INVESTMENT PRESENTATION TO

Momentum: Think-tank 2015

Mark B. Baribeau, CFA
Managing Director,
Head of Global Equity and
Global Equity Portfolio Manager

The information contained in this presentation is directed only to qualified professionals and eligible institutional investors. Distribution of this information to any
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The information provided herein is being provided at your request for informational purposes only. Jennison Associates LLC has not been licensed or registered to
provide investment services in any jurisdiction outside the United States. The information contained in this presentation should not be construed as a solicitation or
offering of investment services by Jennison or a solicitation to sell or a solicitation of an offer to buy any shares of any securities (nor shall any such securities be
offered or sold to any person) in any jurisdiction where such solicitation or offering would be unlawful under the applicable laws of such jurisdiction. This material is
not intended to be relied upon as investment advice and is not a recommendation to adopt any investment strategy.
For investment professional use only. Not for redistribution.

September 30, 2015

Navigating Global Equities Through a Maturing Cycle

What has happened Since the Global Financial Crises Ended?

The China Super Cycle is Ending
Chinese transition from Investment/Export led GDP growth to Consumption led model has
led to a bumpier ride for the global economy

Global Deleveraging has Contributed to Structurally Lower Global GDP Growth

The current economic cycle is mature and the typical inflation increase and capex cycle has yet
to materialize

The Dispersion of Equity Returns has been Elevated

Both sector and geographic return attribution has seen a pattern of growing dispersion since
early 2011
Innovative sectors have benefited from strong organic growth, unique and disruptive business
models, and share gains

More traditional sectors were dampened by low unit growth, excess capacity, and lack of
pricing power

For investment professional use only.

The US has Produced Robust Returns Since Early 2011

MSCI All Country World Index Geographic Total Returns, January 1, 2011 through August 31, 2015

Developed North America

United States
Canada
Developed Europe
Ireland
Denmark
Belgium
Switzerland
Netherlands
United Kingdom
Germany
France
Sweden
Finland
Spain
Israel
Italy
Norway
Austria
Portugal
Greece
Developed Asia / Pacific
New Zealand
Japan
Hong Kong
Australia
Singapore

Total Return %
10.59
11.82
-3.27
4.58
16.10
12.71
11.82
8.47
7.24
4.57
4.50
3.53
2.92
1.38
1.04
0.91
0.35
-4.05
-8.93
-11.94
-31.76
2.82
6.35
4.28
4.05
-1.43
-1.54

Source: FactSet and MSCI. Past performance does not guarantee future results. See Notes 1, 2, 3 & 4.
For investment professional use only.

Emerging Markets
Philippines
Thailand
China
Taiwan
Qatar
Mexico
South Africa
India
Egypt
Korea
Malaysia
Indonesia
Czech Republic
Poland
Morocco
Hungary
Turkey
Russia
Peru
Colombia
Chile
Brazil

Total Return %
-4.52
11.95
2.45
0.26
-0.29
-0.52
-1.69
-2.33
-2.48
-2.59
-3.24
-3.60
-4.04
-4.29
-5.46
-6.69
-7.58
-8.44
-11.59
-11.75
-12.34
-13.34
-18.35

Four Sectors have Driven the Positive Return of Global

Equity Markets
MSCI All Country World Index Sector Returns, January 1, 2011 through August 31, 2015

Health Care
Consumer Discretionary
Information Technology
Consumer Staples
Telecommunication Services
Industrials
Financials
Utilities
Energy
Materials

Source: FactSet and MSCI. Past performance does not guarantee future results. See Notes 1, 2, 3, 4 & 5.
For investment professional use only.

Total Return %
18.10
11.42
9.80
9.76
5.73
5.50
4.81
2.16
-3.92
-7.08

Case Study:
Navigating in an Era of Disruptive Technology
SMARTPHONE REVOLUTION

2 billion people use smartphones with an Internet connection (Strategy Analytics)

From 2009 to 2013, the mobile industry invested $1.8 trillion on improving its infrastructure around the
world (Boston Consulting Group)
Download speeds have increased by a factor of 12,000; Data rates have dropped to cents per megabyte.
With Wi-Fi, its feasible to supplement phone computing power with data-centers

Source: The Economist Newspaper Limited, London (February 28, 2015). See Note 3.
For investment professional use only.

