Sie sind auf Seite 1von 21

April 9, 2010

United States: Portfolio Strategy

US Weekly Kickstart
S&P 500 closes at YTD high ahead of 1Q 2010 earnings season that commences next week
S&P 500 has returned 7% YTD but most investors trail the index. Hedge funds have
suffered from short positions and returned 2% in 1Q. Core mutual funds returned 5%
reflecting underweight positions in Consumer Discretionary which surged 14% in
two months, twice the market rebound. We include text from Michael Moran’s note
on tax write-offs from health care reform and its implications for corporate behavior.

Performance Sector views and performance


David J. Kostin
The S&P 500 was up 0.8%. Healthcare (-1.1%) and Our recommended sector weightings have
(212) 902-6781 david.kostin@gs.com
Consumer Staples (-0.9%) underperformed while generated +4 bp of alpha YTD. Our overweight Goldman Sachs & Co.
Financials was the best sector, up 2.4%. We recommendations (Energy, Materials, Info Tech)
Nicole Fox
expect the S&P 500 to rise to 1300 by mid-year have generated -22 bp of alpha while our
(212) 357-1744 nicole.fox@gs.com
(+10%), before ending 2010 at 1250 (+5%). underweight positions (Health Care, Consumer Goldman Sachs & Co.
Staples, Utilities, Telecom.) have generated +26
S&P 500 Earnings bp of alpha. Caesar Maasry
Our top-down EPS forecasts of $76 and $90 for (212) 902-9693 caesar.maasry@gs.com
Goldman Sachs & Co.
2010 and 2011 reflect +33% and +20% growth, US Portfolio Strategy baskets
respectively. Our pre-provision and write-down Our recommended High Sharpe Ratio trade (Long Amanda Sneider
EPS forecasts are $81 for 2010 and $91 for 2011. <GSTHSHRP> / Short S&P 500) was up 0.4% for (212) 357-9860 amanda.sneider@gs.com
Goldman Sachs & Co.
Bottom-up consensus forecasts a 38% increase in the week. Our recommended Operating Leverage
2010 to $78, and a 21% increase in 2011 to $95. trade was up 0.5% (Long <GSTHOPHI> / Short
<GSTHOPLO>).
Valuation
Top-down the S&P 500 trades at an NTM P/E of S&P 500 stock performance this week
15.7X (14.7X on pre-provision EPS). Bottom-up, it Leaders: EK, HOG, EOG, WYNN, RF
trades at an NTM P/E of 15.1X and LTM P/B of Laggards: MEE, FRX, TSO, MWW, JCP
2.5X.

The Goldman Sachs Group, Inc. does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that
could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification, see the end of the text. Other
important disclosures follow the Reg AC certification, or go to www.gs.com/research/hedge.html. Analysts employed by non-US affiliates are not registered/qualified as research analysts with FINRA in
the U.S.

The Goldman Sachs Group, Inc. Goldman Sachs Global Economics, Commodities and Strategy Research
April 9, 2010 United States: Portfolio Strategy

Conversations we are having with clients: Cyclical positioning and health care tax charges
Clients continue to express optimism regarding the trajectory of US “Sizable tax charges from health care legislation
economic activity and corporate profits heading into 1Q earnings
The federal subsidy that some companies receive for providing qualifying
season. However, many investors – including nearly all hedge funds –
prescription drug coverage to retirees will no longer be tax deductible under
express grave concerns regarding the long-term fiscal position of the US
the new health care legislation. This change will require some companies to
and its implications for interest rates and stock prices. But in the short-term
write off a portion of their deferred tax assets related to retiree health care
they remain bullish and most are fully invested and cyclically positioned.
obligations. In accordance with US GAAP accounting rules, the deferred tax
Most investors lagged the 5.4% total return of the S&P 500 in 1Q. Equity asset must be adjusted in the period of enactment for the effect of an
long/short hedge funds returned roughly 2% while large-cap core mutual enacted change in tax law or rates.
fund managers returned an average of 4.6%.
Subsidy still exists, but tax deduction is limited
Clients we visited this week in Boston were generally receptive to our
Legislation introduced in 2003 provided companies with a 28% tax-free
preference for global cyclical vs. domestic cyclical exposure. However,
federal subsidy if they offered retiree prescription drug coverage that is at
investors expressed frustration that they had missed the rally in Consumer
least actuarially equivalent to Medicare Part D coverage. Even though a
Discretionary stocks which have surged 14% since the market low in early
portion of their cost was offset by the subsidy, employers were still allowed
February compared with 7% for the S&P 500. Consumer Discretionary bulls
to claim a deduction for the entire cost of providing the prescription drug
pointed to recent better-than-expected consumer data and positive earnings
coverage.
revisions. We, along with the Consumer Discretionary bears, argue that
share prices in the sector already reflect the improved economic data. For example, if a company provided $100 of qualifying prescription drug
coverage, it was eligible for a tax-free $28 subsidy. Nonetheless, it was still
We expect global cyclicals will lead S&P 500 towards 1300 as investors
eligible to deduct the full $100 cost of the benefit. Under the new legislation
re-focus on better growth prospects abroad. A revaluation of the CNY
the amount eligible for deduction would be $28 lower, or $72. As the
may help to expedite this shift, in our view. See our note US Sector Views:
amount expected to be deducted in the future will now be lower, the
Global vs. Domestic tug-of-war within the US equity market (March 25).
deferred tax asset related to the deduction will need to be lowered.

Back-of-the-envelope approach to assess materiality


Market implications of the recent health care legislation
The impact of this aspect of the new health care legislation will only be felt
Passage of health care reform removed some of the uncertainty surrounding
by companies that receive the federal subsidy. In other words, if a company
health care stocks. However, the magnitude of deferred tax write-offs for
provides retiree health care benefits but does not receive the subsidy, then
some firms surprised many investors and prompted several client inquiries.
its existing deferred tax assets will be unaffected and no charge should be
Our colleague Michael Moran from the Goldman Sachs Global Market forthcoming.
Institute (GMI) authored a recent note explaining the tax charges and
Companies are required to disclose their anticipated benefit payments for
the implications on corporate behavior of the new health care
retiree health care obligations as well as subsidies they expect to receive
legislation.
from the federal government. Investors can use this information to assess
We publish below the text from the note Tax Time: Plenty of charges how material a charge to deferred tax assets may be for companies affected
from the health care bill, but changes in corporate behavior loom by the change.
(March 30). The full note contains a list of S&P 500 stocks with significant
For example, Caterpillar disclosed in its 2009 10-K that over the next ten
retiree health care obligations.
years it expects to pay out about $3.9 billion in retiree health care benefits
and receive $240 million in subsidies. In other words, about 6.1% of its

Goldman Sachs Global Economics, Commodities and Strategy Research 2


United States: Portfolio Strategy

payments are being subsidized. If we gross up CAT’s reported retiree health that treatment was accepted by investors. We suspect similar scenarios will
care obligation ($4.5 billion) to account for the roughly 6.1% subsidy, the play out with these tax charges.
pre-subsidy obligation is about $4.8 billion. This implies that there are $300
Second, these charges are non-cash in nature. Investors focusing on cash-
million of subsidies that will not be tax deductible in the future. Applying a
flow and/or using pseudo-cash-EPS metrics will look past these charges.
35% tax rate means that about $105 million of deferred tax assets would
have to be written off. Caterpillar had announced that its tax-related charge Finally, many companies are indicating that the legislation is leading them
would be about $100 million. to revisit the health care benefits they provide their employees and retirees.
In other words, corporate behavior with respect to benefit offerings could
This is, admittedly, a back-of-the-envelope calculation. Actual calculations
change as a result of the new legislation. It was interesting to note in AT&T’s
required to be performed by companies will be much more involved. Even
8-K filed with the SEC on March 26, 2010, in which it disclosed its $1 billion
some companies have indicated that they are still trying to figure out the
charge related to the elimination of the tax deduction for the federal subsidy,
impact of the legislation on their deferred tax assets. Nonetheless, it
that the company devoted one of the four sentences in the filing to note that
provides a quick and simple way for investors or other users of financial
“As a result of this legislation, including the additional tax burden, AT&T will
information to assess the potential materiality of these charges.
be evaluating prospective changes to the active and retiree health care
Largest charges to be concentrated in a handful of companies benefits offered by the company.”

Sizable retiree health care obligations are concentrated in a handful of Some investors may be focused on the potential for employers to reduce
companies and industries. As of the end of 2009, 55 companies in the S&P their health care expenses as a result of the new legislation. How
500 accounted for over 75% of the total amount of retiree health care companies potentially adjust health care benefits being offered to
obligations for all companies in the index and almost half of the total current employees and retirees as a result of the new legislation is
reported obligations were concentrated in just two sectors – still to be seen. However, the comments of some companies seem to
Telecommunication Services and Industrials. indicate that changes are at least being contemplated.

