Market Charts

Transcript

1 Market Charts Turning data into knowledge Second Quarter 2019 All data shown in the charts as of Q1 2019 and reflect the most recent information Please see disclosures for the risks associated with the asset classes and available. for the definitions of market- based and economic indices. 19 FASS411 04- 1

2 About Wells Fargo Investment Institute ECONOMY ECONOMY Wells Fargo Investment Institute has one overarching mission: to deliver timely and actionable capital market perspectives that inform investors about relevant EQUITIES EQUITIES market events, policy decisions, and geopolitical factors that may affect their FIXED FIXED portfolios. One of its key publications, Market Charts, provides broad INCO ME INCOME macroeconomic perspectives across four major asset groups (equity, fixed income, REAL REAL real assets, and alternative investments), currencies, and asset allocation. Market ASSET S ASSETS Charts is now available to Wells Fargo Asset Management clients. ALTERNATIVE ALTERNATIVE ESTMENTS IN V INVESTMENTS Wells Fargo Asset Management offers active management, expertise, and thought leade rship from over 29 autonomous investment teams, backed by an independent CURRENCIES CURRENCIES risk management framework. Each team is focused on specialized, niche portfolio management strategies to meet the diverse needs of institutions, financial ASSET ASSET ALLOCATION ALLOCATION advisors, and individuals worldwide. DISCLOSURES DISCLOSURES 2 2 2

3 Contents Economy 4–25 Equities 26–39 Fixed income 40–49 Real assets 50–60 Alternative investments 61–72 Currencies 73–79 Asset allocation 80–100 Disclosures 101–112 3

4 Economy highlights ECONOMY Macro Wells Fargo Investment Institute believes the global economy should grow in the • EQUITIES range of 3.5% to 4% in 2019. FIXED INCOME • Manufacturing continues to expand across most major economies; however, at slower rates than in recent years as business confidence wanes. REAL ASSETS • Concerns surrounding global trade persist. Some currency volatility is expected ALTERNATIVE (for example, the U.S. dollar, euro, and yen). INVESTMENTS Domestic CURRENCIES • There appears to be only a low chance of a near-term recession in the U.S. in ASSET 2019. ALLOCATION • Consumer confidence has weakened recently and is likely to remain under DISCLOSURES pressure as a host of geopolitical uncertainties dominate headlines. Despite building uncertainty, we expect growth in household spending to be • supportive of economic growth this year. International • Europe is a growing downside risk to the developed economy outlook. China’s slowing growth is likely to be contained, while some emerging countries look to continue recovering in 2019. 4 4

5 economy scorecard Global ECONOMY Eurozone Japan China U.S. Metric World EQUITIES GDP growth (%YoY) 1.1 3.7 6.4 0.3 3.0 1 as of 12/31/2018 FIXED INCOME Inflation (%YoY) 0.2 1.4 1.5 1.5 3.7 1 as of 2/28/2019 REAL ASSETS Manufacturing 2 Index level 55.3 50.5 50.6 47.5 49.2 ALTERNATIVE INVESTMENTS as of 3/31/2019 Central bank rate CURRENCIES (%) as of 0.00 4.35 2.50 – -0.10 3/31/2019 ASSET Consumer ALLOCATION Confidence Index – 124.1 -7.2 40.9 123.0 level as of DISCLOSURES 3/31/2019 Unemployment rate (%) as of – 3.8 7.8 2.3 3.8 2/28/2019 Sources: Bloomberg, International Monetary Fund, and Wells Fargo Investment Institute. Consumer confidence scale differs by r egi on/country. Up or down arrow indicates an increasing or decreasing level from the previous quarter. GDP = gross domestic product. YoY = y ear over year. KEY TAKEAWAYS • Manufacturing activity has come under pressure lately on waning business confidence. • Weaker consumer confidence likely will be a headwind to economic growth in key economies this year. 1. World data is an International Monetary Fund estimate as of December 31, 2018 ® indices , which is a composite index based on the diffusion of for Supply Management (ISM) Manufacturing Index Index level 2. Manufacturing is the Institute five of the indices with equal weights: supplier (seasonally adjusted), production (seasonally adjusted), employment (seasonally adjusted), new orders expansion; below 50 indicates contraction. The values for the index can be deliveries (seasonally adjusted), and inventories . An index value over 50 indicates 5 5 between 0 and 100.

6 The world at a glance ECONOMY POPULATION GROSS DOMESTIC STOCK BONDS PRODUCT (PPP) OUTSTANDING CAPITALIZATION EQUITIES 4% 12% FIXED 15% 10% INCOME 20% 36% REAL 86% ASSETS 26% 33% 55% 59% ALTERNATIVE INVESTMENTS 43% CURRENCIES ASSET U.S. U.S. U.S. U.S. ALLOCATION Developed Markets Ex-U.S. Developed Markets Ex-U.S. Developed Markets Ex-U.S. Developed Markets Ex-U.S. Emerging Markets Emerging Markets Emerging Markets Emerging Markets DISCLOSURES Sources: IMF Global Economic Outlook database, October 2018; MSCI, as of February 28, 2019; and Bank for International Settlements, as of September Emerging markets includes frontier markets. Purchasing power parity (PPP) is a theory which states that exchange 30, 2018. rates between currencies are in equilibrium when their purchasing power is the same in each of the two countries. Stock capitalization is based on country weightings in the MSCI All Country World Index. KEY TAKEAWAYS • The vast majority of the world’s population resides in emerging and frontier markets. These regions com prise nearly 60% of the global economy but only about 10% of the world’s equity markets. • Emerging markets carry 20% of the global government debt. 6 6

7 global economy affect the Factors that ECONOMY Global economic forces EQUITIES TAILWINDS HEADWINDS FIXED INCOME ● Global populism ● Low interest rates Growing dovishness in ● Weakening business and ● REAL ASSETS central bank policy consumer sentiment Continued positive Concerns about slowing in ● ● ALTERNATIVE INVESTMENTS the U.S. and other major earnings growth economies environment CURRENCIES ● ● Anti -trade, anti - Still positive household immigration consumption and policies/sentiment business investment ASSET ALLOCATION activity ● Currency volatility DISCLOSURES ● Rising geopolitical risks Source: Wells Fargo Investment Institute, as of March 31, 2019. Subject to change. KEY TAKEAWAYS • Concerns surrounding global trade have risen. Some currency volatility is expected (for example, the U.S. dollar , euro, and yen). • Consumer spending remains the main source of global growth. 7 7

8 forecasts for GDP growth 2019 ECONOMY Russia U.K. 1.7% 1.3%. Germany EQUITIES 1.1% France 1.1% Turkey Italy U.S. 2.5% FIXED 0.5% China Japan 2.5% INCOME 6.2% 1.2% India Mexico 7.6% 2.5% REAL ASSETS ALTERNATIVE INVESTMENTS Brazil CURRENCIES 2.5% Australia 3.0% ASSET ALLOCATION Emerging Americas 2.5% DISCLOSURES 6.4% Emerging Asia 2.0% Developed Asia Emerging Europe 2.4% 1.2% Eurozone 3.0% Developed markets Middle East/North Africa Emerging markets 3.6% Sub-saharan Africa Source: Wells Fargo Investment Institute estimates for developed and emerging economies, as of March 7, 2019. Forecasts and estimates are to change based of market and economic conditions and are subject on our current view . KEY TAKEAWAYS • Wells Fargo Investment Institute expects that the global economy should expand 3.6% in 2019. • Growth rates across regions and countries are uneven. We expect developed economies to generally grow slowly than emerging countries in 2019. more 8 8

9 across regions Inflation diverging ECONOMY SLOWING GLOBAL INFLATION IS DECLINING COSTS FOR PRODUCERS EQUITIES 15 10 FIXED INCOME 8 10 6 REAL ASSETS 5 4 ALTERNATIVE INVESTMENTS 2 0 CPI YoY (%) Index YoY (%) CURRENCIES 0 -5 -2 ASSET ALLOCATION -10 -4 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 DISCLOSURES BRIC Japan U.S. Eurozone Eurozone PPI Japan CGPI China PPI Sources: Bloomberg, FactSet, and Wells Fargo Investment Institute, as of February 28, 2019. BRIC is an acronym for the economies of Brazil, Russia, India, and China. CPI is the Consumer Price Index, which measures the price of a fixed basket of goods and services purchased by an average consumer. measures the average change over time in the selling prices received by domestic PPI is the Producer Price Index, which producers for their output. The prices included in the PPI are from the first commercial transaction for many products and some services. KEY TAKEAWAYS • Global consumer price inflation continued to slow in the first months of 2019. higher from the near- • Evidently, the normalization process is slow, but inflation rates have begun moving zero pace we were experiencing a few years ago. 9 9

10 expanding Manufacturing is GLOBAL MANUFACTURING ACTIVITY STILL EXPANDING ECONOMY 60 U.S. -month EQUITIES Eurozone 55 Global China average contracting FIXED 50 Eurozone Japan INCOME PMI Index level 12 45 (Above 50 = expanding; below 50 = REAL Represents the dividing line between expansion/contraction in manufacturing ASSETS Manufacturing activity trending up Manufacturing activity trending down ALTERNATIVE INVESTMENTS MANUFACTURING AS A PERCENTAGE OF THE ECONOMY (GDP) 35 31.9 CURRENCIES 28.8 Manufacturing % Manufacturing % 30 decreasing increasing 25 21.2 21.0 19.2 18.9 ASSET 20 15.6 15.5 ALLOCATION 15.1 14.9 14.3 12.8 15 11.6 Percent 9.4 10 DISCLOSURES 5 0 South Asia Japan China United States European Union Least developed World countries 2016 2000 Bank national accounts data, and OECD Sources: Bloomberg, HSBC Markit and Wells Fargo Investment Institute, as of March 31, 2019, World National Accounts data files as of December 31, 2016. The PMI Index is an index developed from monthly business surveys used to monitor the condition of industries and businesses. KEY TAKEAWAYS • Rising wages in emerging economies have made certain manufacturing activities more viable in developed marke ts. • Cost differentials remain; however, emerging economies should continue to play a key role in the global supply chain. 10 10

11 Global trade continues to weaken KEY GLOBAL TRADE INDICATORS SPIRALING DOWN 50 ECONOMY 40 EQUITIES 30 FIXED INCOME 20 REAL 10 ASSETS Index value 0 ALTERNATIVE INVESTMENTS -10 CURRENCIES -20 ASSET ALLOCATION -30 -40 DISCLOSURES 1997 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 1999 IFO Germany Manufacturing Export Expectations South Korea Exports (YoY %) Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31, 2019. KEY TAKEAWAYS • As Europe’s largest economy and a top global exporter, Germany has been particularly exposed to the trade slowd own. South Korea exports are a key indicator to gauge the direction of global growth. • 11 11

12 policy in action monetary Global JAPAN HAS EXPANDED ITS BALANCE ECONOMY BENCHMARK RATES REMAIN LOW BUT SHEET FAR MORE THAN THE U.S. AND ARE RISING IN THE U.S. THE EUROZONE 8 EQUITIES 7 100% FIXED INCOME 6 80% REAL 5 % of GDP ASSETS 60% 4 ALTERNATIVE INVESTMENTS 3 40% bank assets as a CURRENCIES Benchmark Rate (%) 2 20% Central 1 ASSET ALLOCATION 0 0% '00 '02 '04 '06 '08 '10 '12 '14 '16 '18 DISCLOSURES U.S. Fed Funds Rate Eurozone Main Refi Min Bid Rate Bank of England Base Rate Fed ECB BOJ China 1 Year or Less Rate On RMB Sources: Bloomberg and Wells Fargo Investment Institute, as Institute, as of Wells Fargo Investment Sources: FactSet and of March 31, 2019. BOJ = Bank of Japan. ECB = European March 31, 2019. Headline central bank policy rates of selected Central Bank. countries. KEY TAKEAWAYS • The Bank of Japan continues to emphasize easy monetary conditions to promote growth and reduce defl ationary pressures, while the European Central Bank has ended its quantitative easing program. -end 2019. ) to finish with its hiking rate cycle by year • We expect the Federal Reserve (Fed 12 12

13 Where are we today? HIGHER OIL PRICES ARE RECOVERED IN Q1 STOCK MARKET 3,000 30 120 ECONOMY 25 100 2,600 20 80 EQUITIES 15 2,200 60 10 Index level 40 $ per barrel FIXED 1,800 INCOME 5 20 0 1,400 0 REAL 2013 2014 2015 2016 2017 2018 2019 2013 2014 2015 2016 2017 2018 2019 ASSETS S&P 500 Index S&P 500 volatility WTI crude oil ALTERNATIVE COOLING OFF INFLATION IS U.S. DOLLAR REMAINS STRONG INVESTMENTS 3.5 105 3.0 100 CURRENCIES 2.5 95 2.0 year (%) 1.5 90 ASSET 1.0 ALLOCATION 85 Index level 0.5 80 Year over 0.0 DISCLOSURES 75 -0.5 2013 2014 2015 2016 2017 2018 2019 2013 2014 2015 2016 2017 2018 2019 U.S. Dollar Index Average Consumer price inflation Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31, 2019. For illustrative purposes only. S&P 500 volatility is measured by the CBOE Volatility Index® (VIX®), which is a key measure of market expectations of near -term volatility conveyed by S&P 500 stock i ndex option prices. The Consumer Price Index measures the average price of a basket of goods and West Texas Intermediate (WTI) is a services, as of February 28, 2019. grade of crude oil used as a benchmark in oil pricing. An index is unmanaged and not available for direct investment. U.S. Dollar Index (USDX) measures the value of the U.S. dollar relative to the majority of its most significant trading partners. This index is similar to other trade -weighted indexes, which also use the exchange rates from the same major currencies. Past performance is no guarantee of future results. KEY TAKEAWAYS • Despite the rise in volatility across financial markets, the macroeconomic environment remains positive for risk y assets. risk of a U.S. recession at less than 50% in 2019. We see the • 13 13

14 Where are we headed? ECONOMY EQUITIES FIXED Inflation Wage growth GDP growth INCOME REAL ASSETS ALTERNATIVE INVESTMENTS CURRENCIES ASSET ALLOCATION Consumer Volatility DISCLOSURES Unemployment confidence March 31, 2019. Subject to change. Source: Wells Fargo Investment Institute, as of KEY TAKEAWAYS • Healthy hiring activity and rising wages have led to rising labor force participation. We expect the U.S. economy to continue expanding (albeit at a slower rate than in 2018) and inflation rates • to gradu ally normalize. 14 14

15 U.S. inflation is starting to meet expectations U.S. INFLATION EXPECTATIONS HOVERING AROUND 2% ECONOMY 3.2 3.0 EQUITIES 2.8 FIXED 2.6 INCOME Inflation 2.4 expectation REAL 2.2 ASSETS 2.0 ALTERNATIVE INVESTMENTS 1.8 1.6 CURRENCIES Year -over -year change (%) 1.4 Inflation 1.2 ASSET data ALLOCATION 1.0 2012 2016 2017 2018 2019 2011 2013 2014 2015 DISCLOSURES Market's 5-year/5-year forward inflation (%) PCE core deflator (%) Sources: Bloomberg and Wells Fargo Investment Institute, as of February 28, 2019. PCE deflators (or personal consumption expenditure deflators) track overall price changes for goods and services purchased by consumers. Deflators are calculated by dividing th e a ppropriate nominal series by the corresponding real series and multiplying by 100. The market’s 5- year/5 -year forward inflation rate is a common measure that is used by central banks and dealers to look at the market's future inflation expectations. KEY TAKEAWAYS • U.S. inflation increased in 2018 and is hovering near the Fed’s target of 2%. • We expect inflation (as measured by the CPI) to rise to 2.2% in 2019. 15 15

16 indicators U.S. leading Insight from LEADING ECONOMIC INDICATORS SUPPORT CONTINUED ECONOMIC GROWTH 20 ECONOMY 15 10 5 EQUITIES 0 -5 -year change (%) -10 FIXED -15 -over INCOME -20 Year -25 '60 '62 '64 '66 '68 '70 '72 '74 '76 '78 '80 '82 '84 '86 '88 '90 '92 '94 '96 '98 '00 '02 '04 '06 '08 '10 '12 '14 '16 '18 REAL ASSETS U.S. recessions Leading Economic Index ALTERNATIVE INVESTMENTS TRACKING THE COMPONENTS OF THE LEI INDICATOR -TERM TREND LONG -TERM TREND SHORT CURRENCIES Leading Economic Index Strengthening Weakening Average workweek Weakening Weakening Unemployment claims (less are better) Weakening Weakening New orders: consumer goods and materials Weakening Weakening ASSET ALLOCATION ISM New Orders Index Strengthening Weakening New orders: nondefense capital goods excluding aircraft Strengthening Strengthening Building permits Neutral Neutral DISCLOSURES S&P 500 Index Strengthening Strengthening Leading Credit Index Strengthening Strengthening Interest rate spread ( 10- year UST less federal funds) Weakening Weakening Avg. consumer expectations for business and economic conditions Strengthening Weakening Wells Fargo Investment Institute, as of February 28 Sources: Bloomberg and ® (LEI) is a , 2019. The Conference Board Leading Economic Index composite average of 10 leading indicators in the U.S. It is one of the key elements in the Conference Board's analytic system, which is designed to signal peaks and troughs in the business cycle. The ISM Manufacturing Index® is a composite index based on five indicators with equal weight . Short -term trend = current versus three- month moving average. Long -term trend = current versus 12 -month moving average. KEY TAKEAWAYS • Leading indicators can be useful for signaling future economic events, such as an economic slowdown. recession in 2019 does not • Leading indicators have slowed some but still suggest moderate growth ahead. A seem likely. 16 16

