Final Intern Presentation

Cynitresse S. CarterInvestment Advisory Business SupportAugust 3, 2011

AgendaProgram List Investments/Model Change Communication Plan

Performance Reports: SMA Model/Composite

Key Terms

SMASeparately Managed AllocationsPLIProgram List InvestmentsOverlay ManagerNatixis Managed Portfolio AdvisorsVestmarkPortfolio Accounting Platform

Project 1: Program List Investments/Model Change Communication Plan

Initial Communication and Trade ImpactFund/SMA Addition PlanningResearch Model Change PlanningFund/SMA Removal PlanningFinal Communication, Testing, Publishing & ProductionProgram List Additions, Changes, and Removals

Stakeholders

Investment Advisory Business Support Investment Advisory Marketing Managed Account Operations Advisory Service

Advisory Solutions Operations Investment Advice Client Proposal Tools Compliance Mutual Fund Research

ResultsOrder of steps in the timeline

Communication Plan to inform stakeholders

Consolidated Communication Plan and Timeline

Project 2:SMA Performance Reports

OverviewIssueNo performance tracking for SMAs

AssignmentDevelop reports to track performance for 61 SMA strategies on the Program List

Develop report to compare SMA strategy received by Edward Jones against performance reported by SMA Manager to the industry

ProcessStakeholdersInvestment Advisory Business Support

Mutual Fund Research

Investment Advisory AdviceVestmark

Composite of SMA Client Accounts

SMA 1Client Account Performance 7/1/2011-8/1/2011# of Standard Deviations from CompositeAccount 111.1%0.4Account 211.0%0.4Account 311.0%0.4Account 414.0%1.8Account 510.9%0.5

Average11.6%Standard Deviation1.34%

SMA Master Model

SMA NamePSN /MorningstarSMA's Model PerformanceSMA111%11%SMA211%11%SMA35%7%SMA4-1%-1%

ResultsInvestment Advice has a tool for analysis and identification of outliers

Investment Advice can compare composite performance against the SMA Master model

Mutual Fund Research has a tool to compare the SMA performance received by Edward Jones against the performance reported to the industry by the SMA Manager

ConclusionExperienceBenefitWhat I Gained

Hello, I am Cynitresse Carter. I attend Alcorn State University in Lorman, Mississippi. I will be graduating in December with a Bachelor of Science in Accounting. This summer I interned in the Investment Advisory Department, on the Business Support team, my leader was John Cowie.. I had the chance to work on two projects during my internship. The first was a project to develop a communication plan and timeline for changes to program list investments and/or model changes in the Unified Managed Account models. The second project required me to develop SMA performance reports for UMA models.

Before I discuss my projects in more detail there are a few key terms that I think you should know. The first term is SMA. An SMA is an investment strategy of stocks and/or bonds managed by a Separately Managed Account Manager. The second term is program list investment or PLI. A PLI is a mutual fund or SMA strategy selected by our mutual fund research area and placed on the master Advisory Solutions program list. The next term is Overlay Manager. An overlay manager manages the accounts and implements the SMA strategies within the UMA models. The Overlay Manager for our UMA models is Natixis Managed Portfolio Advisors. The last term for you to know is Vestmark. Vestmark is a software platform used by Edward Jones and Natixis to direct trading decisions.

Now let's discuss my first project.*From the diagram, these changes include the addition and/or removal of mutual funds and/or SMA strategies. In order to implement these changes there are several activities that need to occur and several stakeholders that need to be informed. My task was to develop a timeline of the activities and a communication plan for the stakeholders in order to ensure that the changes are implemented and the stakeholders are informed.

*In order to develop the timeline and communication plan, I worked closely with Steve Harris of the Investment Advisory Business Support team. The first step of this project was to evaluate the existing timeline and process for PLI and model changes in Fund Models. This would let know how many of the steps were relevant for changes to UMA Models. Once I evaluated the timeline and process I led targeted meetings with the affected stakeholders to discuss the findings. The first six areas discussed the implementation of these changes and the last three discussed the communication of these changes. After we reviewed the timeline and process, both groups found that there was significant overlap for the existing process for Fund Models and the necessary steps for UMA Models.As a result, instead of creating a brand new plan for UMA Models, I created a consolidated process for Fund Models and UMA Models as well as a timeline to communicate program list changes. The individual PLI/Model change processes for both Fund Models and UMA Models had well over 100 steps. The new combined process was able to remove a number of redundancies and has 47 steps. Hopefully this new timeline and communication plan will prove to be beneficial any time Mutual Fund Research makes a change to the program list or Advisory Solutions Models. Here is a snapshot of the communication plan and timeline. I will provide you with the plan in its entirety at the end of my presentation.

Now that you have a good understanding about the timeline and communication plan for both Fund Models and UMA Models, in Advisory Solutions, let's talk about my second project.

*At the launch of UMA the firm had no process in place to track the performance of SMAs in UMA models. My task for this project was to create reports to track the performance of SMAs within UMA models. These reports will be used by Mutual Fund Research and Investment Advice to perform due diligence on the SMA Managers in the UMA models. *In order to do this I worked with Greg Wilson of the Investment Advisory Business Support team to learn how to write reports using the Vestmark system. Then, we met with Mutual Fund Research and Investment Advice to get a better understanding of what types of reports and what information they need to carry out the due diligence process. After we learned the Vestmark system and met with the key stakeholders I was able to work with Greg to create two types of SMA performance reports.

*The first type of performance report I created is a composite performance report. This report tracks the performance of actual client accounts in each SMA strategy. It can be used by the Advice team to identify outliers or accounts that deviated from the average performance of accounts in a particular SMA strategy. For example, you can see that account 4 has a 14% return but, the average is 11.6%. This is an outlier. *The second type of report I created is called the Master Model performance report. This report compares the performance given to Edward Jones from the SMA Managers against the performance the SMA Managers reported to the industry. The report can be used in two ways. First, the report can be used to verify that Natixis received the correct strategy from the SMA Managers. And second, Mutual Fund Research can use this report as one of the inputs to decide whether or not to keep a strategy on the program list. For example, three of the SMA's are sharing the same return with the industry but SMA 3 does not. The difference between the industry and Natixis performance numbers gives Mutual Fund Research an to investigate whether Natixis received the correct model. If Mutual Fund Research decides to remove a strategy from the program list hopefully the communication plan and timeline that I discussed earlier will come in handy.

**In conclusion, this summer I had an excellent experience working on real projects that will affect the Investment Advisory Department even after I leave. I really appreciated the opportunity to participate in such challenging tasks. The projects that I worked on and the internship activities I participated in, truly made for an exciting summer. I gained a lot during these eight weeks, lessons I know I will carry with me throughout my professional career. Thank You.