Identifying the population of companies requiring further analysis Reducing or eliminating retiree health care benefits is nothing new for the
corporate sector. US companies have been enacting such changes for the
As noted previously, it is the receipt of the federal subsidy related to this
past several decades. As we noted earlier, however, many of the largest
obligation that will no longer be deductible and which is leading to tax
retiree health care plans today are found in highly unionized companies
charges in the current period. As investors consider where the largest
whose corporate managements cannot unilaterally change the benefits. We
charges will be found, a natural starting point would be with the companies
shall see how employers proceed with any potential efforts to modify these
that have the largest absolute reported obligations.
benefits going forward.
What’s next? Employer response still to come
Don’t forget about public sector employers too
The sizable tax-related charges already reported by some companies have
Finally, we note that potential changes in behavior extend beyond corporate
generally been treated with indifference by investors. Indeed, some firms
employers to state and local governments, despite the fact that they do not
that have announced these charges have seen their share prices rise after
share the same tax impact from the legislation as do their corporate
the announcement. There can be several possible explanations for this.
counterparts. Many governments have sizable retiree health care obligations
First, investors sometimes view tax-related charges as one-time, non- that in recent years have become more transparent with the implementation
operational in nature. Consequently, they (and companies) tend to add these of a new governmental accounting standard, GASB 45. Public sector
incremental expenses back when deriving pro forma earnings. For historical employees tend to be more unionized and have more generous benefit
perspective consider the sizable tax-related charges that many companies packages than their private sector counterparts, further enhancing the size of
booked in 2005 when offered the opportunity to repatriate foreign profits at these liabilities. Any potential changes in employer behavior with respect to
a favorable tax rate under the American Jobs Creation Act of 2004. Many of health care benefits are unlikely to be confined only to private sector
these charges were added back to pro forma earnings by companies and employers.”

al Economics, Commodities and Strategy Research 3


April 9, 2010 United States: Portfolio Strategy

1Q 2010 Earnings Calendar (week of April 12, 2010)


Exhibit 1: 1Q 2010 Earnings Calendar
YTD Mkt Cap 1Q 2010 EPS Consensus 1Q 2010 P/E
Sector Company name Ticker Rating Return ($ bil) GS Consensus Std. Dev. YTD Revisions Yr/Yr Growth (NTM)
Monday, April 12, 2010
Materials Alcoa Inc AA Neutral (8)% $ 15 $ 0.08 $ 0.11 $ 0.05 (46)% 119 % 20.0 x
Tuesday, April 13, 2010
Industrials CSX Corp. CSX Sell 10 % $ 21 $ 0.62 $ 0.69 $ 0.05 0% 11 % 16.4 x
Fastnal Co. FAST NC 23 7 0.33 0.01 1 0 33.9
Information Technology Intel Corp. INTC Neutral 10 % $ 123 $ 0.37 $ 0.37 $ 0.02 10 % 236 % 13.6 x
Linear Technology Corp. LLTC Buy (6) 6 0.37 0.39 0.02 19 56 17.6
Wednesday, April 14, 2010
Consumer Discretionary Yum! Brands, Inc YUM Buy 15 % $ 19 $ 0.48 $ 0.52 $ 0.02 (1)% 8% 16.7 x
Financials JPMorgan Chase & Co. JPM Buy* 10 % $ 182 $ 0.70 $ 0.64 $ 0.06 (2)% 60 % 15.0 x
Industrials Grainger (W.W.) Inc. GWW Neutral 18 % $7 $ 1.52 $ 1.37 $ 0.06 6% 10 % 19.1 x
Thursday, April 15, 2010
Financials People's United Financial PBCT Neutral (0)% $6 $ 0.08 $ 0.08 $ 0.01 (18)% 0% 43.3 x
Progressive Corp. PGR Buy 9 13 0.36 0.37 0.03 0 (12) 13.6
Health Care Intuitive Surgical ISRG NC 12 % $ 13 $ 1.68 $ 0.15 11 % 133 % 43.8 x
Information Technology Advanced Micro Devices AMD Sell (3)% $5 $(0.16) $(0.11) $ 0.08 44 % 83 % NM
Google Inc. GOOG Buy* (8) 137 6.87 6.56 0.20 3 27 20.8
Materials PPG Industries PPG Neutral 17 % $ 11 $ 0.70 $ 0.64 $ 0.07 21 % 237 % 17.5 x
Friday, April 16, 2010
Consumer Discretionary Gannett Co. GCI NC 20 % $4 $ 0.42 $ 0.05 24 % 68 % 8.6 x
Genuine Parts GPC Buy* 14 7 0.67 0.61 0.02 3 9 16.1
Mattel, Inc. MAT NC 18 9 (0.03) 0.03 29 79 14.4
Financials Bank of America Corp. BAC Buy* 24 % $ 187 $ 0.10 $ 0.09 $ 0.07 35 % (80)% 23.5 x
First Horizon National FHN Neutral 13 3 (0.10) (0.16) 0.06 (33) 56 NM
Charles Schwab SCHW Neutral 2 19 0.11 0.13 0.02 (24) (32) 27.5
Industrials General Electric GE Buy 23 % $ 198 $ 0.13 $ 0.17 $ 0.02 11 % (35)% 18.5 x

Source: Factset, Bloomberg and Goldman Sachs Global ECS Research.

 * - Conviction list.

Goldman Sachs Global Economics, Commodities and Strategy Research 4


April 9, 2010 United States: Portfolio Strategy

S&P 500 Performance


Exhibit 2: S&P 500 sector performance over the last week Exhibit 3: S&P 500 price return and daily trading volume LTM
as of April 8, 2010 as of April 8, 2010
1,500 9
Financials 2.4
1,400 S&P 500 daily price level (lhs) 8
Cons Discretionary 1.9
1,300 7

Shares traded (billions)


Energy 1.3

S&P 500 Price Level


1,200 6
Materials 1.0
1,100 5
Information Tech 1.0
1,000 4
S&P 500 0.8
900 3
Industrials 0.5
800 2
Telecom Services 0.2
700 1
Utilities (0.0) S&P 500 daily trading volume (rhs)
600 0
Consumer Staples (0.9)

8-Apr-08

8-Oct-08

8-Apr-09

8-Oct-09

8-Apr-10
8-Jun-08

8-Aug-08

8-Dec-08

8-Jun-09

8-Aug-09

8-Dec-09
8-Feb-09

8-Feb-10
Health Care (1.1)
(2.0) (1.0) 0.0 1.0 2.0 3.0
1-week Total Return (%)

Source: FactSet, and Goldman Sachs Global ECS Research. Source: FactSet, and Goldman Sachs Global ECS Research.

Exhibit 4: S&P 500 sector performance over time Exhibit 5: BEST and WORST performing S&P 500 STOCKS BY SECTOR
as of April 8, 2010 as of April 8, 2010
Total Return Percentage Change (%) BEST STOCKS WORST STOCKS
1-Week 1-Month 3-Month 6-Month YTD 12-Month Return (%) Return (%)
Financials 2% 8% 8% 10 % 15 % 81 % Sector Ticker 1-week YTD Ticker 1-week YTD

Industrials 1 7 9 21 14 66 Cons Discr EK 28 % 82 % JCP (5)% 18 %


Consumer Staples DF 4 (8) ADM (4) (10)
Cons Discretionary 2 6 11 22 13 62
Energy EOG 12 10 MEE (13) 10
Materials 1 5 0 12 6 55
Financials RF 11 63 ICE (5) (5)
Consumer Staples (1) 2 5 9 5 32
Health Care KG 3 (1) FRX (11) (13)
Energy 1 3 (1) 5 4 29
Industrials R 7 2 IRM (3) 17
Information Tech 1 4 2 14 3 52
Info Tech ADSK 7 22 MWW (6) (9)
Health Care (1) 1 1 13 3 35 IP MON
Materials 9 3 (2) (15)
Utilities (0) 1 (1) 6 (2) 20 Telecom Services Q 4 31 VZ (2) (6)
Telecom Services 0 5 (2) 6 (3) 9 Utilities EQT 3 (1) AEP (2) (1)
S&P 500 1% 4% 4% 12 % 7% 47 % S&P 500 EK 28 % 82 % MEE (13)% 10 %

Source: FactSet, and Goldman Sachs Global ECS Research. Source: FactSet, and Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 5


April 9, 2010 United States: Portfolio Strategy

S&P 500 Performance (cont’d)


Exhibit 6: TOP 10 performing SUB-SECTORS over the last week Exhibit 7: BOTTOM 10 performing SUB-SECTORS over the last week
as of April 8, 2010 as of April 8, 2010

Photographic Products 28 Property & Casualty Insurance (2)


Motorcycle Manufacturers 12 Soft Drinks (2)
Casinos & Gaming 9 Homebuilding (2)
Trucking 7 Electronic Components (2)
Paper Products 6 Construction Materials (2)
Regional Banks 6 Fertilizers & Agricultural Chemicals (2)
Internet Retail 5 Managed Health Care (2)
Homefurnishing Retail 5 Diversified Support Services (2)
Investment Banking & Brokerage 5
Agricultural Products (4)
Commercial Printing 5
Auto Parts & Equipment (4)
0 5 10 15 20 25 30
1-week Total Return (%) (5) (4) (3) (2) (1) 0
1-week Total Return (%)

Source: FactSet, and Goldman Sachs Global ECS Research. Source: FactSet, and Goldman Sachs Global ECS Research.