17 U.S. GDP Components of CONSUMPTION DRIVES U.S. GDP GROWTH 6 7 ECONOMY 6 5 5 EQUITIES 4 4 3 FIXED 3 INCOME 2 2 (QoQ%) 1 REAL ASSETS 1 0 0 ALTERNATIVE components -1 INVESTMENTS -1 -2 Real GDP (QoQ % SAAR) -2 CURRENCIES Real GDP -3 -3 -4 -4 ASSET ALLOCATION DISCLOSURES Government Net exports Personal consumption Fixed investment GDP Change in private inventories GDP consensus estimate Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31, 2019. Wells Fargo Investment Institute estimates. Forecasts are not guaranteed and are subject to change. GDP consensus estimates come from Bloomberg . QoQ = quarter over quarter. SAAR = seasonally adjusted annual rate. KEY TAKEAWAYS • Strength in consumer spending and potential contributions from business and government spending con tinue to support U.S. economic growth in the near term. We expect the U.S. economy to grow by 2.5% in 2019. • 17 17

18 the gains have underpinned Steady job U.S. economic recovery ECONOMY TOTAL NONFARM WORKERS AT NEW HIGH UNEMPLOYMENT AND UNDEREMPLOYMENT 155 18 16 150 EQUITIES 14 145 12 140 10 FIXED INCOME 8 Millions Rate (%) 135 6 130 4 REAL ASSETS 125 2 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 Underemployment rate Unemployment rate ALTERNATIVE INVESTMENTS JOB OPENINGS REMAIN NEAR RECORD HIGHS TOTAL EMPLOYED AS A % OF POPULATION openings and hires JOLTS survey: job CURRENCIES 66 8.0 65 SA 7.0 64 ASSET 63 6.0 ALLOCATION 62 workers 5.0 61 Percent 4.0 60 DISCLOSURES 59 3.0 58 Millions of 2.0 57 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 Hires Job openings Sources: Bloomberg and Wells Fargo Investment Institute, as of February 28 , 2019. JOLTS data as of January 31, 2018. JOLTS = Job Openings and Labor Turnover Survey. Shaded area represents a U.S. economic recession. SA = seasonally adjusted . KEY TAKEAWAYS • The employment situation remains healthy with the unemployment rate low, job openings at recovery highs, and job less claims signaling a healthy labor market. ge jobs supportive of household • We find broad evidence that the U.S. economy is generating high - and low -wa formation and housing market improvement. 18 18

19 U.S. consumer in good shape HOUSEHOLD DEBT SERVICE RATIO NEAR CONSUMER BALANCE ECONOMY ALL-TIME LOWS SHEET SUGGESTS CONSUMPTION 14 CONTINUES 13 120 EQUITIES 12 100 FIXED 11 INCOME 80 10 Debt payment as % of REAL ASSETS disposable personal income 9 60 '80 '84 '88 '92 '96 '00 '04 '08 '12 '16 ALTERNATIVE 40 INVESTMENTS HOUSEHOLD NET WORTH AT ALL- TIME Dollars (in trillions) HIGHS 20 CURRENCIES 110 0 90 ASSET ALLOCATION 70 -20 Q4 2018 50 Consumer credit DISCLOSURES Mortgages 30 Net worth in trillions ($) Other liabilities Durable goods and other nonfinancial assets 10 Real estate '90 '92 '94 '96 '98 '00 '02 '04 '06 '08 '10 '12 '14 '16 '18 Financial assets Net assets (total assets minus total liabilities) Sources: Bloomberg, , 2018. Federal Reserve Board, and Wells Fargo Investment Institute, as of December 31 KEY TAKEAWAYS • Consumer balance sheets are in much better shape today than they were a decade ago as households paid down debts post Great Recession. • Rising home prices and higher stock prices have led to a rebound in total U.S. household net worth. Total house trillion. at $104 hold net worth stands 19 19

20 consumer behavior Changing ONLINE SALES GAINING VS. TRADITIONAL RETAIL ECONOMY 600 500 EQUITIES 400 300 FIXED 200 INCOME 100 0 REAL Retail sales in billions ($) '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 ASSETS U.S. recession Retail sales E-commerce sales ALTERNATIVE INVESTMENTS LOW OIL PRICES SPUR TRUCK SALES OVER CAR SALES 160 14 ) CURRENCIES 140 12 120 100 10 ASSET 80 ALLOCATION 8 60 sales in millions 40 6 DISCLOSURES 20 4 0 Vehicle '15 '16 '14 '18 '19 '13 '12 '17 WTI crude oil ($ per barrel WTI crude oil Light truck sales Car sales Sources: Bloomberg, FactSet, and Wells Fargo Investment Institute, as of 28, 2019. E -commerce sales as of December 31, 2018. February West Texas Intermediate (WTI) is a grade of crude oil used as a benchmark in oil pricing. KEY TAKEAWAYS • Online sales are becoming a larger percentage of total retail sales. • Lower oil prices may have an impact on the types of purchases consumers are making. For example, while car truck and SUV sales have surged on lower gasoline prices. sales have been declining, 20 20

21 Housing data is mixed DEMAND IS STILL OUTPACING SUPPLY HAS PICKED UP SLOWLY SUPPLY ECONOMY 20 8,000 18 16 6,000 14 12 EQUITIES 10 4,000 8 6 4 FIXED 2,000 In thousands INCOME 2 0 0 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 REAL Ratio —number of months supply per 100,000 households ASSETS Housing inventory U.S. existing home sales SAAR Ratio —number of starts per 100,000 households ALTERNATIVE HOUSING OUTLOOK IMPROVING INVESTMENTS HOUSING AFFORDABILITY INDEX 235 2,500 80 70 215 2,000 CURRENCIES 60 195 50 1,500 175 40 155 1,000 30 ASSET Index level 135 Index level ALLOCATION 20 In thousands 500 115 10 95 0 0 DISCLOSURES '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 Housing units authorized by building permits (left axis) NAR Housing Affordability Index, composite index —U.S. NAHB/Wells Fargo Housing Market Index (right axis) as of February 28, 2019. SAAR = seasonally Sources: Bloomberg, FactSet, and Wells Fargo Investment Institute, rate. NAHB adjusted annual (National Association of Home Builders)/Wells Fargo Housing Market Index as of March 31, 2019. NAR Housing Affordability Index as of January 31, 2019. NAHB (National Association of Home Builders)/Wells Fargo Housing Market Index is a widely watched gauge of the outlook for the U.S . ® housing sector. The NAR (National Association of Realtors ) Housing Affordability Index measures whether or not a typical family could qualify for a mortgage loan on a typical home. KEY TAKEAWAYS • The housing market currently remains solid, but as prices and interest rates rise, affordability has become a concer n. Also, the recent adoption of the Tax Cuts and JOBS Act may have near -term effects on housing demand. inflation. U.S. economic growth and • Rising construction levels and home sales support moderate 21 21

22 tide for U.S. manufacturing A changing MANUFACTURING STILL EXPANDING DESPITE RECENT WEAKNESS ECONOMY 65 60 50 = EQUITIES 55 50 FIXED 45 INCOME expansion) 40 Index level (over 35 REAL ASSETS 30 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 ALTERNATIVE ISM Non-Manufacturing PMI U.S. recessions ISM Manufacturing PMI INVESTMENTS SPENDING ON PRODUCTIVE CAPACITY MAY BE RECOVERING CURRENCIES 15 10 5 ASSET ALLOCATION 0 -5 -10 year change (%) DISCLOSURES -15 -20 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Recessions Capacity utilization Industrial production Year -over- Sources: Bloomberg, Institute for Supply Management, FactSet, and Wells Fargo Investment Institute, as of March 31, 2019. The Institute for ® five indicators with equal weights. The ISM Non -Manufacturing is a composite index based on Supply Management (ISM) Manufacturing Index ® is a composite index based on weights. four indicators with equal Index KEY TAKEAWAYS • The ISM Manufacturing Index has softened recently in an environment of growing geopolitical uncertainty. Increased spending on productive capacity could foster future gains in productivity, a positive sign for wages • and cor porate earnings. 22 22

23 Higher profits usually lead to hiring RECENT EARNINGS RECESSION OVER; PROFIT MARGINS REMAIN STRONG ECONOMY 15 60 10 40 EQUITIES 5 20 0 0 FIXED INCOME -5 -20 Profit margins (%) Percent change (YoY) -10 -40 3Q00 3Q01 3Q02 3Q03 3Q04 3Q05 3Q06 3Q07 3Q08 3Q09 3Q10 3Q11 3Q12 3Q13 3Q14 3Q15 3Q16 3Q17 3Q18 REAL ASSETS Earnings recession Recessions U.S. corporate profits (YoY) U.S. corporate investment (YoY) U.S. large-cap profit margins ALTERNATIVE INVESTMENTS HIRING MAY CONTINUE DESPITE LOWER EARNINGS TYPICAL OF MID-LATE CYCLE 10 75 CURRENCIES 8 55 6 35 4 15 2 ASSET ALLOCATION 0 -5 -2 -25 -4 DISCLOSURES -45 -6 S&P EPS YoY growth (%) Nonfarm payroll YoY growth (%) S&P EPS growth (YoY)—LHS Recession Nonfarm payrolls (YoY)—RHS Sources: Bloomberg, Bureau of Economic Analysis, U.S. Department of Commerce, and Wells Fargo Investment Institute. Top chart as of December 31, 2018. Bottom chart as of March 31, 2019. EPS = earnings per share. KEY TAKEAWAYS • Although corporate earnings growth has hit its late cycle peak, profit margins continue to remain strong. Solid earnings growth should keep hiring at a healthy pace into 2019. • 23 23

24 labor over capital favoring Companies CAPITAL SPENDING ECONOMY GROWTH IS RISING WAGE 5 140 4 (QoQ) EQUITIES 90 3 40 FIXED INCOME 2 -10 1 Percent change -60 3 month moving average REAL Wage growth YoY (%) '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 ASSETS 0 Recessions Commercial and health care '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 Manufacturing Mining, exploration, shafts, and wells ALTERNATIVE INVESTMENTS LOW WAGES/EARNINGS = MORE JOBS JOB OPPORTUNITIES DEPEND ON EDUCATION 6 0.66 CURRENCIES 4 0.64 15 2 0.62 10 ASSET income 0 0.60 ALLOCATION 5.3% 5 3.8% -2 0.58 3.2% 2.2% Unemployment rate (%) corporate Job growth YoY (%) -4 0.56 0 DISCLOSURES Ratio of compensation to '17 '19 '11 '07 '08 '09 '10 '18 '12 '13 '14 '15 '16 -6 0.54 Less than a high school diploma High school graduates, no college Some college or associate degree Job growth (right axis) Compensation/corporate income (left axis) Bachelor's degree and higher Sources: Bloomberg, Bureau of Economic Analysis, Bureau of Labor Statistics, FactSet, and Wells Fargo Investment Institute. Wage growth as of February 28, 2019. Compensation/corporate income and c apital spending as of December 31, 2018. Job growth and unemployment rate as of March 31, 2019. Shaded area represents time frame of a U.S. economic recession. KEY TAKEAWAYS • Since the recession, companies have been steadily hiring workers but have inconsistently invested in capital . • Workers with specific skills and higher educational levels fared better during the recession and currently hav . e very low levels of unemployment 24 24

25 Confidence builds despite uncertainty CONSUMER AND BUSINESS CONFIDENCE IMPROVING 140 115 NFIB Small Business Optimism ECONOMY 130 110 120 110 Consumer confidence 105 Index level 100 Average: 80 EQUITIES 100 90 80 95 70 FIXED NFIB small business 60 INCOME 90 Confidence Index level Average: 94 50 Conference Board Consumer 85 40 '19 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 REAL ASSETS Conference Board Consumer Confidence 12-month moving average Consumer confidence 10-year average NFIB Small Business Optimism 12-month moving average Small business 10-year average ALTERNATIVE INVESTMENTS ECONOMIC UNCERTAINTY IS STARTING TO CLIMB CURRENCIES 225 175 Average = 91 Average = 89 ASSET ALLOCATION 125 Index value 75 DISCLOSURES Average = 129 Average = 113 25 1993 2017 2015 1999 2013 2011 2009 2007 1985 1987 1989 1991 2005 1995 1997 2003 2001 2019 U.S. Economic Policy Uncertainty Index (3-month moving average) Sources: The Conference Board; National Federation of Independent Business (NFIB); Economic Policy Uncertainty Index—Baker, Bloom, and Davis; Bloomberg; and Wells Fargo Investment Institute, as of March 31, 2019. NFIB Small Business Optimism as of February 28, 2019. Shaded area represents a U.S. economic recession. The Consumer Confidence Index (CCI) tracks sentiment among households or consumers. The NFIB Small Business Index tracks the general state of the economy as it relates to businesses. KEY TAKEAWAYS • Coming out of the last recession, small-business owners were most concerned about poor sales and least concerned about labor quality. Today, those concerns have reversed. • Consumer and business confidence have suffered recently as domestic issues like the U.S. government shutdown and global geopolitical concerns weigh on sentiment. 25 25

26 Equities highlights ECONOMY General • Since the Christmas Eve lows in the major equity indices, stocks have marched EQUITIES higher, largely erasing the December plunge, with few pauses. • We expect periods of market uncertainty in the near term, but realize that FIXED INCOME volatility can often present opportunities for investors. REAL Domestic ASSETS • Major U.S. equity indices surged higher in the New Year. ALTERNATIVE INVESTMENTS • We expect greater volatility in 2019, but record high earnings should help buffer term uncertainties to some extent. near- CURRENCIES nings improvements, U.S. equity prices appear fairly Adjusting for tax-related ear • ASSET valued at current levels. ALLOCATION The current bull market is the longest in the history of the S&P 500 Index. • DISCLOSURES • In general, we currently favor the more cyclical sectors that are sensitive to the and flow of the domestic economy. ebb International • Looking ahead, earnings growth could push the MSCI EM Index higher. Our analysis continues to suggest that emerging markets offer the highest • ntial returns this year. pote 26 26

27 Equity scorecard P/E Dividend YoY YTD 1Q19 ECONOMY Asset class return return yield return 20-year 20-year Current (%) (%) (%) (%) median average EQUITIES U.S. Large Cap 13.65 18.02 1.94 19.08 18.69 13.65 9.50 Equities FIXED INCOME U.S. Mid Cap 1.98 21.42 6.47 16.54 16.54 21.93 20.98 Equities REAL ASSETS U.S. Small Cap ALTERNATIVE 37.24 41.73 1.49 42.04 14.58 14.58 2.05 Equities INVESTMENTS Developed Market CURRENCIES 10.13 3.54 10.13 18.06 -3.22 25.18 15.30 Ex-U.S. Equities ASSET Emerging Market ALLOCATION 2.71 9.97 9.97 -7.06 13.02 14.40 13.34 Equities DISCLOSURES Frontier Market 6.90 6.90 -14.81 10.65 – – 3.64 Equities Sources: Bloomberg, Morningstar Direct, and Wells Fargo Investment Institute, as of March 31, 2019. YoY = year over year. YTD = year to date. For illustrative purposes only. Large cap = S&P 500 Index. Mid cap = Russell Midcap Index. Small cap = Russell 2000 Index. Developed market Ex-U.S. = MSCI EAFE Index. Emerging market = MSCI Emerging Markets Index. Frontier market = MSCI Frontier Markets Index. P/E = price/earnings. Yields represent past performance and fluctuate with market conditions. Current yields may be higher or lower than those quoted. An ind ex is unmanaged and not available for direct investment . Past performance is no guarantee of future results . KEY TAKEAWAYS • Volatility picked up in recent months, but stocks have largely gained back all the ground lost in the December plunge. YTD in 2019 stocks have surged higher with few pauses. Emerging markets offer the best potential returns over the balance of 2019 in our opinion. • 27 27 *Note: March 2009 to June 2009 P/Es for small cap have been removed due to their outlier condition.