Investment Opportunities and Risks from Innovation and

Disruption in the Digital Age
What does innovation, technological disruption, and change mean for equity investors in
the digital age?

Winner take all

First-mover advantage
Accelerated response to shifting consumer behavior is critical
Scientific advances are applied faster
Business models can skip brick and mortar
Longer-duration competitive advantage is sticky with success
Hurdle for business success of well-capitalized later-stage entrants is very high

For investment professional use only.

China Will Drive the Incremental Opportunity and Risks for

Global Equity Markets

China is not in a recession, however, growth has slowed quickly and has surprised to the downside

Chinese investment and export led growth is weak and no longer provides a path forward for higher
Chinese GDP growth

The Chinese consumer remains strong and the economy has only started the transition to a more
consumption led GDP growth phase, however, economic transitions of this type have typically been
disruptive

Deleveraging of corporate balance sheets in China have only started and SOE reform has slowed while
capacity utilization remains low for all industrial sectors

Recent policy decisions and implementation have been poorly handled across both the FX and domestic
equity markets- elevating the risks associated with economic rebalancing

Residential property prices remain high and remain the key driver of household wealth

Chinese corporate performance and profitability growth is uneven with pockets of strength in the new
economy

See Note 6.
For investment professional use only.

Notes
These materials may not take into account all individual client circumstances, objectives or needs. Jennison makes no representations regarding the suitability
of any securities, financial instruments or strategies described in these materials for particular clients or prospects.
These materials do not purport to provide any legal, tax or accounting advice.
1 The MSCI All Country World Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of
developed and emerging markets. The MSCI ACWI consists of 45 country indices comprising 24 developed and 21 emerging market country indices. The net benchmark
return is reported net of reclaimable and non-reclaimable withholding taxes. Withholding tax rates used for the benchmark differ from, and may be higher than, the
withholding tax rates used when calculating the composite return. Index returns are not covered by the report of the independent verifier. The financial indices referenced
herein are provided for informational purposes only. When comparing the performance of a manager to its benchmark(s), please note that the manager's holdings and
portfolio characteristics may differ from those of the benchmark(s). Additional factors impacting the performance displayed herein may include portfolio-rebalancing, the
timing of cash flows, and differences in volatility, none of which impact the performance of the financial indices. Financial indices are unmanaged and assume
reinvestment of dividends but do not reflect the impact of fees, applicable taxes or trading costs which may also reduce the returns shown. All indices referenced in this
presentation are registered trade names or trademark/service marks of third parties. References to such trade names or trademark/service marks and data is proprietary
and confidential and cannot be redistributed without Jennison's prior consent. Investors cannot directly invest in an index.
2 MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of
any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain
from making) any kind of investment decision and may not be relied on as such. Historical data and analysis should not be taken as an indication or guarantee of any
future performance analysis, forecast or prediction. The MSCI information is provided on an as is basis and the user of this information assumes the entire risk of any
use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information
(collectively, the MSCI Parties) expressly disclaims all warranties (including, without limitation, any warranties of originality, accuracy, completeness, timeliness, noninfringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI
Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages.
3 Certain third party information in this document has been obtained from sources that Jennison believes to be reliable as of the date presented; however, Jennison cannot
guarantee the accuracy of such information, assure its completeness, or warrant such information will not be changed. The information contained herein is current as of
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information; nor do we make any express or implied warranties or representations as to the completeness or accuracy of the third party information.
4 Total Return is the price change of a security or group including dividends accrued over the report period or the "in-portfolio return" which includes only the time period
that each security was in the portfolio.
5 The Global Industry Classification Standard (GICS) was developed by and is the exclusive property and a service mark of MSCI, Inc. (MSCI) and Standard & Poors
Financial Services LLC (S&P) and is licensed for use by Jennison Associates LLC as is. As of October 1, 2009, Jennison Associates LLC (Jennison) does not
reclassify securities classified by S&P/MSCI GICS. Only securities not classified by S&P/MSCI GICS will be classified by Jennison. Therefore, this report may include
companies that have been classified by S&P/MSCI GICS or classified by Jennison. Companies classified by Jennison are not sponsored by the S&P/MSCI GICS
classification system.
6 The views expressed herein are those of Jennison investment professionals at the time the comments were made. They may not be reflective of their current opinions, are
subject to change without prior notice, and should not be considered investment advice.

For investment professional use only.