Exhibit 8: TOP 10 performing S&P 500 STOCKS over the last week Exhibit 9: BOTTOM 10 performing S&P 500 STOCKS over the last week
as of April 8, 2010 as of April 8, 2010
Return (%) Return (%)
Company Name Ticker Sector 1-week YTD Company Name Ticker Sector 1-week YTD
Eastman Kodak EK Cons Discr 28 82 Massey Energy Co. MEE Energy (13) 10
Harley-Davidson HOG Cons Discr 12 27 Forest Laboratories FRX Health Care (11) (13)
EOG Resources EOG Energy 12 10 Tesoro Corp. TSO Energy (8) (2)
Wynn Resorts WYNN Cons Discr 11 48 Monster Worldwide MWW Info Tech (6) (9)
Regions Financial Corp. RF Financials 11 63 Penney (J.C.) JCP Cons Discr (5) 18
American Int'l. Group AIG Financials 10 25 IntercontinentalExchange Inc. ICE Financials (5) (5)
Washington Post WPO Cons Discr 10 12 WellPoint Inc. WLP Health Care (4) 7
Zions Bancorp ZION Financials 10 87 D. R. Horton DHI Cons Discr (4) 11
Huntington Bancshares HBAN Financials 9 62 Johnson Controls JCI Cons Discr (4) 18
International Paper IP Materials 9 3 Aetna Inc. AET Health Care (4) 6
S&P 500 Average 1 10 S&P 500 Average 1 10

Source: FactSet, and Goldman Sachs Global ECS Research. Source: FactSet, and Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 6


April 9, 2010 United States: Portfolio Strategy

Earnings and Sales


Exhibit 10: EARNINGS GROWTH: S&P 500 bottom-up consensus estimates Exhibit 11: SALES GROWTH: S&P 500 bottom-up consensus estimates
as of April 8, 2010 as of April 8, 2010
2010E Earnings Per Share Growth Annual 2010E Sales Per Share Growth Annual
1QE 2QE 3QE 4QE 2010E 2011E 1QE 2QE 3QE 4QE 2010E 2011E
Financials 548 256 181 171 232 49 Energy 38 33 27 24 30 13
Energy 1492 68 40 42 86 27 Materials 15 20 7 7 12 7
Materials 164 107 30 33 68 29 Information Technology 9 12 9 5 9 7
Consumer Discretionary 795 37 15 7 44 18 S&P 500 5 8 7 6 7 7
Information Technology 82 57 36 11 39 14 Health Care 2 3 0 4 2 4
S&P 500 70 37 29 27 38 21 Consumer Staples 1 2 2 3 2 5
Utilities 8 9 6 24 11 4 Consumer Discretionary (5) 3 3 1 0 6
Health Care (4) 4 4 25 7 10 (1)
Industrials (6) (2) 4 2 5
Consumer Staples 7 4 4 4 5 10
Telecom Services (3) (3) (2) (1) (2) 1
Industrials (4) (3) 22 4 4 18
Telecom Services (11) (6) 3 12 (1) 10

S&P 500 (ex-Financials) 52 24 18 16 25 16

Source: FactSet, and Goldman Sachs Global ECS Research. Source: FactSet, and Goldman Sachs Global ECS Research.

Exhibit 12: TOP-DOWN vs. BOTTOM-UP: Goldman Sachs vs. Consensus Exhibit 13: REVISIONS: S&P 500 consensus EPS revisions
as of April 8, 2010 as of April 8, 2010
Contribution to EPS Annual earnings growth rates
80
GS Top-Down EPS Bottom-up GS Top-Down Bottom-Up
2010E 2011E 2010E 2011E 2010E 2011E 2010E 2011E
S&P 500 2010E EPS
Energy $10 $15 $10 $12 93 % 45 % 86 % 27 % 79 Consensus
Materials 2 3 2 3 69 15 68 29 Bottom-Up
Telecom Services 3 3 2 2 32 1 (1) 10 $78
Consumer Discretionary 5 5 7 8 5 5 44 18 78
Utilities 3 4 3 4 15 1 11 4
Information Technology 11 12 14 16 7 10 39 14
Industrials 7 8 7 8 6 16 4 18
77
Health Care 12 13 12 13 10 4 7 10
Consumer Staples 9 9 9 10 4 3 5 10
76 Goldman
S&P 500 ex-Financials 63 71 67 77 18 13 25 16 Sachs
Financials Operating EPS 12 19 12 17 251 54 232 49 $76
S&P 500 Operating EPS $76 $90 $78 $95 33 % 20 % 38 % 21 % 75
+ Provisions & Writedowns 5 1 NA NA (63) (82) NA NA
31-Jan
31-Dec

28-Feb

31-Mar

30-Apr
S&P 500 EPS ex-P&W 81 91 NA NA 13 13 NA NA

Source: FactSet, and Goldman Sachs Global ECS Research. Source: FactSet, and Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 7


April 9, 2010 United States: Portfolio Strategy

Revisions
Exhibit 14: EARNINGS and SALES REVISIONS Exhibit 15: Stocks with the most POSITIVE and NEGATIVE EPS REVISIONS
Aggregate dollars % change, as of April 8, 2010 as of April 8, 2010

EPS REVISIONS SALES REVISIONS POSITIVE EPS REVISIONS NEGATIVE EPS REVISIONS
1 month 3 month 1 month 3 month 1 month 3 month 1 month 3 month
10E 11E 10E 11E 10E 11E 10E 11E Ticker Revis. Return Revis. Return Ticker Revis. Return Revis. Return
Information Technology 1.1 % 1.2 % 8.9 % 7.7 % 0.8 % 0.9 % 5.8 % 6.4 % MU 55 % DFS (27)%
10 % 68 % (5)% 9% (30)% 3%
Consumer Discretionary 0.7 0.9 6.7 4.3 (0.2) 0.8 1.4 1.8
LEN 55 0 69 8 HIG (24) 6 (19) 9
Industrials 0.4 0.9 2.8 3.3 0.3 0.2 1.0 1.6
CMA 29 13 65 26 GT (23) (5) (61) (19)
Materials 0.2 (0.3) 3.8 2.7 0.6 0.1 4.3 2.9
AMD 27 9 70 (0) ETFC (22) 2 (389) (6)
Health Care (0.1) (0.1) (0.6) (0.6) 0.1 (0.1) 1.0 0.8
Telecommunication Services (0.1) 0.0 (4.7) (5.8) 0.0 (0.1) 0.1 (0.2) CLF 26 22 100 38 C (20) 26 (61) 25
Consumer Staples (0.1) (0.0) 0.0 (0.1) 0.2 (0.3) 0.8 1.0 DHI 18 (7) NM (1) COG (18) (7) (16) (16)
Utilities (0.3) (0.5) (1.7) (2.6) NM NM NM NM NSM 13 (1) 14 (4) SUN (16) 5 (39) 4
S&P 500 (0.3) (0.1) 1.6 1.0 0.5 0.4 2.0 0.4 X 11 9 (63) 1 XL (16) (0) (11) 6
Financials (1.8) (0.8) (2.4) (1.7) NM NM NM NM ODP 11 5 67 15 APC (14) 3 9 9
Energy (2.6) (2.1) (1.3) (2.3) 1.9 1.1 2.6 (5.7) WYNN 9 25 24 27 RRC (12) (4) (8) (10)
S&P 500 (0)% 4% 2% 4% (0)% 4% 2% 4%

Source: FirstCall, I/B/E/S, FactSet, and Goldman Sachs Global ECS Research. Source: FirstCall, I/B/E/S, FactSet, and Goldman Sachs Global ECS Research.

Exhibit 16: S&P 500 1-Month Earnings Revisions Sentiment Exhibit 17: 1-Month Earnings Revision Sentiment by SECTOR
as of April 8, 2010 as of April 8, 2010

25 %
60% 30 %
20 % 1-Month Earnings Revision Sentiment by Sector
S&P 500 1-Month 2010 EPS Revision Sentiment (lhs)
[(# pos. revisions - # neg. revisions)/ total revisions]
40% [(# pos. revisions - # neg. revisions)/ total revisions] 20 % 15 %
1-Month Revision Sentiment

S&P 500 Monthly % Return


10 %

Earnings Sentiment
20% 10 % 5%

0%
0% 0%
(5)%

(10)%
(20)% (10)%
(15)%
Price Performance (rhs)
(20)%
(40)% (20)%

Materials

S&P 500
Info Tech

Energy
Telecom Services
Health Care

Utilities
Consumer Discr

Consumer Staples
Industrials

Financials
(60)% (30)%
Dec-05

Dec-06

Dec-07

Dec-08

Dec-09
Jun-06

Jun-07

Jun-08

Jun-09

Jun-10

Source: FirstCall, I/B/E/S, FactSet, and Goldman Sachs Global ECS Research. Source: FirstCall, I/B/E/S, FactSet, and Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 8


April 9, 2010 United States: Portfolio Strategy

Valuation
Exhibit 18: Aggregate valuation metrics for S&P 500 and sectors Exhibit 19: Standard deviation vs. 10-year history (Z-Score)
bottom-up consensus valuation, as of April 8, 2010 bottom-up consensus, as of April 8, 2010
EV/ EV/ Price/ FCF PEG NTM EV/ EV/ Price/ FCF PEG Median
Sales EBITDA Book Yield Ratio P/E Sales EBITDA Book Yield P/E Ratio Z-Score

S&P 500 1.5x 8.8x 2.5x 6.2 % 1.4x 15.1x S&P 500 (0.8) (0.9) (0.8) (1.3) (0.7) 0.7 (0.8)

Materials 1.5 10.5 3.0 4.9 1.8 17.9 Health Care (1.7) (1.6) (1.1) (0.7) (1.7) (0.5) (1.3)

Industrials 1.9 11.7 3.0 7.1 1.7 17.7 Consumer Staples 1.0 (0.3) (0.7) (0.1) (0.8) (1.1) (0.5)

Consumer Discretionary 1.3 8.4 2.9 8.2 1.2 16.9 Telecommunication Services (1.2) (0.8) (0.1) (0.8) (0.1) 1.4 (0.5)

Financials NM NM 1.4 NM 2.0 16.8 Information Technology 0.1 (0.9) 0.9 (0.0) (1.3) (1.2) (0.4)

Information Technology 2.3 10.5 4.2 6.3 1.1 15.5 Utilities NM (0.5) (0.1) NM 0.1 1.3 (0.0)

Telecommunication Services 1.8 5.3 1.7 13.3 3.1 14.8 Consumer Discretionary 2.3 0.4 2.6 (1.4) (0.2) (0.7) 0.1
Energy (0.3) 1.6 (0.4) 1.3 1.2 (0.5) 0.4
Consumer Staples 1.2 9.2 3.7 6.4 1.6 14.7
Materials 1.1 0.8 1.5 0.6 0.7 0.1 0.8
Energy 1.0 7.8 2.2 1.2 1.0 13.4
Industrials 0.8 1.2 1.5 0.7 2.1 2.1 1.3
Health Care 1.2 8.2 2.9 7.7 1.3 12.1
Financials NM NM (1.0) NM 1.3 2.2 1.3
Utilities NM 7.0 1.5 2.8 2.8 12.1
Source: Compustat, FirstCall via FactSet, and Goldman Sachs Global ECS Research. Source: Compustat, FirstCall via FactSet, and Goldman Sachs Global ECS Research.