28 aluations -looking v Forward FORWARD VALUATIONS ARE NEAR LONGER -TERM AVERAGES ECONOMY 30 EQUITIES 25 FIXED INCOME 20 REAL ASSETS P/E ratio Average = 15.4x 15 ALTERNATIVE INVESTMENTS Average = 14.3x CURRENCIES Average = 11.0x 10 ASSET ALLOCATION 5 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 DISCLOSURES U.S. recessions S&P 500 Index: 15.4x MSCI EAFE Index (developed markets): 14.3x MSCI Emerging Markets Index: 11.0x Sources: FactSet and Wells Fargo Investment Institute, as of ratios represent the total price March 31, 2019. For illustrative purposes only. P/E of the index divided by its total earnings. The S&P 500 Index is a market -capitalization -weighted index considered representative of the U.S. stock market. The MSCI EAFE Index and the MSCI Emerging Markets Index are equity indices that capture large- and mid- cap representation across 21 developed -market countries (excluding the U.S. and Canada) and 24 emerging -market countries, respectively, around the world. An index is unmanaged and not available for direct investment. Past performance is no guarantee of future results. KEY TAKEAWAYS • Adjusting for tax- related earnings benefits, U.S. equities appear fairly valued. and Fed monetary policies. forecasts, • Investors are focused on trade negotiations, earnings 28 28

29 ates rising r during periods of Returns PERFORMANCE OF STOCKS AND BONDS IN RISING RATE ENVIRONMENTS 45 42.6 ECONOMY 40 35 EQUITIES 30 FIXED INCOME 25 20 REAL ASSETS 14.8 Return (%) 15 12.7 10.5 ALTERNATIVE 10 INVESTMENTS 6.8 6.6 3.7 3.3 5 2.8 CURRENCIES 0.0 0 -0.5 -1.4 -1.7 -2.4 -2.7 -2.8 -5 ASSET -3.7 -3.7 ALLOCATION -10 11/8/2001 – 9/8/2017– 6/14/2003 – 7/9/2016– 3/16/2004 – – 6/25/2005 – 7/25/2012 12/31/2008– – 10/8/2010 DISCLOSURES 4/1/2002 6/9/2004 12/31/2013 9/2/2003 3/14/2017 6/28/2006 2/21/2018 6/10/2009 2/9/2011 S&P 500 Index Bloomberg Barclays U.S. Aggregate Bond Index Sources: Morningstar Direct and Wells Fargo Investment Institute, as of December 31 , 2018. For illustrative purposes only. Past performance is no guarantee of future results. There is no guarantee any asset class will An index is unmanaged and not available for direct investment. perform in a similar manner in the future or in other rising rate environments. A rising rate environment is defined by a 100 basis point increase in the 10 year U.S. Treasury yield. (100 basis points equal 1%.) Both stocks and bonds involve risk, and their returns and risk levels can vary depending on prevailing market and economic conditions. Bond prices fluctuate inversely to changes in interest rates. KEY TAKEAWAYS rising. bonds while interest rates are • Historically, U.S. stocks have outperformed 29 29

30 Volatility spiked during uncertain times MARKETS HAVE MOVED TOGETHER WHEN VOLATILITY SPIKES ECONOMY 100 EQUITIES 90 Financial 80 crisis FIXED INCOME 70 9/11 and Iraq War U.S. debt 60 downgrade REAL ASSETS 50 Fed rate hike Index level ALTERNATIVE 40 INVESTMENTS Trade war concerns 30 CURRENCIES 20 10 ASSET ALLOCATION 0 2011 2010 2012 2000 2013 2014 2015 2016 2017 2018 2019 2001 2002 2003 2004 2005 2006 2007 2008 2009 DISCLOSURES U.S. recessions S&P 500 volatility Euro Stoxx 50 volatility Hong Kong Hang Seng volatility Nikkei volatility Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31, 2019. For illustrative purposes only. S&P 500 volatility measured ® ® by the CBOE Volatility Index (VIX ). Euro STOXX 50 volatility measured by the VSTOXX Index. Hong Kong Hang Seng volatility measured by the HSI Volatility Index. Nikkei volatility measured by the VNKY Index. An index is unmanaged and not available for direct investing. Past performance is no guarantee of future results. KEY TAKEAWAYS • Since the financial crisis, global equity markets have experienced periodic spikes in volatility due to a number of factors. We expect periods of market uncertainty in the coming year, but investors should realize that volatility can • often present opportunities. 30 30

31 Equity sector compositions have changed over time ECONOMY q SCI EM Index S&P 500 Index M MSCI EAFE Index Sectors Weights 2013 2018 1997 2013 2018 1997 2013 2018 1997 EQUITIES Information Technology 5.96% 16.00% 14.27% 0.58% 13.28% 18.63% 20.12% 4.90% 4.52% Health Care 10.02% 11.04% 12.95% 15.54% 8.00% 11.17% – 1.67% 2.82% FIXED INCOME Financials 13.31% 24.78% 15.13% 16.18% 26.64% 26.64% 25.63% 19.49% 26.25% Communication Services 4.97% 14.11% 6.22% 2.30% 10.12% 7.38% 5.69% 5.55% 14.94% REAL ASSETS Consumer Discretionary 9.94% 11.93% 10.42% 8.89% 16.38% 13.26% 11.23% 11.41% 12.54% Industrials 13.40% 6.49% 12.38% 10.94% 9.20% 5.51% 12.92% 14.31% 17.23% ALTERNATIVE Consumer Staples INVESTMENTS 9.76% 13.03% 7.41% 6.95% 10.93% 11.57% 8.96% 8.65% 6.71% Energy 11.24% 0.56% 9.00% 10.28% 5.32% 5.32% 6.84% 5.86% 7.92% CURRENCIES Utilities 2.74% 2.92% 3.34% 5.36% 3.51% 3.76% 11.46% 3.35% 3.12% Real Estate – – – 2.96% – 3.03% 3.72% – – ASSET Materials 8.02% 5.38% 3.50% 2.73% 8.06% 7.37% 6.76% 9.69% 7.68% ALLOCATION Sources: Bloomberg and Wells Fargo Investment Institute, as of December 31, 2018. The Telecommunications Services sectors was replaced with DISCLOSURES the Communications Services sector on September 28, 2018. The composition of the indexes in 1997 and 2013 still reflect the prior sector composition. An index is unmanaged and not available for direct investment. KEY TAKEAWAYS • The Information Technology sector weight has increased in all three indices above—but most significantly in emerging markets. We expect less volatility in earnings from emerging markets due to this. • 31 31

32 Market resilience U.S. MARKETS HAVE DISPLAYED RESILIENCE DESPITE UNCERTAIN EVENTS ECONOMY Fed Policy Uncertainty 3,200 & Political Risks Recessions December 2018 $787 billion stimulus EQUITIES package approved U.S. tax reform February 2009 1,600 December 2017 FIXED INCOME Fiscal cliff January 2013 800 Stock market crash REAL World Trade Center/ October 1987 ASSETS Pentagon attacks President Nixon resigns U.S. debt September 2001 August 1974 downgrade August 2011 ALTERNATIVE 400 INVESTMENTS Oklahoma City bombing Robert F. Kennedy shot Iran hostage crisis April 1995 CURRENCIES June 1968 November 1979 TARP passed October 2008 200 ASSET Martin Luther King Jr. shot ALLOCATION S&P 500 Price Index level (log scale) April 1968 100 Federal Reserve tightened money Stagflation DISCLOSURES Gulf War The Vietnam War Iraq War 50 '65 '67 '69 '71 '73 '75 '77 '79 '81 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07 '09 '11 '13 '15 '17 '19 Sources: Wells Fargo Investment Institute, Bloomberg, and Ned Davis Research, as of March 31, 2019. For illustrative purposes only. A price index is not a total return index and does not include the reinvestment of dividends. An index is unmanaged and not available for direct investment. Past performance is no guarantee of future results. There is no guarantee equity markets will perform similarly during other periods of uncertainty. All investing involves risk including the possible loss of principal. KEY TAKEAWAYS • Market uncertainty is a fact of life, and volatility is a normal part of market behavior. 32 32

33 course Staying the A CORRECTION IS NO REASON TO EXIT THE MARKET 50% ECONOMY 38% 33% 33% 32% 32% 32% 30% 29% 29% EQUITIES 26% 30% 23% 23% 22% 22% 21% 19% 17% 16% 16% 15% 14% FIXED 12% 11% 10% INCOME 8% 6% 10% 5% 5% 5% 2% 1% 1% REAL ASSETS -3% -3% -3% -4% -3% -5% -10% -4% -5% -6% -6% -6% -9% -7% -7% -7% -7% -7% -7% -7% -7% -8% -8% -9% -10% -10% -10% -10% -12% -11% -12% ALTERNATIVE -12% -12% -14% INVESTMENTS -16% -17% -19% -19% -19% -19% -22% -30% -27% CURRENCIES -29% -30% -33% -37% -50% ASSET -48% ALLOCATION DISCLOSURES -70% '80 '81 '82 '83 '84 '85 '86 '87 '88 '89 '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 Calendar-year S&P 500 drawdown Calendar-year S&P 500 total return Sources: Morningstar Direct and Wells Fargo Investment Institute, as of December 31, 2018. For illustrative purposes only. Severe intra -year of the S&P 500 Total corrections do not necessarily indicate subpar performance for the calendar year. Analysis was compiled using the daily price Return Index. Calendar -year drawdowns represent the largest market drops from peak to trough for each year. An index is unmanaged and not available for direct investment . Past performance is no guarantee of future results. All investing involves risk including the possible loss of principal. KEY TAKEAWAYS • Market corrections, albeit painful for some, can offer opportunities for investors to purchase high-quality stock s at reasonable prices . We define a bear market as one that closes • There have been two 19% corrections during this bull market. down 20% from its prior peak. 33 33

34 Room to run? ECONOMY BY OUR MEASURES THIS BULL IS THE LONGEST ON RECORD 500% EQUITIES -return bull market A larger circle represents a higher 1990 –2000 450% 417% FIXED 400% INCOME 1932 –1937 350% 1949 –1957 319% REAL 324% ASSETS 300% 267% ALTERNATIVE 250% 229% Current INVESTMENTS 1982 –1987 (March 2009–present) 200% 1942 –1946 177% Average CURRENCIES Bull market price return 158% 150% 1974 –1980 126% 1970– 74% 1973 ASSET 100% 102% ALLOCATION 86% 80% 2002– 2007 65% 48% 50% 1957 –1961 1962 –1966 1966 – DISCLOSURES 1987 –1990 1968 0% 100 120 0 20 40 60 80 ) Bull market length (months Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31, 2019. Market represented by the S&P 500 Index . For illustrative purposes only. An index is unmanaged and not available for direct investment . Past performance is no guarantee of future results . A price index is not a total return index and does not include the reinvestment of dividends. KEY TAKEAWAYS • The current recovery has surpassed the return and duration of the average bull market and now has become the longest bull market in history. 34 34

35 Markets may exhibit seasonality CYCLICAL STOCKS TEND TO PERFORM BEST IN THE WINTER, ECONOMY DEFENSIVE STOCKS IN THE SUMMER 2018 3.0 – 2.5 2.0 EQUITIES 1.5 1.0 (%) 0.5 FIXED INCOME 0.0 -0.5 -1.0 REAL -1.5 ASSETS Average monthly change 1989 February March May June July August September October November December January April Cyclical Defensive ALTERNATIVE INVESTMENTS 12-month Index name % weight QTD % change YTD % change Dividend yield % forward P/E 100.0 13.65 13.65 17.1 2.00 S&P 500 CURRENCIES Cyclical Consumer Discretionary 10.2 15.73 15.73 21.41 1.36 Defensive Consumer Staples 7.3 12.01 12.01 19.14 2.95 Defensive 16.43 Energy 3.36 18.88 5.4 16.43 ASSET Cyclical Financials 12.7 8.56 8.56 11.51 2.28 ALLOCATION Defensive Health Care 14.6 6.59 6.59 16.01 1.74 Cyclical Industrials 17.20 17.20 16.01 1.99 9.5 Cyclical Information Technology 21.2 19.86 19.86 19.26 1.54 DISCLOSURES Cyclical Materials 2.6 10.30 10.30 16.21 1.91 Cyclical Real Estate 17.53 17.53 43.5 3.26 3.1 Defensive 10.1 13.97 13.97 17.81 1.44 Communication Services Defensive Utilities 3.3 10.84 10.84 18.81 3.37 Sources: FactSet, Morningstar Direct, S&P Capital IQ, and Wells Fargo Investment Institute. Top chart: Cyclical and defensive stocks according to the month of the year as of December 31, 2018. Bottom table as of March 31, 2019. QTD = quarter to date. P/E = price/earnings. For illustrative purposes only. Yields represent past performance and fluctuate with market conditions. Current yields may be higher or lower than those quoted above. An index is unmanaged and not available for direct investment. Past performance is no guarantee of future results. KEY TAKEAWAYS • The January through April period historically has favored equities and cyclical holdings (over defensive ones) more than the June through mid-October period. We currently favor the more cyclical sectors that are sensitive to the ebb and flow of the domestic economy. • 35 35

36 International regional views on equity markets ECONOMY EQUITIES FIXED INCOME REAL ASSETS ALTERNATIVE INVESTMENTS CURRENCIES ASSET ALLOCATION DISCLOSURES Emerging markets Developed markets ex U.S. Favorable Neutral Emerging Europe, Middle East, Africa Europe Most Favorable Favorable Emerging Asia Pacific Australia, Hong Kong, Japan, Latin America Singapore Source: Wells Fargo Investment Institute, as of March 31, 2019. KEY TAKEAWAYS • We hold a neutral view on Europe, while we favor Pacific developed markets based on improving international trade and earnings fundamentals. Our Most Favorable and Favorable ratings across the emerging market regions reflects improving economic • and e arnings fundamentals. 36 36

37 International markets: bulls and bears MSCI EAFE Index, Dec. 1993–Mar. 2019 300 Returns Duration— Returns— — 250 ECONOMY Bull start Bull end months annualized total 200 Dec-93 Mar-00 76 107% 12% 150 EQUITIES Mar-03 55 Oct-07 28% 205% Index level 100 68% 27% Apr-11 26 Feb-09 FIXED 50 INCOME 50% May-12 Jun-14 22% 25 0 11% – Feb-16 40% 37 '08 '06 '12 '04 '16 '18 '10 '14 '02 '00 '98 '94 '96 REAL ASSETS 20% Average 44 94% MSCI EAFE bear market MSCI EAFE bull market ALTERNATIVE 800 MSCI EM Index, Jan. 1991–Mar. 2019 INVESTMENTS 700 Duration— Re Returns— turns— 600 total months Bull end Bull start annualized CURRENCIES 500 39% Jan-91 Sep-94 44 233% 400 31% Aug-98 Feb-00 17 49% 300 Index level ASSET ALLOCATION 200 428% 44% Mar-03 Oct-07 55 100 42% 118% 26 May-11 Feb-09 DISCLOSURES 0 '13 '17 '19 '91 '93 '95 '97 '15 '01 '03 '05 '07 '09 '11 '99 Jan-16 Jan-18 24 94% 39% MSCI EM bear market MSCI EM bull market Average 184% 39% 33 Sources: Bloomberg, Morningstar Direct, and Wells Fargo Investment Institute, as of March 31, 2019. For illustrative purposes only. The MSCI EAFE Index and the MSCI Emerging Markets Index are equity indices that capture large- and mid-cap representation across 21 developed market countries (excluding the U.S. and Canada), and 24 emerging market countries, respectively, around the world. An index is unmanaged and not available for direct investment. Past performance is no guarantee of future results. KEY TAKEAWAYS • International bull markets have become shorter in duration and more frequent than before. 37 37

38 Developed market divergence OTHER DEVELOPED MARKET EQUITIES HAVE LAGGED U.S. EQUITIES 220 ECONOMY 200 180 160 EQUITIES 140 120 100 FIXED INCOME 80 60 40 REAL 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Index level (1/1/2007=100) ASSETS S&P 500 Index MSCI EAFE Index ALTERNATIVE INVESTMENTS 200 CURRENCIES 150 share 100 ASSET ALLOCATION 50 DISCLOSURES Earnings per 0 2012 2009 2010 2011 2013 2014 2015 2016 2017 2018 2019 2007 2008 S&P 500 Index EPS MSCI EAFE Index EPS Wells Fargo Investment Institute , as of March 31, 2019. EPS = earnings per share. Sources: Bloomberg and For illustrative purposes only. The MSCI EAFE Index is an equity index which captures large - and mid -cap representation across developed market countries around the world, excluding the U.S. and Canada. The S&P 500 Index is a market- capitalization -weighted index considered representative of the U.S. stock market. An index is unmanaged and not available for direct investment. is no guarantee of future results . Past performance KEY TAKEAWAYS • The performance of developed market equities, excluding the U.S. (MSCI EAFE Index) and U.S. equity per formance, began to diverge in 2012. . Looking ahead, earnings growth could push the MSCI EAFE Index higher • 38 38

