strives to minimize turnover and transaction costs by avoiding illiquid securities and unnecessary trading. The team’s efficient management of transactions helps minimize undesired tracking error.

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