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Risk in Commodity Investment

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					                                                                                                                                                               Asset Allocation



                                                                  Balanced-Risk Commodity Strategy
                                                                  Quarterly Results as of June 30, 2011




Key Facts                                                         Investment objective
                                                                  The objective of the strategy is to outperform the Dow Jones-UBS Commodity Index by 5% per annum over
Composite inception                                 9/30/08       a rolling 3 to 5 year investment horizon. The strategy will strive to achieve this objective with a proprietary
                                                                  risk-balanced investment process across the various commodity complexes.
Total strategy assets*                         $772 million
Benchmark                                 Dow Jones-UBS
                                         Commodity Index          Investment strategy
                                                                  The portfolio uses a risk premium capture strategy that seeks to generate returns by investing in the
                                                                  commodity markets using a risk-balanced investment process. The strategy is diversified across the
Available Investment Vehicles                                     commodity complex including, but not limited to, energy, agriculture, precious metals and industrial metals.
                                                                  Specifically, the team selects the appropriate assets for the strategy, allocates them based on their
Separate account                     $25 million minimum          proprietary risk management and portfolio construction techniques and then applies an active positioning
Collective trust                      $1 million minimum          process to improve expected returns. Each is highlighted below:
                                                                  Asset selection
Risk Allocation (%)                                               The management team begins the process by selecting representative assets for each commodity exposure.
                                                                  The selection process first estimates the long-term correlations among assets across multiple market
                                   Risk**      Contribution       environments and accepts assets only if they make a considerable improvement in marginal expected
                                                                  risk-adjusted returns. The team then evaluates the theoretical case for long-term excess returns relative to
Agriculture                          2.63              14.93      cash. Finally, the remaining assets are screened to meet minimum liquidity criteria.
Energy                               3.51              19.93
                                                                  Portfolio construction
Industrial Metals                    6.07              34.47      The optimization in the portfolio construction step reflects long-term expectations. Proprietary estimates for
Precious Metals                      5.40              30.66      risk and correlation are used by the management team to create an optimized portfolio. The team re-
Total Risk                         17.61             100.00       estimates the risk contributed by each asset and re-optimizes the portfolio at least annually or when new
                                                                  assets are introduced to the portfolio.
* Total strategy assets shown above may include assets that
  are not reflected in the GIPS composite.                        Active positioning
**Risk represents ex-ante standard deviation                      The management team actively adjusts portfolio positions to reflect the near-term environment while
Ex-ante standard deviation measures a fund’s range of total       remaining consistent with the optimized portfolio structure. The management team balances these two
returns and identifies the spread of a fund’s fluctuations over   competing ideas – opportunity for excess return from active positioning and the need to maintain asset class
a defined, forward-looking, period of time. The risk level        exposure – by setting controlled tactical ranges around the optimal long-term allocation. The tactical ranges
derived from each underlying asset determines how much            differ for each asset based on the management team’s estimates of volatility.
the asset will contribute from a dollar-weight standpoint.
                                                                  Second quarter commentary
Distinguishing Attributes                                         Market background/conditions:
– Pure commodity exposure through the use                         Global equity markets saw meaningful volatility in the second quarter after enjoying a strong rally that began
  of exchange traded futures                                      in the third quarter of 2010. Causes of the pullback are familiar, being largely the same as those that caused
– Flexible application (stand-alone or combined                   weakness in the second quarter of 2010: concerns about peripheral European economies, an end to the
  with beta)                                                      current round of quantitative easing and doubts about economic performance in the absence of government
– No lock-up periods, transparent and competitive                 stimulus. Bonds had a strong quarter as yields declined in response to global economic uncertainty. Like
  fees                                                            equities, most commodities saw increased volatility, with economically sensitive ones, such as crude oil and
– Targets better diversification and smaller                      copper, experiencing pronounced negative price moves.
  drawdowns than the benchmark                                    Performance analysis:
                                                                  The Balanced-Risk Commodity strategy had a negative return for the quarter, but handily outperformed the Dow
Investor Profile                                                  Jones-UBS Commodity Index. During the quarter, a strategic gold position was beneficial as gold acted as a safe