39 market earnings recovery Emerging ARE RISING EMERGING MARKET EARNINGS ECONOMY 220 200 180 EQUITIES 160 140 120 FIXED 100 INCOME 80 60 REAL 40 ASSETS Index level (1/1/2007=100) 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 S&P 500 Index MSCI Emerging Markets Index ALTERNATIVE INVESTMENTS 160 CURRENCIES 140 120 100 ASSET ALLOCATION 80 60 DISCLOSURES Earnings per share 40 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 S&P 500 Index EPS MSCI Emerging Markets Index EPS Bloomberg and Wells Fargo Investment Sources: March 31, 2019. EPS = earnings per share. For illustrative purposes only. The Institute, as of MSCI Emerging Markets Index is a free- float -adjusted market -capitalization -weighted index designed to measure equity market perf ormance of emerging markets. The S&P 500 Index is a market -weighted index considered representative of the U.S. stock market. An index -capitalization is unmanaged and not available for direct investment. Past performance is no guarantee of future results . KEY TAKEAWAYS • Since 2017, emerging market earnings have improved steadily. We continue to recommend seeking opportunities in emerging markets, particularly emerging Asia. • 39 39

40 Fixed-income highlights ECONOMY General Yields have risen from cycle lows as rates rise globally. • EQUITIES Yields a • vailable in many segments of the bond market are still materially lower than investors have historically experienced. FIXED INCOME Domestic REAL ASSETS lds have ticked lower on global growth concerns. U.S. bond yie • Although t • he U.S. Treasury yield curve continues to flatten, we do not see this ALTERNATIVE INVESTMENTS foreshadowing a near-term economic downturn. CURRENCIES • We believe that unless the curve inverts below 25 basis points or the inversion ersists, the economy is likely to continue growing. p ASSET ALLOCATION yield corporate bond spreads have tightened. Currently, we see little risk- • High- adjusted value in this asset class. DISCLOSURES International overnment bond yields continue to decline as economic • Developed market g growth and deflationary concerns resurface in the Eurozone. 40 40

41 Fixed-income scorecard 1Q19 YTD YoY Duration Yield (%) Asset class ret return return urn ECONOMY ars) (ye (%) (%) (%) U.S. Short Term EQUITIES 3.05 2.76 1.83 1.22 1.22 Taxable Fixed Income FIXED U.S. Intermediate INCOME Term Taxable Fixed 4.51 3.27 4.79 2.59 2.59 Income REAL ASSETS U.S. Long Term 6.45 4.07 5.37 6.45 15.18 Taxable Fixed Income ALTERNATIVE INVESTMENTS High Yield Taxable 7.26 8.00 3.33 7.26 5.93 Fixed Income CURRENCIES Developed Market ex.- 0.98 9.44 1.56 1.56 -4.40 ASSET U.S. Fixed Income ALLOCATION Emerging Market Fixed DISCLOSURES 7.06 6.59 6.59 3.52 7.04 Income Sources: FactSet, Morningstar Direct, and Wells Fargo Investment Institute, as of March 31, 2019. YoY = year over year. YTD = year to date. For illustrative purposes only. Bloomberg Barclays U.S. Aggregate 1–3 Year Bond Index, Bloomberg Barclays U.S. Aggregate 5–7 Year Bond Index, Bloomberg Barclays U.S. Aggregate 10+ Year Bond Index, Bloomberg Barclays U.S. Corporate High Yield Bond Index, J.P. Morgan Global Ex U.S. Index (Unhedged), J.P. Morgan EMBI Global Index (USD). Yields and returns represent past performance and fluctuate with market conditions. Current performance may be higher or lower than that quoted above. Past performance is no guarantee of future results. An index is unmanaged and not available for direct investment. KEY TAKEAWAYS • International developed market bonds and shorter-term U.S. fixed income securities have underperformed year to date. • Longer-term U.S. bonds have outperformed shorter-term issues as the Fed paused its interest rate hike cycle. • We currently favor U.S. fixed income over other developed markets, along with moving up in credit quality. We 41 also favor short-term bonds over long-term fixed income.

42 Yields have surpassed cycle lows SHORTER-TERM YIELDS HAVE RISEN THE MOST FROM CYCLE LOWS ECONOMY 7 6.43% 6.21% EQUITIES 6 FIXED 4.83% INCOME 5 4.44% REAL 4 ASSETS 3.69% 3.14% 2.95% 3 ALTERNATIVE Yields (%) 2.47% INVESTMENTS 2 1.61% CURRENCIES 0.76% 1 0.45% 0.40% ASSET ALLOCATION 0 Short Term Fixed Income Intermediate Term Fixed Long Term Fixed Income High Yield Fixed Income Developed Market Fixed Emerging Market Fixed Income Income Income DISCLOSURES Current (3/29/19) Cycle low Sources: Bloomberg, FactSet, and Wells Fargo Investment Institute, as of March 31, 2019. For illustrative purposes only. Bloomberg Barclays U.S. Aggregate 1–3 Year Bond Index, Bloomberg Barclays U.S. Aggregate 5–7 Year Bond Index, Bloomberg Barclays U.S. Aggregate 10+ Year Bond Index, Bloomberg Barclays U.S. Corporate High Yield Bond Index, J.P. Morgan Global Ex U.S. Index (Unhedged), J.P. Morgan EMBI Global Index (USD). Yields represent past performance and fluctuate with market conditions. Current yields may be higher or lower than those quoted above. An index is unmanaged and not available for direct investment Past performance is no guarantee of future results. KEY TAKEAWAYS • Yields have risen from cycle lows as rates rise globally. Yields are still materially lower than investors have historically experienced. • 42

43 Developed market yields have declined ECONOMY -YEAR HIGHS ABOVE FIVE U.S. YIELDS ARE 3.5 EQUITIES 3.0 FIXED INCOME 2.5 REAL 2.0 ASSETS 1.5 ALTERNATIVE Yield (%) INVESTMENTS 1.0 CURRENCIES 0.5 ASSET 0.0 ALLOCATION -0.5 DISCLOSURES Japan government 10-year bond German government 10-year bond United Kingdom 10-year bond U.S. 10-year Treasury Five-year average Current (12/31/2018) Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31, 2019. For illustrative purposes only. Yields represent past performance and fluctuate with market conditions. Current yields may be higher or lower than those quoted above. Past performance is no guarantee of future results. KEY TAKEAWAYS • Developed market government bond yields continue to decline as economic growth and deflationary concerns resur face in the Eurozone. U.S. bond yields ticked higher while the Fed raised interest rates. • 43

44 tightening cycle Yield curve and the U.S. TREASURY RECENT YIELD CURVE AT THE START AND END ECONOMY YIELD CURVE TIGHTENING CYCLE OF 1992–1995 3.5 8 3.0 EQUITIES 7 2.5 2.0 6 1.5 FIXED Yield (%) Yield (%) INCOME 1.0 5 0.5 4 0.0 0 5 30 15 25 20 10 REAL 25 30 0 5 10 15 20 ASSETS maturity Years to maturity Years to As of 2/1/1995 As of 2/4/1992 As of 12/17/2015 As of 3/29/2019 ALTERNATIVE INVESTMENTS YIELD CURVE AT THE START AND END OF YIELD CURVE AT THE START AND END 1999–2000 TIGHTENING CYCLE OF 2004–2006 TIGHTENING CYCLE CURRENCIES 6 7.0 6.5 5 6.0 ASSET 4 ALLOCATION 5.5 3 Yield (%) Yield (%) 5.0 2 4.5 DISCLOSURES 1 4.0 15 10 5 0 30 25 20 10 5 30 25 20 15 0 Years to maturity maturity Years to As of 6/30/2004 As of 6/30/2006 As of 5/16/2000 As of 6/30/1999 Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31, 2019. For illustrative purposes only. Yields represent past performance and fluctuate with market conditions. Current yields may be higher or lower than those quoted above. Past performance is no guarantee of future results is a curve on a graph in which the yield of fixed -interest securities is plotted against the length of . A yield curve time they have to run to maturity. KEY TAKEAWAYS • Yield curves tend to flatten/invert at the end of a tightening cycle . • A steep interest rate curve often foreshadows a period of accelerating economic growth, while a flattening inte rest rate curve is a harbinger of declining growth. • Although the U.S. Treasury yield curve has flattened, we do not see this foreshadowing a near- term 44 econom ic downturn.

45 Yield curve flattening but no recession -YEAR U.S. TREASURY YIELDS 1 YEAR AND YIELD CURVE STEEPNESS: DIFFERENCE BETWEEN 10- 400 ECONOMY 300 200 EQUITIES 100 0 -100 FIXED INCOME -200 Spread (in basis points) -300 2013 2009 2005 2001 1985 2017 1977 1981 1997 1989 1993 REAL ASSETS DOT PLOT: FED EXPECTS ONE MORE HIKE IN 2020 ALTERNATIVE 5.0 INVESTMENTS 4.5 4.0 CURRENCIES 3.5 3.0 Yield (%) 2.5 ASSET ALLOCATION 2.0 1.5 Longer Term 2021 2020 2019 DISCLOSURES Median 2.750 2.625 2.375 2.625 Target federal funds rate -setting body within the Fed) Note: The dot plot shows the projections of the 16 members of the Federal Open Market Committee (the rate . Each dot federal funds rate should be at the end of the various calendar years shown as well as in the long run. represents a member’s view on where the , and Wells Fargo Investment Institute, as of March 31, 2019. For illustrative purposes only. Ten -Year Treasury Sources: Federal Reserve Board, Bloomberg tant Maturity and the Two -Year Constant Maturity Indexes are published by the Federal Reserve Board and are based on the ave rage yield of a range of Cons Treasury securities, all adjusted to the equivalent of a 10 -year maturity and the equivalent of a two -year maturity. Shaded area represents time frame of a U.S. economic recession. Yields represent past and fluctuate with market conditions. Current yields may be higher or lower than those quoted above. Past performance performance is no guarantee of future results. 100 basis points equals 1%. KEY TAKEAWAYS • The yield curve historically has inverted (short -term rates higher than long -term rates) before a recession. The curve remains positively sloped, but inverted briefly during the first quarter. We believe that unless the curve inverts by a greater magnitude or the inversion persists, the economy is likely to continue growing. • The Fed held interest rates steady at its March 2019 meeting. The revised dot plot implies no rate increases in 2019 . We expect that the rate hike cycle has come to an end. . Our current outlook is for no increases in 2019 45

46 Opportunity in muni bonds MUNICIPAL BONDS LOOK ATTRACTIVE 4.2 ECONOMY 3.8 3.4 (%) 3.0 2.6 EQUITIES 2.2 1.8 Yield to worst 1.4 FIXED INCOME 1.0 Jan-19 Oct-18 Jul-18 Apr-18 Jan-17 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Jan-18 Apr-17 Jul-17 Oct-17 U.S. Investment Grade Fixed Income U.S. Municipal Fixed Income U.S. Municipal Tax Equivalent Yield REAL ASSETS INVESTMENT -GRADE SECTORS MUNICIPAL SECTORS ALTERNATIVE BY MARKET VALUE BY MARKET VALUE INVESTMENTS 3% Electric 13% CURRENCIES Hospital 15% U.S. Treasury 31% 7% Industrial revenue 39% Transportation Government-related ASSET 6% 9% ALLOCATION Education Corporate Water and sewer 13% DISCLOSURES Leasing Securitized 24% 24% 6% Special tax 10% Other Sources: Bloomberg Barclays, FactSet, and Wells Fargo Investment Institute, as of March 31, 2019. For illustrative purposes only. Investment grade represented by Bloomberg Barclays U.S. Aggregate Bond Index, and municipal represented by Bloomberg Barclays Municipal Bond Index. Yields represent past performance and fluctuate with market conditions. Current yields may be higher or lower than those quoted abov e. Past performance is no guarantee of future results. An index is unmanaged and not available for direct investment. KEY TAKEAWAYS • We believe the new tax law could create an opportunity for outperformance of municipal bonds as demand rises . Tax equivalent yield assumes a 20 % effective tax rate. Yield to worst is the lowest potential yield that can be received on a bond without the . issuer actually defaulting 46

47 High- yield muni bonds are steady HIGH -YIELD CORPORATES ARE MORE VOLATILE 10.5 9.5 ECONOMY (%) 8.5 7.5 EQUITIES 6.5 Yield to worst 5.5 FIXED INCOME 4.5 Jan-19 Oct-18 Apr-18 Jan-18 Jul-18 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 High-yield municipal High-yield corporate REAL ASSETS CORPORATE HIGH -YIELD MARKET HIGH -YIELD MUNICIPAL SECTORS ALTERNATIVE MAY BE MORE LIQUID DUE TO SIZE BY MARKET VALUE INVESTMENTS 1,600,000 1,400,000 9% 4% Industrial revenue CURRENCIES 1,200,000 23% 1,000,000 Health care 7% 800,000 Special tax 600,000 ASSET 8% ALLOCATION 400,000 Tobacco Market size ($M) 200,000 19% Education 13% 0 DISCLOSURES General obligation 17% Jan-19 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 Housing High-yield municipal High-yield corporate Other Wells Fargo Investment Institute Bloomberg , 2019. For illustrative purposes only. High -yield municipal = Sources: Bloomberg Barclays, FactSet, and , as of March 31 Barclays High Yield Municipal Bond Index. High Bloomberg Barclays U.S. Corporate High Yield Bond Index. Yields represent past performance and -yield corporate = fluctuate with market conditions. Current yields may be higher or lower than those quoted above. Past performance is no guarantee of future results. Yield to worst is the lowest potential yield that can be received on a bond without the issuer actually defaulting. An index is unmanaged and not available for direct investment. KEY TAKEAWAYS • High- yield municipal bonds have performed relatively well despite headwinds from Puerto Rico and cha llenges experienced by their corporate counterparts. • We recommend that in vestors reduce exposure to high -yield municipal debt and favor investment -grade portfolio. municipal and/or taxable bonds as part of a well -diversified 47

48 bond yield converge Inflation rate and T- 10-YEAR U.S. TREASURY VS. INFLATION ECONOMY 18 16 EQUITIES 14 FIXED 12 INCOME 10 REAL ASSETS 8 6 ALTERNATIVE INVESTMENTS 4 Yield/Inflation rate (%) 2 CURRENCIES 0 ASSET -2 ALLOCATION -4 '79 '67 '70 '73 '76 '82 '64 '85 '88 '91 '94 '97 '00 '03 '06 '09 '12 '15 '18 DISCLOSURES CPI 10-year U.S. Treasury note Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31 , 2019. For illustrative purposes only. Yields represent past performance and fluctuate with market conditions. Current yields may be higher or lower than those quoted above. Past performance is no guarantee of future results. CPI is the Consumer Price Index. It measures the price of a fixed basket of goods and services purchased by an average consumer. KEY TAKEAWAYS • Real yields on 10 -year U.S. Treasury bonds continue to decline as inflation ticks up. -Protected Securities (TIPS) sector. • An unexpected rise in inflation could benefit the Treasury Inflation 48

49 Credit market spreads TERM AVERAGE CREDIT SPREADS HAVE WIDENED CLOSER TO LONG- ECONOMY LEVELS 20 18 EQUITIES 16 FIXED INCOME 14 12 REAL ASSETS 10 ALTERNATIVE INVESTMENTS 8 -adjusted spreads (%) 6 CURRENCIES Option 4 ASSET 2 ALLOCATION 0 DISCLOSURES '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '06 '07 Investment grade High yield Emerging markets March 31 , 2019. For illustrative purposes only. Sources: Bloomberg and Wells Fargo Investment Institute, as of -adjusted spread is the Option difference in yield over equivalent -duration Treasuries. Investment grade represented by Bloomberg Barclays U.S. Aggregate Bond Index, high yield represented by Bloomberg Barclays U.S. Corporate High Yield Bond Index, emerging markets represented by J.P. Morgan Emerging Markets Bond Index Global ( Past performance is no guarantee of future results . An index is unmanaged and not available for USD). direct investment . KEY TAKEAWAYS • Credit spreads on taxable bond sectors have tightened over the past couple of years as investors bet on fiscal stimul us and better economic growth. Credit spreads tend to increase during periods of uncertainty and decrease during periods of stability. • 49

50 Real assets highlights General ECONOMY Individual commodity prices tend to move together, over very long bull and bear • cycle - cycles” frequently run s, often lasting a decade or more. These “super EQUITIES counter to equity cycles, which can provide diversification benefits. - China was the main driver of the last two commodity super • cycles (bull – 1999- FIXED INCOME 2010, bear – 2011 to present). Slowing Chinese GDP growth, since 2011, triggered our current bear super cycle. - REAL ASSETS • For 2019, we expect commodities to perform relatively well. Key drivers to watch ALTERNATIVE a , a weakening U.S. dollar, and bottoming valuations. growth re Chinese INVESTMENTS Oil CURRENCIES • Oil prices rose in the first quarter of 2019 as investors priced in Organization of he Petroleum Exporting Countries (OPEC) production cuts. t ASSET ALLOCATION ance • For 2019, we’re expecting higher prices due to a better supply/demand bal DISCLOSURES and heightened geopolitical tensions between oil producing countries. Gold cycles suggests that gold prices should remain range - bound • The history of super - over the coming years. REITs state investment trusts (REITs) outperformed late in 2018, despite Real e • weakening fundamentals. This late in an economic expansion, we remain cautious. 50 50

51 Real assets scorecard YoY return Yield YTD return 1Q19 Asset class (%) (%) (%) return (%) ECONOMY Commodities 6.32 6.32 -5.25 – EQUITIES Energy commodities 15.93 – 15.93 -0.55 FIXED INCOME Agricultural -16.26 -3.18 -3.18 – commodities REAL ASSETS Precious metals 0.02 -4.04 0.02 – commodities ALTERNATIVE INVESTMENTS Base metals 12.85 -3.10 – 12.85 commodities CURRENCIES Global REITs 14.86 14.86 14.33 3.87 ASSET ALLOCATION U.S. REITs 3.84 17.17 17.17 20.46 DISCLOSURES International REITs 13.72 7.69 3.61 13.72 Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31, 2019. YoY = year over year. YTD = year to date. For illustrative purposes only. Indices in order represented by Bloomberg Commodity Index, Bloomberg Energy Subindex, Bloomberg Agriculture Subindex, Bloomberg Precious Metals Subindex, Bloomberg Industrial Metals Subindex, FTSE All Equity REITs Index, FTSE EPRA/NAREIT Developed Index, FTSE EPRA NAREIT Developed ex-U.S. REITs Index. Yields represent past performance and fluctuate with market conditions. Current yields may be higher or lower than those quoted above. Past performance is no guarantee of future results . An index is unmanaged and not available for direct investment. KEY TAKEAWAYS • Energy commodities outperformed other sectors as oil prices rebounded in the first quarter of 2019. • Overall, we expect commodities to perform well in 2019 as the U.S. dollar weakens, valuations remain attr active, and Chinese GDP growth could outperform lowered expectations. REITs performed admirably in 2018, despite softening fundamentals. We remain cautious this late in an • 51 51 econom ic expansion.