Exhibit 20: Historical NTM P/E and LTM P/B values for the S&P 500 Exhibit 21: Top stocks by fastest 2010 earnings growth and lowest NTM P/E
aggregate bottom-up consensus valuation, as of April 8, 2010 by sector, as of April 8, 2010
GROWTH VALUE
6 Fastest EPS Growth (%) Lowest P/E (x)
5 P/B Sector Ticker 2010E 2011E Ticker NTM Rel to SPX
2.5
LTM P/B (x)

4
3 Cons Discr CBS 88 20 GCI 8.6 0.6
2
10-yr rolling avg Consumer Staples WFMI 63 13 SVU 8.4 0.6
1
0 Energy HES 82 35 CHK 8.3 0.6
1/76 1/79 1/82 1/85 1/88 1/91 1/94 1/97 1/00 1/03 1/06 1/09
Financials HIG 78 38 AIG 8.2 0.5

30 Health Care ESRX 38 27 FRX 7.7 0.5


25 P/E Industrials RHI 85 NM PBI 10.3 0.7
NTM P/E (x)

15.1
20
15 Info Tech ALTR 92 7 WDC 6.5 0.4
10 10-yr rolling avg Materials IP 68 40 FCX 11.0 0.7
5
0 Telecom Services FTR 59 1 CTL 11.1 0.7
1/76 1/79 1/82 1/85 1/88 1/91 1/94 1/97 1/00 1/03 1/06 1/09 Utilities PPL 70 (4) PPL 8.2 0.5

Source: Compustat, FactSet, and Goldman Sachs Global ECS Research. Source: Compustat, FactSet, and Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 9


April 9, 2010 United States: Portfolio Strategy

S&P 500 Factor Performance


Exhibit 22: S&P 500 factor return ranking for the week ended April 8, 2010 (a)
Last Week Spread (%) Performance Spread of Top Quintile Less Bottom Quintile (%)
Last Last Five Trading Days Last Last
(b) (1) 0 1 2
Growth Metrics Week 2-Apr 5-Apr 6-Apr 7-Apr 8-Apr Month Quarter
EPS Growth 1.8 0.0 0.8 0.5 (0.1) 0.6 2.0 3.2
GROWTH 1.1 0.0 0.7 0.4 (0.3) 0.3 1.2 3.1
EBITDA Growth 1.1 (0.1) 0.6 0.6 (0.2) 0.2 1.5 2.3
Sales Growth 0.4 (0.2) 0.5 0.3 (0.3) 0.1 0.7 (0.3)

Value Metrics (b)


EV/FCF 1.4 0.5 0.1 0.9 (0.6) 0.5 0.6 2.8
VALUATION 1.1 (0.5) 0.1 0.8 (0.0) 0.8 2.7 10.1
P/E 1.1 (0.2) 0.3 0.5 (0.2) 0.6 3.3 9.1
P/B 0.9 (0.7) (0.1) (0.1) 0.8 0.9 2.9 9.8
P/div 0.6 (0.1) 0.7 (0.2) 0.2 0.1 0.8 0.9
EV/EBITDA 0.2 (0.7) 0.0 0.6 (0.2) 0.5 2.5 7.6
EV/DACF 0.1 (0.7) (0.2) 0.7 0.0 0.3 2.7 6.4

Profitability Metrics(b)
CROCI (0.1) (0.5) 0.0 (0.6) 0.8 0.1 0.4 0.9
PROFITABILITY (0.4) (0.8) 0.1 (0.8) 1.2 (0.1) (0.6) 1.3
ROCE (0.4) (0.8) 0.3 (0.7) 0.8 (0.1) (0.0) 2.3
ROE (0.7) (0.6) (0.4) (0.9) 1.0 0.3 (0.3) 1.2

Other Metrics (c)


Short Interest Level 1.7 0.0 1.3 0.5 0.1 (0.3) 3.7 6.3
Equity Capitalization (0.4) 0.0 (0.8) (0.3) 0.3 0.5 (0.8) (1.9)
(a) Factor return analysis uses S&P 500 companies included in the Goldman Sachs Americas coverage universe with stock prices greater than $5 at the time of publication.
(b) Growth, Value and Profitability analysis is based on Goldman Sachs Investment Profile scores (“IP Scores”). Growth, value and profitability metrics are indexed based on composites of several methodologies to
determine the stocks percentile ranking within the region’s coverage universe. The precise calculation of each metric may vary depending on the fiscal year, industry and region but the standard approach is as
follows: Growth is a composite of next year’s estimate over current year’s estimate, e.g. EPS, EBITDA, Revenue. Return is a year one prospective aggregate of various return on capital measures, e.g. CROCI,
ROACE, and ROE. Multiple is a composite of one-year forward valuation ratios, e.g. P/E, dividend yield, EV/FCF, EV/EBITDA, EV/DACF, Price/Book.
(c) “Other metric” analysis based on current market prices and data sourced from NASDAQ and NYSE via FactSet.

Source: NASDAQ and NYSE via FactSet, IDC, and Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 10


April 9, 2010 United States: Portfolio Strategy

Style and Size


Exhibit 23: Total return by style and size over time Exhibit 24: Total return by SECTOR for S&P 500 vs. Russell 2000
as of April 8, 2010 as of April 8, 2010

Total Return Percentage Change (%) Weight (%) 1-Week (% Return) YTD (% Return)
Sector SP500 R2000 SP500 R2000 ∆ (bps) SP500 R2000 ∆ (bps)
1-Week 1-Month 3-Month 6-Month YTD
Telecom Services 3 1 0 (0) 36 (3) (2) (87)
Large Cap vs. Small Cap Financials 17 21 2 3 (66) 15 15 (50)
S&P 500 1 4 4 12 7 Utilities 3 3 (0) 1 (97) (2) 4 (664)
Russell 2000 2 5 9 16 12 Information Tech 19 18 1 2 (118) 3 9 (604)
Industrials 10 15 1 2 (145) 14 9 535
Large vs. Small (bps) (155) (66) (476) (341) (526)
Cons Discretionary 10 15 2 3 (149) 13 23 (984)
Materials 4 5 1 3 (182) 6 11 (515)
Growth vs. Value Health Care 12 14 (1) 1 (184) 3 10 (664)
Russell 1000 Growth 0 4 4 13 6 Consumer Staples 11 3 (1) 1 (207) 5 10 (428)
Russell 1000 Value 1 5 5 13 9 Energy 11 5 1 4 (230) 4 10 (665)

Growth vs. Value (bps) (72) (172) (128) 76 (346) Index 100 100 1 2 (155) 7 12 (526)

Source: FactSet, and Goldman Sachs Global ECS Research. Source: FactSet, and Goldman Sachs Global ECS Research.

Exhibit 25: GROWTH vs. VALUE relative performance over time Exhibit 26: LARGE CAP vs. SMALL CAP relative performance over time
Russell 1000 Growth vs. Value, as of April 8, 2010 S&P 500 vs. Russell, as of April 8, 2010

105
110
Value outperforming 103 S&P 500 outperforming
101
105
99

100 97
95

95 93
91

90 89
87
Growth outperforming Russell 2000 outperforming
85 85
Jan-08

Jul-08

Sep-08

Nov-08

Jan-09

Jul-09

Sep-09

Nov-09

Jan-10
Mar-08

May-08

Mar-09

May-09

Mar-10

May-10
Mar-08

May-08

Mar-09

May-09

Mar-10

May-10
Jan-08

Jul-08

Nov-08

Jan-09

Jul-09

Nov-09

Jan-10
Sep-08

Sep-09

Source: FactSet, and Goldman Sachs Global ECS Research. Source: FactSet, and Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 11


April 9, 2010 United States: Portfolio Strategy

Global Equity Market and Mutual Fund Performance


Exhibit 27: GLOBAL EQUITY MARKET performance over the past week Exhibit 28: US EQUITY MUTUAL FUND performance vs. benchmark
as of April 8, 2010 as of April 8, 2010

Avg. Total Return (%) Stdev No. of AUM


China (MSCI China) 2
Lipper Indices 1-week YTD 1-Week YTD Funds $ bil
Mexico (Bolsa) 1
Large-Cap Core Funds 0.7 6.4 0.5 1.7 30 259
Australia (ASX 200) 1
Benchmark: S&P 500 0.8 7.0
Korea (KOSPI) 1 Out / (Underperformance) (bps) (2) (55)
U.S. (S&P 500) 1 Large-Cap Growth Funds 0.9 6.1 0.4 1.5 30 254
Japan (Nikkei) 0 Benchmark: Russell 1000 Growth 0.5 5.7
Brazil (Bovespa) 0 Out / (Underperformance) (bps) 41 37
UK (FTSE 100) (1) Large-Cap Value Funds 0.8 7.5 0.4 1.5 30 227
Spain (IBEX 35) (1) Benchmark: Russell 1000 Value 1.2 9.2
Europe (DJ Stoxx 600) (2) Out / (Underperformance) (bps) (44) (168)

Germany (Dax) (2) Small-Cap Core Funds 1.7 10.5 0.5 2.3 29 NA

France (CAC 40) (3) Benchmark: Russell 2000 2.3 12.2


Out / (Underperformance) (bps) (59) (172)
(3) (2) (1) 0 1 2 3
% Weekly price change

Source: FactSet and Goldman Sachs Global ECS Research. Source: Lipper, Factset, and Goldman Sachs Global ECS Research.