The strategy may be appropriate for investors who                 haven asset amid volatility. Strategic exposures to crude oil and soymeal detracted. Special tactical exposures, such
seek to gain exposure to the commodity asset class                as shorts on certain agricultural markets and energy spread trades, added to return, but the combined net effect
with an active, benchmark-agnostic strategy that                  was only marginally positive. For the year-to-date period, precious metals and energy complexes aided return, while
seeks to outperform the Index over a market cycle                 industrial metals and, especially, agriculture and livestock, detracted. Crude oil and gold have benefited from
with lower volatility and lower drawdowns.                        geopolitical uncertainty, and to differing degrees, from loose monetary policy. Late in the second quarter, IEA
                                                                  intervention in the oil markets created a sharp pullback in oil prices, but this effect may be short-lived. Similarly,
Source: Invesco, Dow Jones-UBS Commodities Index.                 select agricultural markets, corn and wheat in particular, were shaken after a USDA report showed more acres
                                                                  were planted than expected given the Midwest flooding Inventory reports showing that supplies were not as tight
For U.S. InStItUtIonAl InveStor USe only                          as anticipated also depressed prices. Overall, tactical portfolio positions added to performance, with notable
                                                                  contributions from select trades within energy and precious metals.
The opinions expressed herein are based on the current
market environment and are subject to change without              Strategy and outlook:
notice.                                                           Thus far, 2011 is following the path of typical recoveries from balance sheet recessions which are
                                                                  characterized by slow, uneven growth that fails to match the pre-recession norm. The market is still
                                                                  contending with challenges such as the European debt crisis and how the economy will perform without
                                                                  government stimulus. The strategy’s commodity positions shifted from significantly overweight to slightly
                                                                  above neutral, primarily due to changes in term structure and price momentum. Much of the reduction
                                                                  occurred in agricultural commodities where heightened supply concerns started to recede. Conversely, we
                                                                  still find precious and industrial metals attractive.
2 The objective of the Balanced-Risk Commodity investment               Periodic Total Returns (%)                                                                            Composite Inception 9/30/08
   strategy is to outperform the index, Dow Jones-UBS
   Commodities Index, by 5% per annum over a rolling three to           • Balanced-Risk (net)           • Balanced-Risk (gross)              • Dow Jones-UBS Commodity Index
   five year investment horizon. The strategy will strive to
   achieve this objective with a proprietary risk parity strategy       20
   that targets lower portfolio risk than the benchmark and seeks
   to minimize the risk of large draw downs with a risk-balanced        15
   investment process. Portfolio risk is defined as the annualized      10
   standard deviation of the strategy’s returns.
 3 The Composite returns are benchmarked to Dow Jones-UBS                 5
   Commodity Index. The benchmark is used for comparative                 0
   purposes only. Investments made by the Firm for the portfolios
                                                                         -5
   it manages according to respective strategies may differ
   significantly in terms of security holdings, industry weightings,    -10                   Quarter                                      YTD                                 Since Inception**
   and asset allocation from those of the benchmark. Accordingly,
   investment results and volatility will differ from those of the
   benchmark.                                                           Performance (%)
 4 The Balanced Risk Commodities Strategy invests primarily in                                                                                       Quarter                    YTD              Since Inception
   derivatives including commodity futures, exchange traded
   funds, and commodity linked notes. The composite notional            Balanced-Risk (net)*                                                             -2.99                 -0.14                          16.24
   value will generally not exceed 1.5 times capital.                   Balanced-Risk (gross)                                                            -2.82                  0.20                          17.05
 5 Valuations and portfolio total returns are computed and stated
                                                                        Dow Jones-UBS Commodity Index                                                    -6.73                 -2.58                           -1.97
   in U.S. Dollars. The firm consistently values all portfolios each
   day on a trade date basis. Portfolio level returns are calculated    *Net of max 70 bps fee
   as time-weighted total returns on daily basis. Accrual               Past performance is not a guarantee of future results.
   accounting is used for all interest and dividend income. Past
   performance is not an indication of future results.
 6 Carve-outs from multi-asset class portfolios are included within     Performance Attribution (Gross Excess)(%)
   this composite. Cash is allocated to the constituent                                                                                              Quarter                    YTD            Since Inception*
   commodities segment carve-out returns to arrive at a total
   return for each portfolio. Carve-out returns are calculated by       Agriculture                                                                     -2.76                  -1.97                            5.06
   allocating cash according to the strategic target cash position      Energy                                                                          -2.01                   0.47                           -1.96