52 Commodities tend to run opposite of equities ECONOMY 800 EQUITIES level 200 FIXED Shaded areas represent secular commodity bear markets INCOME Commodity composite 50 '54 '62 '14 '22 '30 '38 '46 '18 '10 '70 '78 '86 '94 '02 Commodity composite REAL ASSETS 12,800 ALTERNATIVE INVESTMENTS 3,200 CURRENCIES 800 200 Index level bear markets Shaded areas represent secular equity ASSET ALLOCATION 50 '70 '38 '46 '54 '62 '94 '78 '86 '14 '02 '10 '18 '22 '30 Dow Jones Industrial Average DISCLOSURES Bloomberg, Bureau of Labor National Bureau of Economic Research, Prices by Warren and Pearson, and Wells Fargo Investment Sources: Statistics, Institute, as of March 31, 2019. For illustrative purposes only. Commodity composite measures a basket of commodity prices as well as inflation. It blends historical market data introduced by George F. Warren and Frank A. Pearson, former academics at Cornell; collected and published commodity price data in their book, Prices ; the Producer Price Index for commodities (PPI -Commodities); the National Bureau of Economic Research (NBER) Index of Spot Market Prices of 22 and the Reuters Continuous Commodity Index . An index is unmanaged and not Commodities; available for direct investing. Past performance is no guarantee of future results. A secular bull market is a period in which prices rise at an above -average rate for an extended period and suffer only relatively short intervening declines. A secular bear market is an ext ended period of flat or declining prices. Secular bull or bear markets indicate long -term market trends and typically consist of multiple cyclical bull and bear markets. KEY TAKEAWAYS • Individual commodities tend to move together as a family over long price cycles, called “super -cycles.” These supe r-cycles often run counter to U.S. equities, which can provide diversification benefits. and demand is better balanced with • Commodity prices have started to stabilize; valuations are attractive; supply . We are currently favorable on commodities. 52 52

53 super- cycles Commodity COMMODITY CYCLES HAVE BEEN SHORTENING ECONOMY 450 EQUITIES 330% 350 FIXED 268% 268% average commodity bull market The INCOME returned 218% over 15.9 years 250 200% REAL 177% ASSETS 150 ALTERNATIVE 69% INVESTMENTS Return (%) 50 CURRENCIES -50 ASSET -37% -37% -38% ALLOCATION -62% -64% -70% The 51% over 20 years average commodity bear market lost -150 DISCLOSURES 2018 1874 1803 1820 1892 1946 1964 1982 2000 1856 1838 1928 1910 Commodity bear market performance Commodity bull market performance Bloomberg, Ned Davis Research, and Sources: 31, 2019. For illustrative purposes only. NDR Wells Fargo Investment Institute, as of March Commodity Composite used for 1972. Reuter's Continuous Commodity Index used for March 1972– March 2019. The –February December 1802 -weighted geometric average of commodity price levels relative to the base year av erage Reuters Continuous Commodity Index is an equal Past price. An index is unmanaged and not available for direct investment. performance is no guarantee of future results. KEY TAKEAWAYS • -cycle has gradually shortened in length over time. Our current commodity The average commodity super bear super- cycle, which began in 2011, may very well be shorter than the 20- year average. • As for our current bear super- cycle, m ost commodity prices have likely seen their lows. That said, excessive Price rallies should remain capped, and price supplies, built -up during the bull years, remain a concern. 53 53 levels range -bound, for a few years still.

54 roars The dragon CHINA'S CONSUMPTION OF COMMODITIES HAS SOARED 60 ECONOMY 55 EQUITIES 50 45 FIXED INCOME 40 35 REAL ASSETS 30 25 ALTERNATIVE INVESTMENTS 20 CURRENCIES 15 10 ASSET 5 ALLOCATION Chinese consumption as % of world consumption 0 '00 '82 '84 '86 '88 '90 '92 '94 '96 '98 '02 '80 '04 '06 '08 '10 '12 '14 '16 '18 DISCLOSURES Aluminum Nickel Wheat Zinc Soybeans Copper Corn Bloomberg, U.S. Department of Agriculture, World Bureau of Metal Statistics, and Wells Fargo Investment Institute, as of Sources: December 31, 2018. Consumption data for Aluminum, Nickel, Zinc, and Copper as of December 31, 2017. KEY TAKEAWAYS • -cycle typically has a main influence. China has been the main driver during our last Each commodity super two commodity super -cycles (bull – 1999- 2010, bear – 2011 to present). Example : China has grown from roughly 5% of the world’s industrial metals demand, in 1980, to over 40% today. Since 2011, however, Chinese demand growth has slowed, which likely triggered our current bear super- • 54 54 cycle .

55 U.S. adding massive oil supplies TOP GLOBAL PETROLEUM PRODUCERS 21 ECONOMY 19 EQUITIES 17 FIXED 15 INCOME 13 REAL ASSETS 11 ALTERNATIVE 9 INVESTMENTS Millions of barrels per day 7 CURRENCIES 5 ASSET 3 ALLOCATION 1 DISCLOSURES 1986 1990 1994 1998 2002 2006 2010 2014 2018 1982 China Russia Saudi Arabia U.S. Iran Sources: U.S. Energy Information Administration and Wells Fargo Investment Institute, as of March 31, 2019. KEY TAKEAWAYS • The U.S. is now the world’s largest producer and consumer of petroleum. 55 55

56 Excess supply capped oil prices in 2018 BRENT OIL PRICES VS GLOBAL OIL DEMAND/SUPPLY BALANCE 6.25 $160 ECONOMY 5.50 $140 EQUITIES 4.75 $120 FIXED INCOME 4.00 $100 3.25 REAL ASSETS 2.50 $80 ALTERNATIVE INVESTMENTS 1.75 $60 CURRENCIES 1.00 $40 0.25 Brent crude price (U.S. dollars per barrel) ASSET ALLOCATION $20 Global demand growth minus supply growth(%) -0.50 DISCLOSURES -1.25 $0 '06 '08 '10 '12 '14 '16 '18 '02 '04 Global demand growth minus supply growth YoY (12 month average) Brent crude oil Sources: Bloomberg, Energy Information Administration, and Wells Fargo Investment Institute, as of March 31 , 2019. KEY TAKEAWAYS • Oil prices sank at the end of 2018, as investors realized that global supplies were swamping demand; but deman d has improved year to date, contributing to higher oil prices. We expect higher prices in 2019, due to a better global supply/demand balance, and heightened geopolitical • tens ions between the largest oil producing countries. 56 56

57 Gold is not THAT cheap GOLD VS. BONDS, STOCKS, AND HOME PRICES ECONOMY 9 1.2 10 EQUITIES 8 9 1 Gold expensive Gold expensive Gold expensive FIXED 8 7 INCOME 7 6 0.8 REAL Average = 4.05 6 ASSETS 5 0.6 5 Average = 3.69 4 ALTERNATIVE Average = 0.36 INVESTMENTS 4 10+ Year Index 3 0.4 3 CURRENCIES Gold cheap Gold cheap 2 Gold spot price/S&P 500 Index 2 0.2 Gold cheap 1 1 Gold spot price/mean existing home prices ASSET Gold spot price/Bloomberg Barclays U.S. Treasury ALLOCATION 0 0 0 '17 '99 '02 '05 '08 '11 '14 '14 '08 '05 '02 '99 '11 '17 '99 '17 '02 '08 '05 '14 '11 Gold spot price/Bloomberg Barclays U.S. DISCLOSURES Gold spot price/S&P 500 Index total return Treasury 10+ Year Index total return Gold spot price/mean existing home prices Gold spot prices are New York Metals Exchange gold spot Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31, 2019. prices. A spot price is the current price of a or security at which it can be bought or sold at a particular place and time. Mean commodity existing home prices are represented by the National Association of Realtors U.S. Existing Home Sales Average Price Not Seasonally Adjusted Index. An index is unmanaged and not available for direct investment. Past performance is no guarantee of future results. KEY TAKEAWAYS Gold prices effectively were flat last year. • • For gold prices to enter a new bull super- cycle, valuations versus other major asset classes, need to be washed -ou t. This is not the case today. • Gold appears be fairly valued relative to bonds, and home prices, and somewhat cheap versus stocks , based 57 57 on historical ratios.

58 pattern supercycle Gold tracking past bear ECONOMY GOLD CAN EXPERIENCE SHORT RALLIES WITHIN A BEAR SUPERCYCLE 8/2020 8/2026 8/2023 8/2017 8/2014 8/2011 EQUITIES 115 115 FIXED INCOME 100 100 REAL ASSETS 85 85 ALTERNATIVE INVESTMENTS 70 70 Index level Index level CURRENCIES 55 55 ASSET ALLOCATION 40 40 DISCLOSURES 25 25 1/1986 1/1989 1/1992 1/1995 1/1998 1/1980 1/1983 Gold bullion (1/21/1980–12/30/1999) Gold bullion (8/17/2011–3/29/2019) Sources: Bloomberg, London Bullion Market Association, and Wells Fargo Investment Institute, as of March 31, 2019. KEY TAKEAWAYS • History suggests that gold prices should moderate and remain range -bound for the rest of the bear super - . cycle 58 58

59 REITs fundamentals are soft STANDARDS FOR COMMERCIAL REAL ESTATE LOANS LENDING 90 ECONOMY Tighter standards All CRE* 75 Construction and development 60 Multifamily EQUITIES 45 Collateralized 30 FIXED 15 INCOME 0 Easier standards standards for CRE loans REAL -15 ASSETS -30 Net % of domestic banks tightening 2015 1995 2011 1999 2019 2003 1991 2007 ALTERNATIVE INVESTMENTS 50 Increasing demand CURRENCIES 25 0 ASSET ALLOCATION -25 All CRE* for CRE loans DISCLOSURES Construction and development -50 Multifamily Net % of domestic banks Decreasing demand reporting increasing demand Collateralized -75 1995 1999 2003 2007 2011 2015 2019 1991 Sources: Federal Reserve Board, and Wells Fargo Investment Institute, as of January 31, 2019. For illustrative purposes only. Bloomberg, Shading represents U.S. recessions. Past performance is no guarantee of future results. *All CRE data discontinued 9/30/2013. KEY TAKEAWAYS • REIT fundamentals softened throughout 2018 and remain a major concern in 2019, particularly this deep o an economic expansion. int 59 59

60 REITs are no great bargain EQUITY REITS PREMIUM TO NET ASSET VALUE IS BELOW THE MEDIAN 40 ECONOMY 30 EQUITIES 20 FIXED INCOME 10 0 REAL ASSETS -10 ALTERNATIVE INVESTMENTS -20 CURRENCIES -30 Median: 1.8% Net asset value (NAV) premium (%) Current: -1.5% -40 ASSET ALLOCATION -50 '04 '94 '96 '98 '00 '02 '06 '90 '08 '10 '12 '14 '16 '18 '92 DISCLOSURES Median All REITs premium to NAV Sources: Green Street Advisors and Wells Fargo Investment Institute, as of February 28, 2019. U.S.- listed companies in Green All REITs premium to NAV (net asset value) is a weighted average (weighted by NAV shares outstanding) of all . eet's coverage universe, excluding hotels and those without a published opinion Str KEY TAKEAWAYS • REITs currently trade at a slight discount to their underlying real estate holdings (NAV). While not althy, valuations are not attractive enough for us to favor this asset class this late into an economic unhe expansion. 60 60

61 Alternative investments highlights ECONOMY Hedge funds raditional portfolio of stocks and bonds historically has seen increased • A t EQUITIES returns and decreased risk by adding hedge funds. FIXED INCOME Hedge funds can potentially mitigate portfolio losses and participate in equity • ma rket upturns. REAL ASSETS • Hedge funds, and active management in general, historically perform better in he latter stages of an economic and credit cycle. t ALTERNATIVE INVESTMENTS • There’s an opportunity in credit as modestly higher interest rates and somewhat CURRENCIES wer U.S. economic and corporate earnings growth should magnify the slo differences between fundamentally strong and weak companies. ASSET ALLOCATION • Historically, hedge funds have delivered higher returns than stocks and bonds o ver time, primarily due to their ability to limit drawdowns. DISCLOSURES Private capital • The majority of companies remain private, which inherently offers private pital strategies a robust opportunity set. ca • Private equity funds have been able to deliver strong returns and have utperformed global equities in various time frames. o Private real assets have historically outperformed public real estate (REITs) over • full market cycle. a 61 61

62 Alternative investments scorecard YoY YTD 4Q18 Jan. 2019–Feb. Index return (%) Return (%) Return (%) urn (%) 2019 ret ECONOMY HFRI Fund Weighted Composite -0.56 4.88 -6.00 4.88 as of 12/31/2018 HFRI Event Driven EQUITIES 1.91 -4.84 4.80 4.80 as of 12/31/2018 HFRI Macro FIXED -2.25 0.98 -2.07 0.98 as of 12/31/2018 INCOME HFRI Relative Value 2.45 -3.42 3.52 3.52 as of 12/31/2018 REAL ASSETS HFRI Equity Hedge -8.49 -1.57 6.98 6.98 as of 12/31/2018 ALTERNATIVE INVESTMENTS Cambridge Associates U.S. Private Equity – 18.42 12.39 – as of 9/30/2018 CURRENCIES ILPA Private Credit – 9.99 7.07 as of 9/30/2018 ASSET ALLOCATION NCREIF Property – 1.37 6.71 6.71 as of 12/31/2018 Sources: Bloomberg, Morningstar Direct, Institutional Limited Partners Association (ILPA), and Wells Fargo Investment Institute, as of DISCLOSURES February 28, 2019. YoY = year over year. YTD = year to date. For illustrative purposes only. Index returns do not represent investment performance or the results of actual trading. Index returns reflect general market results; assume the reinvestment of dividends and other distributions; and do not reflect deductions for fees, expenses, or taxes applicable to an actual investment. Unlike most asset-class indices, HFR index returns are net of all fees. Because the HFR indices are calculated based on information that is voluntarily provided, actual returns may be higher or lower than those reported. An index is unmanaged and not available for direct investment. Past performance is no guarantee of future results. The Cambridge Index uses a horizon calculation based on data compiled from more than 1,400 institutional- quality buyout, growth equity, private equity energy, and subordinated capital funds formed between 1986 and 2017. The funds included in the index report their performance voluntarily, and therefore, the index may reflect a bias towards funds with records of success. More information on the limitations of utilizing this Index can be found at the end of this presentation. KEY TAKEAWAYS Hedge funds have benefited from a reduction in equity correlations as well as greater dispersion among • sectors, industries, and geographies. Much of this is attributable to changes in monetary policy as well as rising interest rates. 62 62

63 Alternative investments scorecard investments, such as hedge funds and private equity/private debt funds, are not suitable for all investors and are only open to Alternative ECONOMY investors within the meaning of the U.S. securities laws. They are speculative and involve a high degree of risk that is or qualified accredited inv estment in a fund suitable only for those investors who have the financial sophistication and expertise to evaluate the merits and risks of an investors may potentially benefit from the ability of alternative and for which the fund does not represent a complete investment program. While profiles of their portfolios, the investments themselves can carry significant risks. There may risk/reward investments to potentially improve the EQUITIES and transferability may be limited or even prohibited. Hedge fund strategies, such interests, be no secondary market for alternative investment as Equity Hedge, Event Driven, may expose investors to risks such as short selling, leverage, counterparty, liquidity, Macro, Value, and Relative and other significant risks. instruments, volatility, the use of derivative FIXED INCOME have special risks, including the possible illiquidity of the underlying properties, credit risk, interest rate fluctuations, REITS an d the impact of ied economic conditions. var REAL ASSETS ALTERNATIVE INVESTMENTS CURRENCIES ASSET ALLOCATION DISCLOSURES KEY TAKEAWAYS 63 63