Exhibit 29: GLOBAL EQUITY MARKET performance over time Exhibit 30: International and other MUTUAL FUND performance
as of April 8, 2010 as of April 8, 2010

Price Return (%) USD Avg. Total Return (%) Stdev No. of AUM
1-Week 1-Month 3-Month 2010 YTD 2009
Lipper Indices 1-week YTD 1-week YTD Funds $ bil
Mexico (Bolsa) 1 7 6 11 52 International Equity
Korea (KOSPI) 1 5 3 7 62
Global Funds (0) 4 0.7 2.4 30 183
U.S. (S&P 500) 1 4 4 6 23
International Funds (1) 3 0.4 2.5 30 394
Japan (Nikkei) 0 2 3 6 16
European Funds (1) 1 0.5 2.9 10 19
Australia (ASX 200) 1 4 1 4 69
Emerging Market Funds 1 6 0.3 1.4 29 NA
Brazil (Bovespa) 0 5 (1) 2 144
China (MSCI China) 2 5 (0) 2 63 Real Estate and Natural Resources
UK (FTSE 100) (1) 3 (1) (0) 37 Real Estate 2 12 0.5 1.5 30 39
Europe (DJ Stoxx 600) (2) 1 (4) (2) 32 Natural Resource 1 4 0.5 1.7 9 NA
Germany (Dax) (2) 3 (5) (4) 28
Fixed Income
France (CAC 40) (3) (0) (8) (6) 26
General U.S. Government Funds Index (0) 1 0.2 0.5 29 NA
Spain (IBEX 35) (1) (2) (15) (14) 34
A Rated Bond Funds Index 0 2 0.1 1.0 29 NA
Average (0) 3 (1) 1 49 BBB Rated Funds Index 0 3 0.1 1.4 30 NA

Source: FactSet, and Goldman Sachs Global ECS Research. Source: Lipper, FactSet, and Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 12


April 9, 2010 United States: Portfolio Strategy

ETF Analysis: Composition, Valuation, Growth and Ownership


Exhibit 31: Selected ETF analysis for the week ended April 8, 2010 (a) (b)

ETF Description Composition Performance (%) Valuation Growth (%) Ownership


Market Top Stocks as Valuation Short Median
(a)
Cap No. of % of ETF Price Change P/E P/B Div Sales Growth Earnings Growth Interest Hedge Fund
(c)
Sector / sub-sector Index ETF $ mil Stocks 1 5 10 1 Wk YTD NTM LTM Yield 2010 2011 2010 2011 Days Own (%)
S&P 500 SPX SPY 77,807 500 3 11 19 1 6 15 2.4 1.9 9 7 29 20 2.1 3.0
S&P 100 OEX OEF 2,662 100 5 17 30 1 5 14 2.4 2.0 10 7 28 21 1.5 1.8
Nasdaq-100 NDX QQQQ 21,413 100 17 34 46 1 6 18 3.9 0.7 14 9 24 15 1.9 3.3
Consumer Discretionary IXY XLY 2,133 81 7 27 45 2 13 17 2.6 1.4 4 6 29 18 2.8 4.0
Homebuilders SPHOME XHB 873 25 5 22 43 1 14 46 1.8 1.0 5 11 NM 125 3.4 4.0
Retail IRH RTH 265 18 19 57 82 2 10 16 2.9 1.5 5 5 11 14 1.8 3.0
Retail SPSIRETR XRT 1,191 62 2 9 17 2 10 16 2.7 0.9 5 5 17 16 2.8 6.7
Consumer Staples IXR XLP 2,392 41 16 46 66 (1) 5 15 3.4 2.9 4 5 8 9 2.5 2.0
Energy IXE XLE 6,129 40 17 47 62 1 4 14 2.1 1.7 20 16 39 30 2.3 3.1
Clean Energy ECO PBW 671 54 3 14 27 2 (8) 49 2.1 0.5 35 26 NM 75 4.0 4.8
Natural Resources SPGSSINR IGE 1,809 131 7 29 42 2 4 16 2.1 1.4 21 15 38 30 2.3 4.1
Oil & Gas E&P SPSIOP XOP 631 33 3 17 32 1 6 19 1.9 0.8 22 15 45 41 2.5 4.6
Oil Services OXH OIH 2,154 16 15 54 83 1 6 15 2.0 0.7 4 12 (12) 25 2.6 3.7
Financials IXM XLF 7,092 79 10 42 58 2 14 17 1.3 1.0 NM NM 149 51 1.5 2.9
Banks BKX KBE 1,143 24 10 37 60 5 29 71 1.2 0.8 NM NM NM 431 1.1 3.6
Broker-Dealers DJSINV IAI 128 25 11 40 63 2 4 15 1.5 0.9 NM NM 223 27 1.7 4.0
Insurance KIX KIE 249 24 8 35 59 1 21 13 1.2 1.7 NM NM 92 48 1.7 4.2
Real Estate DJUSRE IYR 3,044 74 9 26 42 2 11 15 2.1 4.3 NM NM 0 6 4.2 2.9
Regional Banks KRX KRE 898 50 3 13 25 4 24 41 1.4 1.6 NM NM NM 159 8.0 2.7
REITs RMZ VNQ 5,890 97 9 27 43 2 12 16 2.1 3.8 NM NM (2) 6 4.3 2.6
Health Care IXV XLV 2,928 51 14 44 60 (1) 2 12 2.8 2.0 10 4 8 10 2.1 4.0
Biotech SPSIBI XBI 590 27 4 21 40 1 14 NM 5.7 0.0 16 18 23 NM 3.4 9.8
Pharmaceuticals IPH PPH 639 16 26 79 95 (1) (0) 11 3.0 3.3 17 4 8 10 2.0 3.2
Industrials IXI XLI 3,279 58 13 34 51 1 13 18 3.0 2.0 4 6 11 19 2.6 1.9
Transportation TRAN IYT 482 20 12 43 70 1 9 22 2.4 1.6 8 8 105 33 2.7 3.5
Information Technology IXT XLK 4,982 83 10 40 63 1 2 15 3.5 1.5 9 6 23 13 1.7 3.1
Semiconductors SPGSTISM IGW 277 51 8 35 54 1 1 16 3.2 1.3 28 9 189 20 2.3 3.4
Semiconductors XSH SMH 729 18 24 67 87 1 1 14 3.3 2.0 27 7 149 16 1.6 2.9
Software SPGSTISO IGV 314 50 9 36 56 1 5 18 3.6 0.3 7 9 12 15 2.1 3.5
Telecom Services DJSTELT IYZ 595 30 19 51 73 (0) 1 30 1.8 4.2 3 2 35 32 2.8 4.6
Materials IXB XLB 2,004 31 10 45 66 1 5 18 3.1 1.7 15 8 70 30 2.0 2.2
Gold Miners GDM GDX 6,029 31 16 49 72 4 4 23 2.5 0.6 26 8 54 17 1.2 4.3
Metals & Mining SPSIMM XME 973 25 4 22 43 2 15 22 2.4 0.9 23 14 NM 76 1.8 4.6
Steel STEEL SLX 443 27 12 46 69 1 15 20 2.0 0.9 30 19 395 53 1.9 1.9
Utilities IXU XLU 3,347 36 8 33 54 (0) (3) 12 1.5 4.4 NM NM 2 5 2.8 2.0
(a) Performance of the underlying index.
(b) Valuation, growth and ownership metrics are bottom-up aggregations of consensus forecasts, except where noted.
(c) Hedge Fund ownership data based on 4Q 2009 13-F filings.

Source: Compustat, First Call, Lionshare via Factset, IDC, and Goldman Sachs Global ECS Research. See our Goldman Sachs ETF Bloomberg page <GETFG> or contact the desk at 1-888-ETF-DESK for more information.

Goldman Sachs Global Economics, Commodities and Strategy Research 13


April 9, 2010 United States: Portfolio Strategy

Fund Flows
Exhibit 32: Domestic equity mutual fund flows, 4-week moving average Exhibit 33: Weekly mutual fund flows and assets tracked by AMG
week ended April 7, 2010 Week ended April 7, 2010; excluding ETFs

10.0 AMG Weekly Mutual Fund Flows, ex-ETFs ($ billions)


Domestic Equities, 4-week moving avg Total AMG Weekly Flows 1-Week Flow Inflow/(Outflow)
8.0
Assets 4-Week Avg This week % of Assets (Cons. Weeks)
6.0
All Equity 1,745 0.9 1.2 0.1 % 7
4.0
U.S. Equity 1,311 0.5 0.6 0.0 2
2.0
$ billions

Int'l Equity 311 0.3 0.5 0.2 1


0.0
Global 123 0.0 0.0 0.0 2
(2.0)
(4.0) Equity Income 79 0.1 0.3 0.4 7

(6.0) Gold & Nat Res 28 0.1 0.1 0.3 1

(8.0) Money Market 2,690 (27.3) (14.3) (0.5) (13)


(10.0) All Bonds 879 3.3 3.5 0.4 56
Jan-92

Jan-94

Jan-96

Jan-98

Jan-00

Jan-02

Jan-04

Jan-06

Jan-08

Jan-10
Govt Treasury 18 0.3 0.0 0.2 26

Source: Compustat, FactSet, and Goldman Sachs Global ECS Research. Source: Compustat, FactSet, and Goldman Sachs Global ECS Research.