   for the strategy. As of 31 December 2009, carve-outs                 Industrial Metals                                                                0.11                  -0.26                            3.66
   comprised 57% of the composite.
 7 Composite dispersion is measured by the standard deviation           Precious Metals                                                                  1.74                   1.22                            7.24
   across asset-weighted portfolio returns represented within the       Active Positioning                                                               0.10                   0.74                            3.05
   composite for the full year.                                         Total                                                                           -2.82                   0.20                          17.05
 8 Gross-of-fee performance results are presented before                * Composite Inception 9/30/08
   management and custodial fees but after all trading
   commissions and withholding taxes on dividends, interest and
   capital gains, when applicable. Net-of-fee performance results       Performance (%)
   are calculated by subtracting the highest tier of our published
                                                                                                                                                 Gross Rate of              Net Rate of               Benchmark
   fee schedule for the product from the monthly returns.
                                                                                                                                                   Return (%)               Return (%)                Return (%)
   The management fee schedule is as follows:
   70 basis points on the first $100 million                            2010                                                                                31.10                   30.19                     16.83
   60 basis points thereafter.                                          2009                                                                                52.29                   51.23                     18.91
 9 The minimum portfolio size for the Composite is $5,000,000.
10 The composite creation date is April 29, 2010.                       2008                                                                              (22.93)                 (23.06)                  (30.04)
11 A complete list and description of Firm composites and               (3 month)
   performance results is available upon request. Additional
   information regarding policies for calculating and reporting         Annual Compound Rates of Return Ending December 31, 2010:
   returns is available upon request.                                   1 Year                                                                              31.10                   30.19                     16.83
                                                                        2 Years                                                                             41.30                   40.32                     17.86
                                                                        Since Inception (09/30/2008)                                                        21.11                   20.27                    (1.26)
Invesco Global Asset Allocation
two Peachtree Pointe
1555 Peachtree Street ne
Atlanta, GA 30309                                                      Invesco Worldwide claims compliance with the Global Investment Performance Standards (GIPS®).
Phone 404.892.0896                                                     Notes
                                                                       1 Invesco Worldwide (“The Firm”) manages a broad array of investment strategies around the world. The Firm comprises U.S.-based Invesco
All material presented is compiled from sources                           Advisers, Inc. and all wholly owned Invesco firms outside of North America. All entities within the Firm are directly or indirectly owned by
believed to be reliable and current, but accuracy                         Invesco Ltd. GIPS-compliant firms whose assets are managed by subsidiaries of Invesco Ltd. are Invesco Trimark Ltd. and Atlantic Trust.
cannot be guaranteed. Past performance is not                             Invesco Senior Secured Management, Inc. Invesco Private Capital, Inc. and Invesco PowerShares Capital Management LLC are also affiliates of
indicative of future results. This is not to be                           the Firm. Each is an SEC-registered investment adviser and is marketed as a separate entity. Invesco Great Wall Fund Management Co. Ltd (IGW)
considered an offer to buy or sell any financial                          is a fund management company established under China Securities Regulatory Commission’s approval. Their assets are excluded from total
instruments. As with all investments, there are                           Firm assets. On Dec. 31, 2009, Invesco Aim Advisors, Inc. (AIM), Invesco AIM Capital Management, Inc. (ACM), Invesco Aim Private Asset
associated inherent risks. Please obtain and review                       Management, Inc. (APAM) and Invesco Global Asset Management (N.A.), Inc. merged into Invesco Institutional (N.A.), Inc., which was then
all financial material carefully before investing.                        renamed Invesco Advisers, Inc. Prior to 2010, AIM, ACM and APAM were part of separate GIPS firms and not included in the Firm. All Firm
                                                                          verifications have been completed through Dec. 31, 2009. On June 1, 2010, Invesco acquired Morgan Stanley Investment Management’s
To receive a presentation that adheres to the                             (MSIM) retail asset business, including Van Kampen Investments. Through this transaction, Invesco acquired approximately $119 billion in
GIPS standards, please contact Gwen Lansing                               assets under management. Prior to the acquisition, MSIM was GIPS compliant and verified by an independent verifier through Dec. 31, 2008.
at 404-439-3117 or by e-mail at Gwen.Lansing@                             Assets under management prior to 2010 have not been restated to reflect either the above-referenced investment adviser merger or the
invesco.com.                                                              MSIM acquisition. Composite history and Firm assets prior to Jan. 1, 2010, are those of its respective components.




                                                                       institutional.invesco.com                          II-GACOMM-FCT-1-E 07/11                                            7538

				
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