64 hedge funds Diversification benefits of HEDGE FUNDS CAN POTENTIALLY REDUCE RISK IN A PORTFOLIO OF STOCKS AND BONDS ECONOMY 60% U.S. 9.5 equities 20% bonds 10 20% hedge 40% U.S. EQUITIES funds Hedge funds equities 9.0 U.S. equities 40% bonds 9 70% U.S. 20% hedge equities 30% funds FIXED 8.5 20% U.S. INCOME bonds 8 equities 60% bonds 50% U.S. 20% hedge 8.0 REAL equities 50% funds 7 ASSETS bonds Global equities 7.5 30% U.S. 6 ALTERNATIVE equities 70% Total annualized return (%) INVESTMENTS bonds Total annualized return (%) Bonds 7.0 5 CURRENCIES 6.5 4 10.0 8.0 6.0 4.0 12.0 8.0 13.0 18.0 3.0 ASSET ALLOCATION Total annualized standard deviation (%) Total annualized standard deviation (%) 1990– February 28, 2019. Bonds = Bloomberg Barclays U.S. Aggregate Bond Sources: Morningstar Direct and Wells Fargo Investment Institute, January 1, For illustrative purposes Index. U.S. equities = S&P 500 Index. Global equities = MSCI World Index. Hedge funds = HFRI Fund Weighted Composite Index. DISCLOSURES only. Index returns do not represent investment performance or the results of actual trading . Index returns reflect general market results, assume the most asset investment. Unlike or taxes applicable to an actual not reflect deduction for fees, expenses, reinvestment of dividends and other distributions and do are net of all fees. Because the HFR indices are calculated based on information that is voluntarily provided actual returns may class indices, HFR Index returns Hypothetical and past performance is no guarantee of . An index is unmanaged and not available for direct investment be lower than those reported future results Standard deviation is a measure of the volatility of returns. The higher the standard deviation, the greater volatility has been. . Alternative investments, such as hedge funds, are not suitable for all investors and are only open to accredited or qualified investors within the meaning of the the financial sophistication and . securities laws. They are speculative and involve a high degree of risk that is suitable only for those investors who have U.S expertise to evaluate the merits and risks of an investment in a fund and for which the fund does not represent a complete inves tment program. KEY TAKEAWAYS • Adding hedge funds to a traditional portfolio of stocks and bonds historically has increased returns and decre ased risk. Diversification strategies do not guarantee investment returns or eliminate the risk of loss. 64 64

65 by not losing Hedge funds may win HEDGE FUNDS CAN HELP MINIMIZE LOSSES AND HOLD POTENTIAL ECONOMY FOR THE UPSIDE 4 EQUITIES 3 3.18% 19% 2 1.65% FIXED INCOME down capture (%) 1 REAL ASSETS 0 return -1 ALTERNATIVE -0.69% INVESTMENTS 52% Average up capture -2 CURRENCIES -3 -3.56% -4 ASSET ALLOCATION Up markets Down markets Hedge funds Global equities DISCLOSURES funds represented by the HFRI Fund Weighted Hedge 1990– February 28, 2019. Sources: Morningstar Direct and Wells Fargo Investment Institute, January 1, Index does not represent investment performance or the results Composite Index. Global equities represented by the MSCI World Index. For illustrative purposes only. of actual trading. Index returns reflect general market results, assume the reinvestment of dividends and other distributions , a nd do not reflect deduction for fees, expenses or taxes applicable to an actual investment. HFR Index returns are net of all fees. Because the HFR indices are calcula ted based on information that is . Past performance is no stm ent voluntarily provided actual returns may be lower than those reported. An index is unmanaged and not available for direct inve . guarantee of future results Alternative investments, such as hedge funds, are not suitable for all investors and are only open to accredited or qualified investors within the meaning of the U.S. ties laws. They are speculative and involve a high degree of risk that is suitable only for those investors who have th e f inancial sophistication and expertise to securi ram . evaluate the merits and risks of an investment in a fund and for which the fund does not represent a complete investment prog KEY TAKEAWAYS • Hedge funds can potentially minimize losses during periods of negative global equity market performance whil e maintaining participation in the upside. capture ratio measures a manager's performance in up markets relative to the market (benchmark) itself. It is calculated by taking the Upside security’s upside capture return and dividing it by the benchmark’s upside capture return. ratio measures was Downside down market performance in down markets. In essence, it tells you what percentage of the a manager's capture 65 65 ured by the manager. capt

66 late cycle Active strategies tend to outperform 120 110 ECONOMY 100 90 EQUITIES 80 3/1/2000) 70 FIXED 60 INCOME Index value (indexed to 100 on 50 Mar-01 Dec-00 Sep-00 Jun-00 Dec-02 Jun-02 Mar-02 Dec-01 Sep-01 Sep-02 Mar-00 Jun-01 REAL MSCI World Index U.S. recession S&P 500 Index HFRI Fund Weighted Composite Index ASSETS 120 ALTERNATIVE INVESTMENTS 110 100 CURRENCIES 90 80 12/1/2006) 70 ASSET ALLOCATION 60 50 Index value (indexed to 100 on DISCLOSURES Dec-06 Jun-09 Jun-07 Dec-08 Jun-08 Dec-07 Dec-09 Jun-10 MSCI World Index U.S. recession S&P 500 Index HFRI Fund Weighted Composite Index , 2019 . Index returns do not represent investment performance or the results of actual trading. Fargo Investment Sources: Bloomberg and Wells Institute, as of March 31 do not reflect deduction for fees, expenses or taxes Index returns reflect general market results, assume the reinvestment of dividends and other distributions, and are net of all applicable to an actual investment. Unlike most asset class indices, HFR Index fees. Because the HFR indices are calculated based on information that is Past performance is no guarantee of future results. reported. voluntarily provided actual returns may be lower than those or qualified Alternative investments, such as hedge funds, are not suitable for all investors and are only open to accredited investors within the meaning of the U.S. ties laws. They are speculative and involve a high degree of risk that is suitable only for those investors who have th e f inancial sophistication and expertise to securi ram . evaluate the merits and risks of an investment in a fund and for which the fund does not represent a complete investment prog KEY TAKEAWAYS • Historically, transitioning into the latter stages of the cycle has coincided with an improvement in both the abso lute and relative performance of hedge funds. In the latter part of the cycle, certain active managers may outperform passive ones. • 66 66

67 Hedge funds can benefit as rates rise HEDGE FUNDS HISTORICALLY HAVE PERFORMED WELL DURING PERIODS OF RISING INTEREST RATES ECONOMY 9 8 7 EQUITIES 6 5 4 FIXED funds rate (%) 3 INCOME 2 1 REAL Federal 0 ASSETS '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 ALTERNATIVE Change in 10-year Treasury INVESTMENTS Bonds Start Hedge funds End # of days yield (basis points) -3.3% Sep-93 Nov-94 455 2.46 13.6% CURRENCIES Dec-95 Jun-96 210 1.01 15.6% 0.0% 1.6% 43.6% 517 Jan-00 1.60 Sep-98 Jun-03 1094 May-06 41.3% 6.1% 1.71 515 0.92 24.5% 12.4% Dec-08 Apr-10 ASSET ALLOCATION Feb-11 Oct-10 0.92 7.1% -0.9% 150 Jul-12 Dec-13 547 1.44 14.1% -0.6% Jul-16 Mar-17 273 0.94 6.8% -1.9% DISCLOSURES Current period Sep-17 0.55 3.2% 1.1% Feb-19 1.28 18.9% 1.6% Average Sources: Bloomberg, Federal Reserve, and Wells Fargo Investment Institute. Top chart as of March 31, 2019. Bottom table as of February 28, 2019. Hedge funds represented by the HFRI Fund Weighted Composite Index. Bonds represented by the Bloomberg Barclays U.S. Aggregate Bond Index. For illustrative purposes only. Index returns do not represent investment performance or the results of actual trading. Index returns reflect general market results, assume the reinvestment of dividends and other distributions, and do not reflect deduction for fees, expenses or taxes applicable to an actual investment. Unlike most asset class indices, HFR Index returns are net of all fees. Because the HFR indices are calculated based on information that is voluntarily provided actual returns may be lower than those reported. An index is unmanaged and not available for direct investment. Past performance is no guarantee of future results. There is no guarantee any asset class will perform in a similar manner in the future or in other rising rate environments. KEY TAKEAWAYS • Hedge funds historically have performed well during periods of rising interest rates. Alternative investments, such as hedge funds, are not suitable for all investors and are only open to accredited or qualified investors within the meaning of the U.S. securities laws. They are speculative and involve a high degree of risk that is suitable only for those investors who have the financial sophistication and expertise to evaluate the merits and risks of an investment in a fund and for which the fund does not represent a complete investment program. 67 67

68 Potential for corporate bond downgrades creates an opportunity in credit ECONOMY HALF OF THE CORPORATE BONDS IN THE BLOOMBERG BARCLAYS AGGREGATE BOND INDEX ARE Baa/BBB RATED 55 $3.00 EQUITIES 50 $2.50 FIXED 45 INCOME 40 $2.00 REAL ASSETS 35 $1.50 ALTERNATIVE INVESTMENTS 30 25 $1.00 CURRENCIES 20 $0.50 Outstanding par amount (billion U.S. dollars) ASSET ALLOCATION 15 Baa percent of total U.S. investment grade debt (%) 10 $0.00 DISCLOSURES Dec-11 Dec-02 Dec-05 Dec-90 Dec-93 Dec-14 Dec-17 Dec-96 Dec-99 Dec-08 U.S. Baa/BBB corporate debt outstanding (LHS) Baa % of total U.S. investment grade debt (RHS) Sources: Bloomberg Barclays and Wells Fargo Investment Institute, as of December 31, 2018. For illustrative purposes only. Bloomberg Barclays U.S. Aggregate Bond Index is a broad-based flagship benchmark that measures the investment grade, U.S. dollar-denominated, fixed-rate taxable bond market. An index is unmanaged and not available for direct investment. Please see the end of this presentation for notes associated with this chart and a description of the asset class risks. Credit ratings are not intended to indicate the value, suitability, or merit of an investment. They are opinions of credit quality and, in some cases, the expected recovery in the event of default. Please see the end of this report for important information on credit ratings. KEY TAKEAWAYS • Modestly higher interest rates and somewhat slower U.S. economic and corporate earnings growth should magnify the differences between fundamentally strong and weak companies. • The notably large proportion of these bonds (at the bottom rung of the investment-grade quality ladder) implie s a potential for large-scale downgrades if fundamentals deteriorate. 68 68

69 Opportunities in private equity NUMBER OF PUBLIC COMPANIES HAS ECONOMY FALLEN 9,000 EQUITIES 0.1% 0.1% 8,000 FIXED 7,000 INCOME 6,000 REAL ASSETS 5,000 ALTERNATIVE 4,000 INVESTMENTS 99.9% 3,000 CURRENCIES Number of firms listed on NYSE and NASDAQ 2,000 ASSET ALLOCATION 1,000 Public companies (~4,400) 0 DISCLOSURES Private companies (~6,000,000) '80 '82 '84 '86 '88 '90 '92 '94 '96 '98 '00 '02 '04 '06 '08 '10 '12 '14 '16 '18 Wells Fargo Investment Institute, as of December 31, 2018. NYSE = New U.S. Census Bureau, World Federation of Exchanges, and Sources: (~ = approximately). York Stock Exchange. NASDAQ = National Association of Securities Dealers Automated Quotations. KEY TAKEAWAYS The majority of companies remain private, which inherently offers private capital strategies a robust • ortunity set. opp The delist rate since 2000 is due to an unusually high rate of acquisitions of publicly listed firms. • 69 69

70 Opportunities in private equity PRIVATE EQUITY HAS OUTPERFORMED GLOBAL EQUITIES 18 ECONOMY 16 14 EQUITIES 12 (%) FIXED INCOME 10 return 8 REAL ASSETS 6 Annualized ALTERNATIVE 4 INVESTMENTS 2 CURRENCIES 0 15 years 20 years 25 years 3 years 5 years 10 years Global equities Fixed income Small-cap equities Private equity ASSET ALLOCATION Sources: Morningstar Direct and Wells Fargo Investment Institute, as of September 30, 2018. Private equity = Cambridge Associates Private Equity . (Cambridge Index) Global equities = MSCI World Index. Small -cap equities = Russell 2000 Index. Fixed income = Bloomberg Barclays U.S. Aggregate Bond Index. For illustrative purposes only . DISCLOSURES The Cambridge Index uses a horizon calculation based on data compiled from more than 1,400 institutional -quality buyout, growth equi ty, eir ate equity energy, and subordinated capital funds formed between 1986 and 2017. The funds included in the index report th priv performance voluntarily and therefore the index may reflect a bias towards funds with records of success. More information on the limitations of utilizing this Index can be found at the end of this presentation. Alternative investments, such as private capital funds, are not suitable for all investors and are only open to accredited or qualified investors hin the meaning of the U.S. securities laws. They are speculative and involve a high degree of risk that is suitable only for those investors wit who have the financial sophistication and expertise to evaluate the merits and risks of an investment in a fund and for which the fund does not represent a complete investment program. KEY TAKEAWAYS • Private equity funds strive to deliver significant capital appreciation for investors. Private equity funds have been able to deliver strong returns and have outperformed global equities in • vari ous time frames. 70 70

71 Private debt can provide an illiquidity premium ECONOMY CAPTURING THE ILLIQUIDITY PREMIUM WITH PRIVATE CREDIT 14 EQUITIES 12 FIXED 10 INCOME 8 REAL ASSETS 6 4 Return (%) ALTERNATIVE INVESTMENTS 2 CURRENCIES 0 -2 ASSET -4 ALLOCATION YTD 3-year 10-year 15-year 20-year 25-year 5-year 1-quarter 1-year ILPA Private Markets Benchmark –Private Credit Bloomberg Barclays Government/Credit Bond Index DISCLOSURES Wells Fargo Investment Institute, as of September 30, Sources: Bloomberg, Institutional Limited Partners Association (ILPA), and 2018. For illustrative purposes only. The ILPA Private Markets Benchmark (ILPA ) is a horizon calculation based on data complied – Private Credit Fund Index formed between 1986 from 269 private credit funds (credit opportunities and subordinated capital funds), including fully liquidated partnerships, Bloomberg Barclays U.S. Government/Credit Index is a broad -based index that measures the non- securitized component of the and 2017. . It includes investment grade, U.S. dollar -denominated, fixed -rate Treasuries, government -related and corporate Barclays U.S. Aggregate Index securities. Broad -based indices do not represent investment performance or the results of actual trading. Index returns reflect general market results, assume the reinvestment of dividends and other distributions, and do not reflect deduction for fees, or taxes applicable to an expenses, actual investment. An index is unmanaged and not available for direct investment . Past performance is no guarantee of future results . More information on the limitations of utilizing ILPA can be found at the end of this presentation. KEY TAKEAWAYS • Though less liquid than public credit, private credit historically has provided an attractive premium given the complexity of lending to entities that are unable to borrow from traditional capital market sources. Alternative investments, such as private capital funds, are not suitable for all investors and are only open to accredited or qualified investors within se investors who have the the meaning of the U.S. securities laws. They are speculative and involve a high degree of risk that is suitable only for tho financial sophistication and expertise to evaluate the merits and risks of an investment in a fund and for which the fund does not represent a complete investment program. 71 71

72 Opportunities in private real assets PRIVATE REAL ASSETS HAVE PERFORMED WELL ECONOMY 15 EQUITIES 10 FIXED 5 INCOME REAL 0 ASSETS Return (%) -5 ALTERNATIVE INVESTMENTS -10 CURRENCIES -15 ASSET NCREIF Farmland NCREIF Timberland NAREIT All Equity REITs NCREIF Property Index S&P 500 Index ALLOCATION Index Q4 2018 1-year 10-year DISCLOSURES Sources: National Council of Real Estate Investment Fiduciaries (NCREIF ) and Wells Fargo Investment Institute, as of December 31, 2018. NCREIF is a composite total return for private commercial real estate properties held for For illustrative purposes only. Property Index investment purposes only. NCREIF Farmland Index is a return measure of investment performance of a large pool of individual composite farmland properties acquired in the private market for investment purposes only. NCREIF Timberland Index is a composite return measure of investment performance of a large pool of individual timber properties acquired in the private market for investment purposes only. NAREIT All Equity is considered representative of the equity REIT market. Index returns do not represent investment performance or the REIT Index results of actual trading. Index returns reflect general market results, assume the reinvestment of dividends and other distr ibu tions, and do not reflect deduction for fees, expenses or taxes applicable to an actual investment. An index is unmanaged and not available for direct investment. Past performance is no guarantee of future results. KEY TAKEAWAYS outperformed public real estate (REITs) over a full market cycle. Private real assets have historically • 72 72

73 Currencies highlights ECONOMY U.S. dollar the first quarter of 2019. in ntinued to strengthen co The U.S. dollar • EQUITIES ver fiscal and trade deficits persist, which may pressure the • o However, concerns FIXED INCOME dollar lower and increase volatility. REAL Developed currencies ASSETS Despite recent euro depreciation, we expect the euro to strengthen over the next • ALTERNATIVE INVESTMENTS 2 months. 1 CURRENCIES • The yen appreciated as the risk - averse global market reacted to ongoing trade disputes and geopolitical risks. ASSET ALLOCATION Emerging currencies DISCLOSURES • Economic and political uncertainties in Argentina, Brazil, and Turkey have ntributed to a sell - off in emerging market currencies. In our opinion, these co developments are the exception rather than the rule, and we think movements in emerging markets currencies will be less volatile in 2019. • Despite the risks from trade conflicts and political transitions in certain co untries, we believe that an environment of continued global economic growth will support emerging market currencies. 73 73

74 Currencies scorecard QoQ YoY ECONOMY Year-end Metric 1Q19 Change Change 2018 (%) (%) EQUITIES DXY Index 97.284 1.16 5.60 96.17 FIXED INCOME Euro (dollars per euro) $1.12 -2.17 $1.15 -6.56 REAL ASSETS Japanese yen (yen per 1.62 ¥109.69 -1.07 ¥110.86 ALTERNATIVE dollar) INVESTMENTS British pound sterling CURRENCIES -3.54 2.20 $1.28 $1.30 (dollar per pound) ASSET Chinese renminbi ALLOCATION ¥6.88 ¥6.71 2.42 -3.16 (yuan per dollar) DISCLOSURES Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31, 2019. QoQ = quarter over quarter. YoY = year over year. The DXY Index measures the value of the U.S. dollar relative to major developed market currencies, notably the euro, the Japanese yen, and the British pound. KEY TAKEAWAYS • Our 12-month currency outlook implies a weaker dollar. We maintain a moderately positive view of emerging market currencies against the dollar. The inclusion of currency policies in any trade settlement may add to volatility. The euro remains undervalued and should see gains as the economy stabilizes and political risks subside. • 74 74 The dollar may be undercut by politics, deficit fears, and lower rate expectations than in 2018.