Exhibit 34: Average daily TRADING TURNOVER over the last week Exhibit 35: Top ten S&P 500 STOCKS by daily average trading turnover
by sector, as of April 8, 2010 as of April 8, 2010

Materials Avg Daily 1-Week


1.9
Trading Total
Cons Discr 1.2
Company Ticker Sector Turnover (%) Return (%)
Financials 1.1
Massey Energy Co. MEE Energy 28.1 (13)
Info Tech 1.0
American Int'l. Group AIG Financials 19.4 10
Energy 1.0
United States Steel Corp. X Materials 12.0 1
S&P 500 0.9
AK Steel AKS Materials 9.7 2
Telecom Services 0.7
Eastman Kodak EK Consumer Discretionary 9.4 28
Industrials 0.7 Tesoro Corp. TSO Energy 6.1 (8)
Health Care 0.7 Micron Technology MU Information Technology 5.1 4
Utilities 0.7 Abercrombie & Fitch ANF Consumer Discretionary 4.7 1
Cons Staples 0.5 Forest Laboratories FRX Health Care 4.4 (11)
Zions Bancorp ZION Financials 4.4 10
0.0 1.0 2.0
% Daily Avg Trading Turnover S&P 500 Average 1.3 1
Daily average turnover = daily avg trading value / avg market cap (over the past 5 trading days).
Daily average turnover = daily avg trading value / avg market cap (over the past 5 trading days).

Source: Compustat, FactSet, and Goldman Sachs Global ECS Research. Source: Compustat, FactSet, and Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 14


April 9, 2010 United States: Portfolio Strategy

Risk and Dispersion


Exhibit 36: Goldman Sachs Risk Barometer Exhibit 37: VIX Volatility Index
Index is number of standard deviations from the average * 100 as of April 8, 2010

400
90
81
300 All time high on 20-Nov-08
75
Risk Aversion
200 Increasing
60
100

45
0

(100) 30
Risk Aversion 16
(200) Decreasing
15
8-Apr-10
(300) 8-Apr-10
0
Dec-94

Nov-95

Nov-96

Nov-97

Nov-98

Nov-99

Nov-00

Nov-01

Nov-02

Nov-03

Nov-04

Nov-05

Nov-06

Nov-07

Nov-08

Nov-09

Nov-10

Jan-90

Jan-92

Jan-94

Jan-96

Jan-98

Jan-00

Jan-02

Jan-04

Jan-06

Jan-08

Jan-10

Jan-12
Note: Metrics included are implied option volatility (S&P 500 and NASDAQ 100), normalized skew, high
yield credit spreads, credit derivative swap spreads, mutual fund net flows, and cash levels.

Source: Goldman Sachs Global ECS Research. Source: Goldman Sachs Global ECS Research.

Exhibit 38: S&P 500 stock and sector average correlation Exhibit 39: Credit Default Swaps, 5-Year On-the-run Spreads
as of April 8, 2010 as of April 8, 2010

300 1,800
1.0
1,600
0.9 Average sector correlation 250 CDX (HY) (rhs)

Investment Grade CDX (bps)


0.72 1,400
0.8

High Yield CDX (bps)


1,200
200
Average Correlation

0.7
1,000
0.6
150 800
0.5 600
0.37
0.4 100
400
0.3 200
50
0.2 CDX (IG) (lhs) 0
0.1 0 (200)
Average stock correlation
Dec-07

Jun-08

Aug-08

Dec-08

Jun-09

Aug-09

Dec-09
Oct-07

Apr-08
Feb-08

Oct-08

Apr-09
Feb-09

Oct-09

Apr-10
Feb-10
0.0
Dec-89
Dec-90
Dec-91
Dec-92
Dec-93
Dec-94
Dec-95
Dec-96
Dec-97
Dec-98
Dec-99
Dec-00
Dec-01
Dec-02
Dec-03
Dec-04
Dec-05
Dec-06
Dec-07
Dec-08
Dec-09
Dec-10

Source: Goldman Sachs Global ECS Research. Source: Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 15


April 9, 2010 United States: Portfolio Strategy

Goldman Sachs Recommendations and Forecasts


Exhibit 40: Goldman Sachs Recommended Sector Weightings (a) Exhibit 41: Goldman Sachs US Economics quarterly GDP forecasts
as of April 8, 2010 as of April 8, 2010
Sector Weightings

US GDP Growth (qoq annualized %)


4.0 %
Total Goldman Sachs Current GS GS
Return Recommended S&P 500 Overweight / Alpha 3.5 %
Sectors YTD Sector Weightings Weight Underweight YTD
Information Technology 3% 19 % 300 bp (11)bp 3.0 %
Energy 4 Overweight 11 300 (9) 2.5 %
Materials 6 4 200 (2)
2.0 %
Consumer Staples 5 11 0 0 3.5 3.5
Neutral 0
1.5 % 3.0
Industrials 14 10 0 2.5 2.5
Financials 15 17 0 0 1.0 % 2.0
1.5 1.5
Telecom Services (3) 3 (100) 9 0.5 %
Consumer Discretionary 13 10 (200) (12)
Underweight 0.0 %
Utilities (2) 3 (200) 17
Health Care 3 12 (300) 12
Q1E Q2E Q3E Q4E Q1E Q2E Q3E Q4E

S&P 500 7% 100 % 0 bp 4 bp


(a) Sector weightings last rebalanced December 7, 2009. 2010 2011

Source: Goldman Sachs Global ECS Research. Source: Goldman Sachs Global ECS Research.

Exhibit 42: Goldman Sachs COMMODITY and CURRENCY forecasts Exhibit 43: Goldman Sachs US Economics forecasts
as of April 8, 2010 as of April 8, 2010
Forecasts % Annual Change
units Current 3m 6m 12m 2009A 2010E 2011E
Real GDP (2.4)% 2.5% 2.4%
Energy
Consumer Spending (0.6) 1.9 1.4
WTI Crude Oil $/bbl 85.39 92.00 97.00 96.50
Total Fixed Investment (18.4) (3.5) 4.1
NYMEX Nat. Gas $/mmBtu 3.91 5.50 5.50 6.00
Business Fixed Investment (17.8) (3.5) 2.3
RBOB Gasoline $/gal 2.32 2.44 2.50 2.39 Residential Investment (20.5) (3.7) 10.9
Metals Federal Government Spending 5.2 5.2 4.1
LME Copper $/mt 7892 7850 8045 7825 Exports of Goods and Services (9.6) 12.2 7.5
London Gold $/troy oz 1153 1260 1315 1390 Imports of Goods and Services (13.9) 7.9 2.5
London Silver $/troy oz 17.98 21.00 21.90 23.20 Core CPI 1.7 0.8 0.1
Currencies Unemployment Rate 9.3 9.8 10.1
Euro / US Dollar EUR/$ 1.34 1.35 1.35 1.35 Fed Funds Rate 0.1 0.2 0.2
2-year Treasury Rate 0.9 0.9 2.0
US Dollar / Yen $/¥ 93.1 92.0 94.0 98.0
10-year Treasury Rate 3.8 3.3 4.0
Sterling / US Dollar £/$ 1.52 1.55 1.61 1.61

Source: Goldman Sachs Global ECS Research. Source: Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 16


April 9, 2010 United States: Portfolio Strategy

Goldman Sachs Strategy Baskets 1


US Portfolio Strategy baskets are designed to provide portfolio managers with vehicles to monitor and implement thematic views in the U.S. equity markets.
Our baskets may be found on Bloomberg by typing <GSSU5>. The Bloomberg page provides real-time basket performance and current basket constituents.
To obtain access to our baskets on Bloomberg, please contact your Goldman Sachs salesperson.
Exhibit 44: Strategy basket performance and average valuation data Exhibit 45: Strategy basket total return performance over the last week
as of April 8, 2010 last week % total return, as of April 8, 2010
Bloomberg Total Return % P/E P/B Div Yld Weak B/S <GSTHWBAL> 1.6
Ticker 1 wk 1 mo YTD NTM LTM (%) High Sharpe Ratio <GSTHSHRP> 1.1
High Operating Leverage <GSTHOPHI> 1.1
Macroeconomic Baskets GARP <GSTHGARP> 1.0
Western Europe Sales <GSTHWEUR> 0.9
International Sales GSTHINTL 0% 3% 7% 19x 4.6x 1.7 %
Strong B/S <GSTHSBAL> 0.9
US Sales GSTHAINT 1 3 6 17 3.6 1.7 US Sales <GSTHAINT> 0.9
Western Europe Sales GSTHWEUR 1 3 9 17 3.8 0.9 S&P 500 0.8
Hedge Fund VIP <GSTHHVIP> 0.7
BRICs Sales GSTHBRIC 1 4 9 20 4.0 1.1
Robust Profit Margins <GSTHRMAR> 0.7
Strong Balance Sheet GSTHSBAL 1 3 7 21 6.2 1.1 BRIC Sales <GSTHBRIC> 0.6
Weak Balance Sheet GSTHWBAL 2 6 10 19 3.5 1.8 Low Operating Leverage <GSTHOPLO> 0.6
Fragile Profit Margins <GSTHFMAR> 0.5
Robust Profit Margins GSTHRMAR 1 4 11 17 5.6 1.2 High HF Conc <GSTHHFHI> 0.5
Fragile Profit Margins GSTHFMAR 1 5 10 17 3.1 0.9 Dividend Growth <GSTHDIVG> 0.3
High Op Leverage GSTHOPHI 1 5 15 23 4.7 1.2 Int'l Sales <GSTHINTL> 0.1
Invest for Growth <GSTHINVG> 0.1
Low Op Leverage GSTHOPLO 1 5 6 17 6.1 1.9 Low HF Conc <GSTHHFSL> (0.0)
Hedge Fund Baskets (1) 0 1 2

High HF Concentration GSTHHFHI 0% 2 % 10 % 20x 4.5x 0.5 %


Low HF Concentration GSTHHFSL (0) 4 7 15 3.1 3.5 Source: FactSet, and Goldman Sachs Global ECS Research.

