Investment Philosophy

oisington Investment Management Company focuses on long-term investment strategies based on Economic Analysis. This firm believes that by keying its investment decisions on the multi-year trend in the inflation rate it is able to provide the maximum return for bond investors. During periods of sharply-rising inflation, the usual--or normal--investment posture is in very short maturities, frequently 100% cash equivalents. Conversely this firm is equally "at home" with a portfolio of 30-year U.S. government securities during periods of low risk, i.e., falling inflation.

Hoisington Management is convinced that this policy of maintaining maximum flexibility with the maturity structure of the portfolio provides clients with the greatest possible protection against capital losses over any sustained bear market. Also, the willingness to stretch maturities to the maximum provides the opportunity for spectacular profits in bull market periods. In accordance with this philosophy, only the most liquid and highest quality securities are utilized in the portfolios--specifically U.S. government bonds, notes, or bills.

Background

Hoisington Investment Management Company is a registered investment advisor specializing in the management of fixed income portfolios for large institutional clients. With offices in Austin, Texas, the firm was founded in 1980 by Van R. Hoisington, President and Chief Investment Officer, and has produced an outstanding fifteen-year performance record. Dr. Lacy Hunt, an internationally known economist, joined the firm in 1996 adding depth and expertise to the investment staff. Working with Dr. Hunt, Van's sons, V.R. and David, have installed state of the art techniques for tracking the key factors in the company's strategic approach to money management. Jan Teague Bright, a founding member of the firm, and John A. Dahlheim complete the investment staff.

The firm has over 4.5 billion under management, with a client base of corporate and public funds, foundations, endowments, Taft-Hartley funds and insurance companies. The average client size is $117 million and the average client relationship is eleven years. Smaller accounts are managed in the Wasatch-Hoisington U.S. Treasury Fund, a no-load mutual fund distributed by ALPS Distributors, Inc. Additional information about the fund can be found at Morningstar.com or www.wasatchfunds.com .