75 The dollar continues to lose traction MAIN DRIVERS OF THE DOLLAR INDEX IN RECENT YEARS ECONOMY 105 U.S. presidential election 2018 dollar rise on firm growth versus EQUITIES Europe and Japan, 100 steady Fed rate increases FIXED INCOME 95 Monetary policy REAL divergence – Fed ASSETS signals rate rises level while ECB moves to “Dovish pivot” 90 Market negative on begin QE from Fed caps DXY ALTERNATIVE pace of future Fed INVESTMENTS strength – Dec “Fed pause” rate increases 2015 to Dec 2016 DXY Index 85 CURRENCIES fears Twin deficit outweigh rate differentials ASSET ALLOCATION 80 DISCLOSURES 75 Jan-14 May-14 Sep-14 Jan-15 May-15 Sep-15 Jan-16 May-16 Sep-16 Jan-17 May-17 Sep-17 Jan-18 May-18 Sep-18 Jan-19 Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31 , 2019. The DXY Index measures the value of the U.S. dollar relative to major developed market currencies, notably the euro, the Japanese yen, and the British pound. KEY TAKEAWAYS strengthened The U.S. dollar • in 2018, but we expect it to depreciate over the next 12 months. • More sustained dollar weakness could emerge if currency policies are included explicitly or implicitly in the reso lution of trade disputes . But if political risks intensify in Europe and elsewhere, dollar strength may be maintained for longer than we anticipate . 75 75

76 Currency volatility DIFFERENT TRADING REGIMES FOR EURO, YEN, AND POUND VERSUS DOLLAR ECONOMY 1.00 140 135 EQUITIES 1.10 130 FIXED 1.20 125 INCOME 120 1.30 REAL 115 ASSETS 1.40 110 ALTERNATIVE 105 INVESTMENTS Yen per dollar 1.50 100 Dollar/ euro and pound CURRENCIES Dollar stronger 1.60 95 Dollar weaker 90 1.70 ASSET ALLOCATION 85 1.8080 DISCLOSURES Jan-14 May-14 Sep-14 Jan-15 May-15 Sep-15 Jan-16 May-16 Sep-16 Jan-17 May-17 Sep-17 Jan-18 May-18 Sep-18 Jan-19 Dollars per pound (RHS, reverse scale) Yen per dollar (LHS) Dollars per euro (RHS, reverse scale) Sources: as of March 31 , 2019. Bloomberg and Wells Fargo Investment Institute, KEY TAKEAWAYS • The euro weakened in 2018 due to growth disappointments and geopolitical risks, but we expect it to stabilize esume appreciating versus the dollar. and r Brexit fears kept the British pound relative weak in 2018, but it has potential to bounce if a resolution is found. • After the big swings of 2016, the yen shows no clear direction in a relatively narrow trading range. • 76 76

77 The euro and equities returns CURRENCY MOVEMENTS AFFECT EQUITY PERFORMANCE $1.80 Euro has ECONOMY Euro gained 64% vs. weakened vs. $1.60 the U.S. dollar the dollar Euro declined 28.6% recently vs. the U.S. dollar $1.40 EQUITIES $1.20 FIXED INCOME $1.00 Euro is down 21% vs. the U.S. dollar REAL ASSETS $0.80 $0.60 ALTERNATIVE INVESTMENTS '98 '97 '96 '95 '16 '15 '14 '13 '17 '12 '18 '19 '11 '10 '09 '08 '07 '06 '05 '04 '03 '02 '01 '00 '99 Dollars per euro CURRENCIES ANNUAL EQUITY RETURNS FOR THE S&P 500 INDEX AND THE MSCI EAFE INDEX '11 '97 '98 '95 '99 '96 '00 '17 '16 '15 '14 '13 '12 '01 '10 '09 '08 '07 '06 '05 '04 '03 '02 '18 YTD ASSET ALLOCATION S&P 11% - 1% 12% 22% -4% 14% 5% 29% -22% -37% 5% 12% 15% -9% 21% 29% 33% 23% 38% 2% 16% 32% 16% 14% 26% 500 DISCLOSURES MSCI - 21% -4% 0% 2% 26% -13% 10% 2% 20% 27% -14% -21% -16% 39% 12% 14% 27% 12% -43% 32% 8% 6% 12% 18% 23% EAFE Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31, 2019. For illustrative purposes only. The S&P 500 Index is a market- capitalization-weighted index generally considered representative of the U.S. stock market. The MSCI EAFE Index is a free-float-adjusted market- capitalization-weighted index that is designed to measure the equity market performance of 21 developed markets, excluding the U.S. and Canada. Index returns do not represent investment performance or the results of actual trading. Index returns reflect general market results, assume the reinvestment of dividends and other distributions, and do not reflect deduction for fees, expenses or taxes applicable to an actual investment. An index is unmanaged and not available for direct investment. Past performance is no guarantee of future results. KEY TAKEAWAYS • International equities, priced in U.S. dollars, tend to outperform U.S. equities when the euro is appreciating versus the dollar. 77 77

78 Impact of the U.S. dollar DOLLAR STRENGTH OR WEAKNESS IMPACT ON PROFITS, MANUFACTURING, AND EQUITY AND FIXED-INCOME RETURNS ECONOMY DOLLAR DOLLAR 1 1 DEPRECIATION APPRECIATION EQUITIES Average quarterly change in corporate profits 2.28% 1.12% FIXED Average quarterly change in U.S. manufacturing INCOME 0.496 -0.425 act ivity Average quarterly change in global manufacturing REAL -0.125 0.139 ASSETS act ivity Average quarterly commodity total return 2.06% -0.25% ALTERNATIVE INVESTMENTS Average quarterly global equity gross return (USD) 4.30% 0.41% CURRENCIES Average quarterly global equity gross return (LCL) 1.51% 1.29% Average quarterly global fixed income total return 3.02% -0.64% ASSET (unhedge d) ALLOCATION Average quarterly global fixed income total return 1.31% 1.08% (hedge d) DISCLOSURES Sources: Bloomberg, Morningstar Direct, and Wells Fargo Investment Institute, as of March 31, 2019. For illustrative purposes only. Dollar represented by DXY Index (January 1, 1967–March 31, 2019). Corporate profits are seasonally adjusted (January 1, 1967–December 31, 2018). U.S. manufacturing represented by Institute for Supply Management Manufacturing PMI (January 1, 1967–March 31, 2019). Global manufacturing represented by J.P. Morgan Global Manufacturing Index (January 1,1998–March 31, 2019). Commodities represented by Bloomberg Commodity Index (January 1, 1990–March 31, 2019). Global equities represented by MSCI All Country World Index USD/Local Currency (March 1, 1988–March 31, 2019). Global fixed income represented by Bloomberg Barclays Multiverse Index Hedged/Unhedged (March 1, 1999–March 31, 2019). Index returns do not represent investment performance or the results of actual trading. Index returns reflect general market results, assume the reinvestment of dividends and other distributions, and do not reflect deduction for fees, expenses or taxes applicable to an actual investment. An index is unmanaged and not available for direct investment. Past performance is no guarantee of future results . KEY TAKEAWAYS • An appreciating U.S. dollar tends to contribute to corporate profits and U.S. manufacturing activity. • A falling dollar typically enhances global equity, commodity, and unhedged fixed-income performance. 1 Dollar depreciation periods are quarters with a declining value in the DXY Index. Dollar appreciation periods are quarters with a rising value in the DXY Index. The DXY Index measures the value of the U.S. dollar relative to major developed market currencies, notably the euro, the 78 78 Japanese yen, and the British pound.

79 U.S. dollar and EM currency divergence EMERGING MARKET CURRENCIES VERSUS U.S. DOLLAR COMPOSITE INDEX 25 ECONOMY 20 EQUITIES 15 FIXED 10 INCOME 5 year % REAL ASSETS -over- 0 Year ALTERNATIVE -5 INVESTMENTS -10 CURRENCIES -15 ASSET ALLOCATION -20 -25 DISCLOSURES '13 '14 '15 '16 '17 '18 '19 '07 '08 '09 '10 '11 '12 U.S. Trade Weighted Dollar Index JP Morgan Emerging Markets Currency Index Sources: Bloomberg and Wells Fargo Investment Institute, as of March 31, 2019. Shaded areas represent periods of a U.S. economic recession. The U.S. Trade Weighted Dollar Index is a weighted average of the foreign exchange value of the U.S. dollar against a subset of the broad index currencies that circulate widely outside the country of issue. Major currencies index includes the Euro Area, Canada, Japan, Uni ted Kingdom, Switzerland, Australia, and Sweden. The J.P. Morgan Emerging Market Currency Index tracks the performance of emerging market currencies relative to the U.S. dollar. KEY TAKEAWAYS • Resilient global growth prospects and a more dovish Fed should support emerging market currencies and offs et concerns about a potential protectionist trade policy. • Despite the risks from trade conflicts and political transitions in certain countries, we believe that an env ironment of continued global economic growth will support emerging market currencies. 79 79

80 allocation highlights Asset Background ECONOMY Historical p • erformance may serve as a useful guide for investors, but markets frequently trade on factors outside of fundamental valuations for long periods of EQUITIES time. FIXED Benefits of d iversification and rebalancing INCOME r Regularly • ebalancing a portfolio can add value. REAL ASSETS Because each asset class has unique risk, return, and correlation characteristics, • a with diversified portfolio has the potential to provide more consistent returns ALTERNATIVE INVESTMENTS lower volatility. CURRENCIES t Attempting • - term performance, as o reduce downside volatility is critical to long recover quicker it can allow a portfolio to in the event of a catastrophic event. ASSET ALLOCATION ortant to recognize that the more you lose in a downturn, the longer it • It’s imp takes to recoup those losses . DISCLOSURES Dangers of market t iming • Missing even a handful of days when the market achieves its best gains can amatically reduce returns . dr not advocate market timing, but we do believe that modest tactical shifts do • We have the potential to take advantage of short - term investment opportunities or - term risks. help mitigate short 80 80

81 Asset allocation scorecard 4Q18 Jan. 2019– YoY return YTD return return Feb. 2019 (%) (%) ECONOMY (%) return (%) Moderate Income four- asset group without -2.37 3.90 3.90 3.01 EQUITIES private capital FIXED Moderate Growth and INCOME Income four-asset 7.52 -7.20 7.52 2.76 group w/o private capital REAL ASSETS Moderate Growth four- asset group without 10.28 10.28 -10.99 2.02 ALTERNATIVE INVESTMENTS private capital 60% MSCI ACWI/40% CURRENCIES Bloomberg Barclays 0.04 6.99 -7.18 6.99 Multiverse 60% S&P 500 ASSET ALLOCATION Index/40% Bloomberg 7.29 4.59 7.29 -7.46 Barclays U.S. Aggregate Bond Index DISCLOSURES Sources: Bloomberg and Wells Fargo Investment Institute, as of February 28, 2019. YoY = year over year. YTD = year to date. Performance results for the Moderate Income, Moderate Growth and income and 60/40 portfolios are hypothetical and for illustrative purposes . Index returns do not represent investment performance or the results of actual trading. Index returns reflect general market results; only assume the reinvestment of dividends and other distributions; and do not reflect deductions for fees, expenses, or taxes applicable to an actual investment. Unlike most asset-class indices, HFR index returns are net of all fees. Because the HFR indices are calculated based on information that is voluntarily provided, actual returns may be higher or lower than those reported. An index is unmanaged and not available for direct investment. Hypothetical and past performance does not guarantee future results. Compositions of the Moderate Income, Moderate Growth and Income, Moderate Growth Four-Asset Group without PC, and 60/40 are provided on page 102. KEY TAKEAWAYS • A diversified portfolio helps smooth out returns over time. • Adding real assets and alternative investment strategies can help enhance returns and mitigate risk over a tradit ional portfolio consisting of stocks and bonds. 81 81 Diversification strategies do not guarantee investment returns or eliminate the risk of loss.

82 may own assets The bucket list: why you ECONOMY Income Volatility Catastrophe U.S. IG bonds U.S. IG fixed income Cash EQUITIES yield fixed U.S. high- DM fixed income U.S. IG fixed income income Hedge funds Commodities FIXED Int’l bonds (DM/EM) INCOME Hedge funds Managed futures Large/Mid Cap equity Managed futures DM equity REAL ASSETS Real estate/REITs ALTERNATIVE INVESTMENTS CURRENCIES Growth Inflation Liquidity U.S. high- yield fixed TIPS or short -term fixed Cash ASSET income income ALLOCATION U.S. IG fixed income EM fixed income DM bonds DM fixed income U.S. equity DISCLOSURES Domestic equity Large Cap equity Int’l equity (DM/EM) Int’l equity (DM/EM) DM equity Real estate/REITs REITs Private equity Commodities Source: Wells Fargo Investment Institute, as of March 31, 2019. KEY TAKEAWAYS Certain asset classes can be appropriate under different circumstances or for different investment objectives. • Hedge Funds, Managed Futures, Real Estate, and Private Equity funds are not suitable for all investors and are only open to “accredited” or “qualified” investors within the meaning of U.S. securities laws. Equity , fixed income, foreign, cash alternatives, and alternative investments are materially different investments with materially different risk and reward characteristics. These risk and reward characteristic s should be evaluated carefully before making any investment decision. 82 82

83 lower returns for longer Expect WE ARE FORECASTING GENERALLY LOWER STRATEGIC (10 -15 YEARS) ECONOMY RETURNS THAN HISTORICAL AVERAGES 12% 10.2% EQUITIES 9.3% 8.9% 8% FIXED INCOME 5.8% 5.8% 5.1% 5.1% 4.1% REAL 3.4% 4% ASSETS 2.6% 2.5% 2.1% 2.0% 1.9% 1.8% 0.7% ALTERNATIVE 3.1% 2.9% 7.8% 7.5% 9.2% 7.2% 4.4% 2.5% INVESTMENTS 0% CURRENCIES -4% Cash Alternatives U.S. Taxable Public Real Estate Emerging Mkt Developed Mkt ex- Developed Mkt Ex- Commodities U.S. Large Cap ASSET Investment Grade Equities U.S. Fixed Income U.S. Equities Equities ALLOCATION Fixed Income Strategic hypothetical return (10 –15 years) Historical average return (1990 –current) –5 years) Cyclical hypothetical return (3 DISCLOSURES *Data from –3/31/2019 1/1/1991 Fargo Investment as of March 31, 2019. For illustrative purposes only. Cyclical Sources: FactSet, Morningstar Direct, and Wells Institute, Cyclical and strategic hypothetical returns return assumptions as of January 1, 2019. Strategic return assumptions are as of July 17, 2018. -looking estimates from Wells Fargo Investment Institute of how asset classes and combinations of classes may respond during are forward various market environments . Hypothetical returns do not represent the returns that an investor should expect in any particular year. They are not designed to predict actual performance and may differ greatly from actual performance. There are no assurances that any estimates given will be achieved. Historical average returns are for data from January 1991 to March 2019. An index is unmanaged and not available for direct investment. results. Past performance is no guarantee of future KEY TAKEAWAYS • Investors may need to consider saving more or spending less in this environment to reach their financial goals. Indices in order represented by Bloomberg Barclays U.S. Treasury Bill (1– 3 Month) Index , Bloomberg Barclays U.S. Aggregate Bond Total Return Index, JP Morgan GBI Global Ex U.S. Total Return Index, S&P 500 Total Return Index, MSCI EAFE Total Return Index, MSCI Emerging Index. Commodity Markets Total Return Index, FTSE EPRA/NAREIT Developed REITs Total Return Index, Bloomberg 83 83

84 rebalancing benefits Diversification and ECONOMY EQUITIES FIXED INCOME REAL ASSETS ALTERNATIVE INVESTMENTS CURRENCIES ASSET ALLOCATION DISCLOSURES Sources: Morningstar Direct and Wells Fargo Investment Institute, as of March 31 , 2019. Performance results for the Moderate Growth and Income 4AG portfolio private capital (PC) and the 60/40 portfolios are hypothetical and for illustrative purposes only. Index returns without do not represent actual performance or the results of actual trading. Index returns reflect general market results; do not reflect investment portfolio to an actual returns or the experience of any investor; and do not reflect the impact of any fees, expenses, or taxes applicable investment. lass indices, HFR index returns are net of all fees. Because the HFR indices are calculated based on most asset-c Unlike that is voluntarily provided, actual returns may be highe r or lowe r than those reported. An index is unmanaged and not information availabl e for direct investment. Hypothetical and past performance is no guarantee of future results . Composition of the Portfolios provide d on slide 102. KEY TAKEAWAYS • Regularly rebalancing a portfolio can add value. period. • The balanced portfolio that is rebalanced regularly outperformed all the others during this time 84 84 Diversification strategies do not guarantee investment returns or eliminate the risk of loss.