Hedge Fund VIP GSTHHVIP 1 4 9 19 4.4 0.9 Exhibit 46: US Portfolio Strategy thematic trade recommendations
Valuation Baskets as of April 8, 2010
Thematic Trade Recommendations
GARP GSTHGARP 1% 4% 7% 17x 4.5x 1.1 %
Initiation
High Sharpe Ratio GSTHSHRP 1 4 7 16 3.5 1.2 Date Return
Use of Cash Baskets BUY High Sharpe Ratio Basket (GSTHSHRP); SELL S&P 500
See 2010 Outlook: Cyclical start; defensive finish (7-Dec-09). 8-Dec-09 3.8 %
Dividend Growth GSTHDIVG 0% 4% 6% 14x 5.3x 3.4 %
BUY High Oper. Leverage (GSTHOPHI); SELL Low Oper. Leverage (GSTHOPLO)
Invest for Growth GSTHINVG 0 3 6 16 4.5 1.5
See Macro to Micro Shift Part II: 2H 2009 Update (20-Jul-09). 20-Jul-09 10.6 %
S&P 500 1% 4% 7% 15x 2.5x 1.9 % BUY BRICs Sales Basket (GSTHBRIC); SELL S&P 500
S&P 500 Average 18 3.6 1.6 See Portfolio Passport: Coming to America (5-Nov-08). 4-May-09 13.9 %
S&P 500 Median 16 2.5 1.2
Source: FactSet, and Goldman Sachs Global ECS Research. Source: FactSet, and Goldman Sachs Global ECS Research.

1
The ability to trade these baskets will depend upon market conditions, including liquidity and borrow constraints at the time of the trade.

Goldman Sachs Global Economics, Commodities and Strategy Research 17


April 9, 2010 United States: Portfolio Strategy

Constituents of High Sharpe Ratio Basket <GSTHSHRP>


Exhibit 47: High Sharpe Ratio Basket
as of April 8, 2010
6-Mo Expected 6-Mo Expected
Current Expected Implied Return / Current Expected Implied Return /
Rating Price Return Vol Implied Vol Rating Price Return Vol Implied Vol
Consumer Discretionary Industrials
Apollo Group APOL NC $63.00 26 % 38 % 0.67 Iron Mountain Inc. IRM NC $26.52 29 % 24 % 1.23
Kohl's Corp. KSS Buy 56.63 15 25 0.58 Donnelley (R.R.) & Sons RRD NC 22.54 20 27 0.74
Gannett Co. GCI NC 17.79 23 43 0.52 Snap-On Inc. SNA NC 44.58 16 27 0.60
Target Corp. TGT Neutral 55.64 8 23 0.36 Fluor Corp. FLR Neutral 49.74 8 30 0.27
Comcast Corp. CMCSA Not Rated 18.43 6 27 0.21 Equifax Inc. EFX NC 35.60 2 23 0.09

Consumer Staples Information Technology


Wal-Mart Stores WMT Buy $55.38 12 % 17 % 0.72 McAfee Inc. MFE Neutral $39.74 21 % 26 % 0.78
Altria Group, Inc. MO Neutral 20.68 10 16 0.63 Compuware Corp. CPWR NC 8.50 21 34 0.61
Molson Coors Brewing Co. TAP Neutral 43.05 12 23 0.53 Intel Corp. INTC Neutral 22.31 15 27 0.56
Kroger Co. KR CS 22.38 10 23 0.44 Hewlett-Packard HPQ Buy 53.63 11 23 0.48
Dean Foods DF Neutral 16.66 8 30 0.25 Yahoo Inc. YHOO Neutral 17.35 10 27 0.36
Coca-Cola Enterprises CCE Not Rated 28.03 (5) 20 (0.27) Novell Inc. NOVL NC 5.86 8 31 0.25
Xerox Corp. XRX NC 10.42 6 31 0.18
Energy MEMC Electronic MaterialsWFR NC 15.64 6 46 0.13
Chesapeake Energy Corp. CHK Neutral $24.11 43 % 36 % 1.19 Electronic Arts ERTS CS 19.19 (3) 35 (0.07)
Southwestern Energy SWN Buy* 40.74 39 39 1.00
Range Resources Corp RRC NC 48.33 33 36 0.93 Materials
Halliburton Co. HAL Buy* 31.66 30 34 0.89 Pactiv Corp. PTV Buy $25.69 21 % 28 % 0.74
El Paso Corp. EP Neutral 11.43 25 33 0.76 Owens-Illinois Inc OI Buy 37.59 6 34 0.18
XTO Energy XTO Neutral 47.75 10 19 0.53
Telecommunication Services
Financials AT & T Inc. T Buy $26.02 13 % 19 % 0.70
Chubb Corp. CB Neutral $51.67 15 % 20 % 0.77 MetroPCS CommunicationsPCS Neutral 7.40 8 49 0.17
State Street Corp. STT Neutral 46.38 20 30 0.68
JPMorgan Chase & Co. JPM Buy* 45.76 16 27 0.58 Utilities
Marsh & McLennan MMC Neutral 24.21 9 21 0.43 AES Corp. AES NC $11.28 54 % 39 % 1.37
NASDAQ OMX Group NDAQ Buy* 21.71 11 28 0.38 Allegheny Energy AYE Not Rated 23.02 11 20 0.57
Allstate Corp. ALL Sell 33.10 6 23 0.28
Northern Trust Corp. NTRS Neutral 57.82 3 24 0.12

Health Care
Gilead Sciences GILD Neutral $45.82 21 % 25 % 0.83
Baxter International Inc. BAX Neutral 57.70 15 20 0.75
Cephalon Inc CEPH Buy 66.78 16 27 0.58
Tenet Healthcare Corp. THC Buy* 5.95 24 48 0.51
Amgen AMGN Buy 60.52 13 27 0.49 Basket Median 13 % 27 % 0.55
Boston Scientific BSX Sell* 6.98 13 45 0.30 S&P 500 Median 7% 28 % 0.26

Source: Compustat, FactSet and Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 18


April 9, 2010 United States: Portfolio Strategy

Recent US Portfolio Strategy


Please contact your Goldman Sachs salesperson for access to additional research or if you wish to be added to the US Portfolio
Strategy research distribution list.

Exhibit 48: Recent research from US Portfolio Strategy

Latest Market Research Publication Date


US Thematic Views: GARP Update April 1, 2010
US Sector Views: Global vs. Domestic tug-of-war within the US equity market March 25, 2010
US Portfolio Strategy: Using Sharpe Ratios to enhance fund returns March 19, 2010
US Equity Views: 4Q Earnings preview: Earnings rise, sales trough, margins expand January 19, 2010
US Portfolio Strategy 2010 Outlook: Cyclical start; defensive finish December 7, 2009

Franchise Research Publication Date


Global Dividend Swap Monitor: Updating our bottom-up dividend forecasts following the results season April 1, 2010
Global Portfolio Strategy: Macro Conference - Asia 2010: Takeaways February 12, 2010
Global Portfolio Strategy: The New BRICS Nifty 50 - EM and DM Baskets November 4, 2009

Periodical Research Description Frequency Timing / Recent Release


Hedge Fund Trend Monitor Analysis of hedge fund holdings and positioning Quarterly February 22, 2010
S&P 500 Beige Book Qualitative assessment of S&P 500 quarterly earnings reports Quarterly February 5, 2010
Strategy Baskets Overview of US Portfolio Strategy thematic baskets Quarterly August 19, 2009
US Monthly Chartbook Monthly report on where to invest in the S&P 500 Monthly April 6, 2010
US Weekly Kickstart Five minute guide to the US equity market Weekly Friday PM
Where to Invest Now Marketing presentation highlighting recent research and best trade ideas Monthly March 5, 2010

Source: Goldman Sachs Global ECS Research.

Goldman Sachs Global Economics, Commodities and Strategy Research 19


April 9, 2010 United States: Portfolio Strategy

Reg AC
We, David J. Kostin, Nicole Fox, Caesar Maasry and Amanda Sneider, hereby certify that all of the views expressed in this report accurately reflect our personal views about the subject company or
companies and its or their securities. We also certify that no part of our compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.

Disclosures
Disclosures required by United States laws and regulations
See company-specific regulatory disclosures above for any of the following disclosures required as to companies referred to in this report: manager or co-manager in a pending transaction; 1% or
other ownership; compensation for certain services; types of client relationships; managed/co-managed public offerings in prior periods; directorships; for equity securities, market making and/or
specialist role. Goldman Sachs usually makes a market in fixed income securities of issuers discussed in this report and usually deals as a principal in these securities.
The following are additional required disclosures:Ownership and material conflicts of interest:Goldman Sachs policy prohibits its analysts, professionals reporting to analysts and members of their
households from owning securities of any company in the analyst's area of coverage.Analyst compensation:Analysts are paid in part based on the profitability of Goldman Sachs, which includes
investment banking revenues.Analyst as officer or director:Goldman Sachs policy prohibits its analysts, persons reporting to analysts or members of their households from serving as an officer,
director, advisory board member or employee of any company in the analyst's area of coverage.Non-U.S. Analysts:Non-U.S. analysts may not be associated persons of Goldman Sachs & Co. and
therefore may not be subject to NASD Rule 2711/NYSE Rules 472 restrictions on communications with subject company, public appearances and trading securities held by the analysts.

Additional disclosures required under the laws and regulations of jurisdictions other than the United States
The following disclosures are those required by the jurisdiction indicated, except to the extent already made above pursuant to United States laws and regulations.Australia:This research, and any
access to it, is intended only for "wholesale clients" within the meaning of the Australian Corporations Act.Canada:Goldman Sachs & Co. has approved of, and agreed to take responsibility for, this
research in Canada if and to the extent it relates to equity securities of Canadian issuers. Analysts may conduct site visits but are prohibited from accepting payment or reimbursement by the company
of travel expenses for such visits.Hong Kong:Further information on the securities of covered companies referred to in this research may be obtained on request from Goldman Sachs (Asia)
L.L.C.India:Further information on the subject company or companies referred to in this research may be obtained from Goldman Sachs (India) Securities Private Limited;Japan:See
below.Korea:Further information on the subject company or companies referred to in this research may be obtained from Goldman Sachs (Asia) L.L.C., Seoul Branch.Russia:Research reports
distributed in the Russian Federation are not advertising as defined in the Russian legislation, but are information and analysis not having product promotion as their main purpose and do not provide
appraisal within the meaning of the Russian legislation on appraisal activity.Singapore:Further information on the covered companies referred to in this research may be obtained from Goldman
Sachs (Singapore) Pte. (Company Number: 198602165W).Taiwan:This material is for reference only and must not be reprinted without permission. Investors should carefully consider their own
investment risk. Investment results are the responsibility of the individual investor.United Kingdom:Persons who would be categorized as retail clients in the United Kingdom, as such term is defined
in the rules of the Financial Services Authority, should read this research in conjunction with prior Goldman Sachs research on the covered companies referred to herein and should refer to the risk
warnings that have been sent to them by Goldman Sachs International. A copy of these risks warnings, and a glossary of certain financial terms used in this report, are available from Goldman Sachs
International on request.
European Union:Disclosure information in relation to Article 4 (1) (d) and Article 6 (2) of the European Commission Directive 2003/126/EC is available at
http://www.gs.com/client_services/global_investment_research/europeanpolicy.html which states the European Policy for Managing Conflicts of Interest in Connection with Investment Research.
Japan:Goldman Sachs Japan Co., Ltd. is a Financial Instrument Dealer under the Financial Instrument and Exchange Law, registered with the Kanto Financial Bureau (Registration No. 69), and is a
member of Japan Securities Dealers Association (JSDA) and Financial Futures Association of Japan (FFAJ). Sales and purchase of equities are subject to commission pre-determined with clients plus
consumption tax. See company-specific disclosures as to any applicable disclosures required by Japanese stock exchanges, the Japanese Securities Dealers Association or the Japanese Securities
Finance Company.

Ratings, coverage groups and views and related definitions


Buy (B), Neutral (N), Sell (S) -Analysts recommend stocks as Buys or Sells for inclusion on various regional Investment Lists. Being assigned a Buy or Sell on an Investment List is determined by a
stock's return potential relative to its coverage group as described below. Any stock not assigned as a Buy or a Sell on an Investment List is deemed Neutral. Each regional Investment Review
Committee manages various regional Investment Lists to a global guideline of 25%-35% of stocks as Buy and 10%-15% of stocks as Sell; however, the distribution of Buys and Sells in any particular
coverage group may vary as determined by the regional Investment Review Committee. Regional Conviction Buy and Sell lists represent investment recommendations focused on either the size of the
potential return or the likelihood of the realization of the return.
Return potentialrepresents the price differential between the current share price and the price target expected during the time horizon associated with the price target. Price targets are required for all
covered stocks. The return potential, price target and associated time horizon are stated in each report adding or reiterating an Investment List membership.
Coverage groups and views:A list of all stocks in each coverage group is available by primary analyst, stock and coverage group at http://www.gs.com/research/hedge.html. The analyst assigns one of
the following coverage views which represents the analyst's investment outlook on the coverage group relative to the group's historical fundamentals and/or valuation.Attractive (A).The investment
outlook over the following 12 months is favorable relative to the coverage group's historical fundamentals and/or valuation.Neutral (N).The investment outlook over the following 12 months is neutral

Goldman Sachs Global Economics, Commodities and Strategy Research 20


April 9, 2010 United States: Portfolio Strategy

relative to the coverage group's historical fundamentals and/or valuation.Cautious (C).The investment outlook over the following 12 months is unfavorable relative to the coverage group's historical
fundamentals and/or valuation.
Not Rated (NR).The investment rating and target price have been removed pursuant to Goldman Sachs policy when Goldman Sachs is acting in an advisory capacity in a merger or strategic
transaction involving this company and in certain other circumstances.Rating Suspended (RS).Goldman Sachs Research has suspended the investment rating and price target for this stock, because
there is not a sufficient fundamental basis for determining an investment rating or target. The previous investment rating and price target, if any, are no longer in effect for this stock and should not be
relied upon.Coverage Suspended (CS).Goldman Sachs has suspended coverage of this company.Not Covered (NC).Goldman Sachs does not cover this company.Not Available or Not Applicable
(NA).The information is not available for display or is not applicable.Not Meaningful (NM).The information is not meaningful and is therefore excluded.

Global product; distributing entities


The Global Investment Research Division of Goldman Sachs produces and distributes research products for clients of Goldman Sachs, and pursuant to certain contractual arrangements, on a global
basis. Analysts based in Goldman Sachs offices around the world produce equity research on industries and companies, and research on macroeconomics, currencies, commodities and portfolio
strategy. This research is disseminated in Australia by Goldman Sachs JBWere Pty Ltd (ABN 21 006 797 897) on behalf of Goldman Sachs; in Canada by Goldman Sachs & Co. regarding Canadian
equities and by Goldman Sachs & Co. (all other research); in Hong Kong by Goldman Sachs (Asia) L.L.C.; in India by Goldman Sachs (India) Securities Private Ltd.; in Japan by Goldman Sachs Japan
Co., Ltd.; in the Republic of Korea by Goldman Sachs (Asia) L.L.C., Seoul Branch; in New Zealand by Goldman Sachs JBWere (NZ) Limited on behalf of Goldman Sachs; in Russia by OOO Goldman
Sachs; in Singapore by Goldman Sachs (Singapore) Pte. (Company Number: 198602165W); and in the United States of America by Goldman Sachs & Co. Goldman Sachs International has approved
this research in connection with its distribution in the United Kingdom and European Union.
European Union:Goldman Sachs International, authorized and regulated by the Financial Services Authority, has approved this research in connection with its distribution in the European Union and
United Kingdom; Goldman Sachs & Co. oHG, regulated by the Bundesanstalt für Finanzdienstleistungsaufsicht, may also distribute research in Germany.

General disclosures
This research is for our clients only. Other than disclosures relating to Goldman Sachs, this research is based on current public information that we consider reliable, but we do not represent it is
accurate or complete, and it should not be relied on as such. We seek to update our research as appropriate, but various regulations may prevent us from doing so. Other than certain industry reports
published on a periodic basis, the large majority of reports are published at irregular intervals as appropriate in the analyst's judgment.
Goldman Sachs conducts a global full-service, integrated investment banking, investment management, and brokerage business. We have investment banking and other business relationships with a
substantial percentage of the companies covered by our Global Investment Research Division. Goldman Sachs & Co., the United States broker dealer, is a member of SIPC (http://www.sipc.org).
Our salespeople, traders, and other professionals may provide oral or written market commentary or trading strategies to our clients and our proprietary trading desks that reflect opinions that are
contrary to the opinions expressed in this research. Our asset management area, our proprietary trading desks and investing businesses may make investment decisions that are inconsistent with the
recommendations or views expressed in this research.
We and our affiliates, officers, directors, and employees, excluding equity and credit analysts, will from time to time have long or short positions in, act as principal in, and buy or sell, the securities or
derivatives, if any, referred to in this research.
This research is not an offer to sell or the solicitation of an offer to buy any security in any jurisdiction where such an offer or solicitation would be illegal. It does not constitute a personal
recommendation or take into account the particular investment objectives, financial situations, or needs of individual clients. Clients should consider whether any advice or recommendation in this
research is suitable for their particular circumstances and, if appropriate, seek professional advice, including tax advice. The price and value of investments referred to in this research and the income
from them may fluctuate. Past performance is not a guide to future performance, future returns are not guaranteed, and a loss of original capital may occur. Fluctuations in exchange rates could have
adverse effects on the value or price of, or income derived from, certain investments.
Certain transactions, including those involving futures, options, and other derivatives, give rise to substantial risk and are not suitable for all investors. Investors should review current options
disclosure documents which are available from Goldman Sachs sales representatives or at http://www.theocc.com/publications/risks/riskchap1.jsp. Transactions cost may be significant in option
strategies calling for multiple purchase and sales of options such as spreads. Supporting documentation will be supplied upon request.
All research reports are disseminated and available to all clients simultaneously through electronic publication to our internal client websites. Not all research content is redistributed to our clients or
available to third-party aggregators, nor is Goldman Sachs responsible for the redistribution of our research by third party aggregators. For all research available on a particular stock, please contact
your sales representative or go to http://360.gs.com.
Disclosure information is also available at http://www.gs.com/research/hedge.html or from Research Compliance, One New York Plaza, New York, NY 10004.
Copyright 2010 The Goldman Sachs Group, Inc.
No part of this material may be (i) copied, photocopied or duplicated in any form by any means or (ii) redistributed without the prior written consent of The Goldman Sachs
Group, Inc.

Goldman Sachs Global Economics, Commodities and Strategy Research 21

Das könnte Ihnen auch gefallen