85 may reduce downside risk Diversification A DIVERSIFIED ALLOCATION MAY HELP LIMIT LOSSES IN DOWN MARKETS ECONOMY Oct 5, Feb 13, Nov 28, Aug 25, Jul 16, Jul 17, Mar 24, Nov 27, Oct 9, Apr 29, Apr 2, May 21, Jan 26, Sep 20, 1979– 1980– 1980– 1987– 1990– 1998– 2000– 2002– 2007– 2011– 2012– 2015– 2018– 2018– Oct 10, Apr 23, Nov 7, Mar 27, Aug 12, Dec 4, Oct 11, Aug 31, Oct 9, Mar 11, Mar 9, Oct 3, Jun 1, Feb 11, Feb 8, Dec 24, 1983– Jul 2010– Jul EQUITIES 1979 1980 1982 1987 1990 1998 2002 2003 2009 2011 2012 2016 2018 2018 24, 1984 2, 2010 0 -5 FIXED INCOME -10 -15 REAL ASSETS -20 -25 ALTERNATIVE INVESTMENTS -30 Return (%) -35 CURRENCIES -40 -45 ASSET -50 ALLOCATION -55 -60 DISCLOSURES S&P 500 Index Hypothetical Moderate Growth and Income 3AG portfolio Institute, as of March 31, 2019. Sources: Morningstar Direct and Wells Fargo Investment Performance results for the Moderate Growth and Income 3AG Portfolio is hypothetical and is presented for illustrative purposes only . Index returns investment performance or the results do not represent nd do not reflect of actual trading. Index returns reflect general market results, assume the reinvestment of dividends and other distributions, a investment . An index is unmanaged and not available for direct investment. deduction for fees, expenses or taxes applicable to an actual Hypothetical and past performance does not guarantee future results. Composition of the Portfolios provided on slide 102. Note: Corrections are declines of 10% or more. Bear markets are declines of 20% or more. KEY TAKEAWAYS A diversified allocation may not experience losses as sharp as an all -equity position during an equity • corre ction or bear market. • Attempting to reduce downside volatility is critical to long-term performance, as it can allow a portfolio to reco ver much quicker in the event of a catastrophic event. 85 85 Diversification strategies do not guarantee investment returns or eliminate the risk of loss.

86 Crisis events’ impact on performance GROWTH PORTFOLIOS MAY SEE THE BIGGEST DECLINE DURING CRISIS EVENTS ECONOMY 5 2% 1% EQUITIES 0% 0% 0 -1% -1% -1% -1% FIXED -2% INCOME -3% -3% -3% -4% -5 -4% -6% REAL return (%) -7% -7% ASSETS -10 -9% -11% ALTERNATIVE Cumulative INVESTMENTS -15 -14% CURRENCIES -19% -20 Teck wreck: April 7– 14, Sept. 11 –Sept. 21, 2001 Financial crisis: Sept. -off: Aug. 23 – Gulf War 2: March 1– Bond sell -off: June 14 – Subprime debacle: June Equity sell ASSET July 31, 2003 Oct. 9, 2002 15– Aug. 15, 2007 2000 12– Oct. 15, 2008 23, 2003 ALLOCATION DISCLOSURES Moderate Growth 3AG portfolio Moderate Income 3AG portfolio Moderate Growth and Income 3AG portfolio March 31, 2019. Performance for the Moderate Income, Moderate Growth Sources: Morningstar Direct and Wells Fargo Investment Institute, as of Index returns do not represent investment and income, and Moderate Growth 3AG Portfolios are hypothetical and for illustrative purposes only. performance or the results of actual trading. Index returns reflect general market results, assume the reinvestment of dividends and other distributions, and do not reflect deduction for fees, expenses or taxes applicable to an actual investment. An index is unmanage d and not available for direct investment. Hypothetical and past performance is no guarantee of future results. Composition of the Portfolios provided on slide 102. KEY TAKEAWAYS • During certain historical crisis events, growth -oriented allocations declined the most, income -oriented allocations tended to decline the least, and growth -and -income -oriented allocations experienced moderate declines. had a bigger impact. Growth allocations tend to rise more over time, but crisis events have • 86 86

87 improve risk- Diversification may returns adjusted ECONOMY CAN REDUCE OVERALL RISK WITHOUT SACRIFICING TOO A DIVERSIFIED PORTFOLIO MUCH RETURN EQUITIES 16 14.47% 14 FIXED INCOME 12 REAL 9.24% ASSETS 10 8.98% 8 ALTERNATIVE 6.65% 6.54% Percent INVESTMENTS 5.62% 6 CURRENCIES 4 2 ASSET ALLOCATION 0 MGI 3AG 2017 S&P 500 Index MGI 4AG w/o PC 2017 DISCLOSURES 20-year annualized return 20-year annualized standard deviation Morningstar Sources: Direct and MGI 3AG Portfolios Wells Fargo Investment Institute, January 1, 1999 –December 31, 2018. Performance for the MGI 4AG w/o PC and the are hypothetical and for illustrative purposes only. Index returns do not represent investment or the results of actual trading. Index returns reflect general performance fees, expenses or taxes applicable to an actual investment. market results, assume the reinvestment of dividends and other distributions, and do not reflect deduction for are net of all fees. Because the HFR indices are calculated based on information that is voluntarily provided actual Unlike most asset class indices, HFR Index returns returns may be lower than those reported. An index is unmanaged and not available for direct investment. Hypothetical and past performance does not guarantee future results. Standard deviation is a measure of the volatility of returns. The higher the standard deviation, the greater volatility has been. The risk associated with the representative asset classes and the definitions of the indices are provided . Diversification does not guarantee investment returns or eliminate risk at the end of the report of loss. Composition of the Portfolios provided on slide 102. KEY TAKEAWAYS • Over time, a diversified portfolio can help mitigate volatility during times of market uncertainty and help smo oth returns. • Real assets and alternative investments add an element of diversification to a traditional portfolio comprised of s tocks and bonds. 87 87 Diversification strategies do not guarantee investment returns or eliminate the risk of loss.

88 The more you lose, the longer it takes to break even PERIODS NECESSARY TO BREAK EVEN GIVEN ECONOMY The more you lose, the longer it takes to break even TO BREAK EVEN IN ONE PERIOD A PERCENTAGE RETURN OF You need ... If you lose 10% 5% 1% EQUITIES 11.1% 10% 10.6 1.1 2.2 3.0 25% 33.3% 28.9 5.9 FIXED INCOME 50% 7.3 14.2 69.7 100% 18.8 60% 150% 92.1 9.6 REAL ASSETS 16.9 33.0 80% 161.7 400% 400 ALTERNATIVE INVESTMENTS 500 400 CURRENCIES 300 150 100 200 ASSET ALLOCATION 33.3 100 11.1 0 DISCLOSURES -80 -10 -25 -50 -60 Return needed to break even (%) -100 Percentage loss (%) Source: Wells Fargo Investment Institute, as of March 31, 2019. For illustrative purposes only. There is no guarantee it will be possible to break even. All investing involves risk including the possible loss of principal. Past performance is no guarantee of future results. KEY TAKEAWAYS • It’s important to recognize that the more you lose in a downturn, the longer it takes to recoup those losses. 88 88

89 is risky market Timing the AVERAGE EQUITY FUND INVESTOR UNDERPERFORMED BENCHMARK 2017) (1998– ECONOMY 8 EQUITIES 7 7.20% FIXED 6 INCOME 5 5.29% REAL ASSETS 4 Percent ALTERNATIVE 3 INVESTMENTS 2 CURRENCIES 2.15% 1 ASSET ALLOCATION 0 Inflation S&P 500 Index Average investor return DISCLOSURES Source: Dalbar, Inc ., 20 years from 1998– 2017; “Quantitative Analysis of Investor Behavior,” 2018, DALBAR, Inc., www.dalbar.com. For illustrative purposes only. Dalbar average stock fund investor return by using industry cash flow reports from the Investment computed the average stock fund return figure represents the average return for all funds listed in Lipper’s U.S. Diversified Equity fund Company Institute. The classification model. All Dalbar returns were computed using the S&P 500 Index. Returns assume reinvestment of dividends and cap ital gain distributions. The fact that buy and hold has been a successful strategy in the past does not guarantee that it will continue to be successful in the future. The performance shown is not indicative of any particular investment. Past performance is not a guarantee of future results . KEY TAKEAWAYS • Market timing is difficult. Investors who allow their emotions to get the best of them can suffer lower returns . 89 89

90 market is risky Timing the MISSING THE BEST DAYS IN THE MARKET IS COSTLY 1989 –2018) annual S&P 500 price return ( Average ECONOMY 9 EQUITIES 7.61% 8 7 FIXED INCOME 6 5.16% REAL 5 ASSETS 4 3.50% ALTERNATIVE Percent INVESTMENTS 3 2.07% 2 CURRENCIES 0.75% 1 ASSET ALLOCATION 0 -0.47% -1 DISCLOSURES Missing 30 best Missing 10 best Remain fully Missing 40 best Missing 20 best Missing 50 best days days days days invested days $3.9M $7.2M (starting with $1M) (starting with $1M) Sources: Morningstar Direct and Wells Fargo Investment Institute, as of December 31, 2018. For illustrative purposes only. The S&P 500 Index is a market capitalization weighted index composed of 500 stocks generally considered representative of the U.S. stock mar ket. An index is unmanaged and not available for direct investment. A price index is not a Past performance is no guarantee of future results. total return index and does not include the reinvestment of dividends. KEY TAKEAWAYS • We do not advocate market timing, but we do believe that modest tactical shifts have the potential to take advant age of short -term investment opportunities or help mitigate short- term risks. • Exiting the market after a bad day could be costly. The stock market’s best days are often preceding by the wors t days. Missing even a handful of days when the market achieves its best gains can dramatically reduce 90 90 returns.

91 Behavioral biases could be costly CHASING PAST WINNERS OR LOSERS HAS NOT BEEN A SUCCESSFUL ECONOMY STRATEGY $350 $300 EQUITIES $250 FIXED INCOME $200 $150 REAL ASSETS $100 ALTERNATIVE INVESTMENTS $50 $0 CURRENCIES '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 Hypothetical top performer portfolio MGI 4AG w/o Private Capital portfolio Hypothetical bottom performer portfolio ASSET ALLOCATION Sources: Morningstar Direct, Wells Fargo Investment Institute; December 31, 2018. Indexed to 100 as of December 31, 2001. The top performer portfolio consists of the top performing asset class of the previous year invested 100% in the portfolio in the current year. The bottom performer DISCLOSURES ar. Portfolio compositions portfolio consists of the bottom performing asset class of the previous year invested 100% in the portfolio in the current ye on slide 102. Performance results for the Moderate Growth & Income 4 Asset Group without Private Capital Portfolio and the top and are provided performer portfolios are hypothetical and do not represent an actual portfolio in existence now or during the time period shown. Index return bottom- of actual trading. Index information is provided for illustrative purposes only. Index returns do not represent investment performance or the results returns represent general market results, assume the reinvestment of dividends and other distributions and do not reflect ded uct ion for fees, expenses or taxes applicable to an actual investment. Hypothetical and past performance is no guarantee of future results. Unlike most asset is voluntarily provided class indices, HFR Index returns reflect deduction for fees. Because the HFR indices are calculated based on information that Hypothetical and past actual returns may be lower than those reported. An index is unmanaged and not available for direct investment. performance do not guarantee of future results. Please see the end of the presentation for the composition of the MGI w/o PC Portfolio the risks associated with the representative asset classes and the definitions of the indices. KEY TAKEAWAYS -performing investment is a strategy that • Chasing the previous year’s top -performing asset class or worst some investors have tended to follow. • We found that following the best -performing asset class (hot -hand fallacy) and worst -performing inve . stment (gambler’s fallacy) did not result in better performance than a diversified portfolio 91 91 Diversification strategies do not guarantee investment returns or eliminate the risk of loss.

92 over time Asset values have grown HYPOTHETICAL GROWTH OF $1 MILLION INVESTED IN EACH OF ECONOMY THE ASSET CLASSES SHOWN $100,000M $37,782 M EQUITIES $10,000M $7,996 M FIXED INCOME $1,000M $148 M REAL ASSETS $100M $21 M ALTERNATIVE $10M INVESTMENTS $14 M CURRENCIES $1M ASSET $0M ALLOCATION '54 '58 '62 '66 '70 '74 '78 '82 '86 '90 '94 '98 '02 '06 '10 '14 '18 '26 '30 '34 '38 '42 '46 '50 DISCLOSURES Small-company stocks Large-company stocks Government bonds Treasury bills Inflation Sources: Wells Fargo Investment Institute, as of March 31 , 2019. Small- company stocks: IA SBBI U.S. Small Stock Direct and Morningstar -Term Government Bond Index. -company stocks : S&P 500 Index. Government bonds: IA SBBI U.S. Long Index. Treasury bills: Large IA SBBI U.S. 30 -Day Treasury Bill Index. Inflation: IA SBBI U.S. Inflation Index. For illustrative purposes only. Index returns do not represent investment or the results of actual trading. Index returns reflect general market results, assume the reinvestment of performance dividends and other distributions, and do not reflect deduction for fees, expenses or taxes applicable to an actual investment. An index is unmanaged and not available for direct investment. Hypothetical and past performance is no guarantee of future results. KEY TAKEAWAYS • Since 1926, riskier assets have outperformed less risky assets. -bill yields have • U.S. Treasury bills have tracked inflation fairly closely over this time frame. More recently, T bee n lower than inflation. 92 92

93 Net flows of mutual funds (MFs) and exchange-traded funds (ETFs) YTD ECONOMY Billions ($) 2010 2011 2018 2017 2016 2015 2014 2013 2012 2019 -170 -81 -134 -7 -253 -236 -235 -159 -60 18 MF Domestic EQUITIES equity ETF 132 70 170 -16 129 188 69 1 39 3 33 71 23 111 5 84 MF Int’l FIXED INCOME equity ETF 8 69 160 21 109 46 REAL 7 EM equity 3 13 -4 -4 3 33 17 12 27 ASSETS 32 -13 16 -40 221 130 84 233 -2 256 MF Taxable ALTERNATIVE ETF bond 48 51 92 116 77 24 INVESTMENTS Government 12 7 6 2 11 4 6 -51 34 3 CURRENCIES bond High-yield 19 22 35 56 -2 -34 -18 7 -36 -44 bond ASSET ALLOCATION 28 12 18 4 26 23 15 -12 -58 50 Tax-exempt MF DISCLOSURES ETF bond 0 6 5 6 4 3 Money market 90 107 -30 46 21 6 15 0 -124 -525 Sources: FactSet and Wells Fargo Investment Institute, as of February 28, 2019. Data compiled by Investment Company Institute (ICI). For illustrative purposes only. Data represents net new cash flows of mutual funds and net issuance of shares of ETFs. Numbers rounded to the nearest billion. For number of funds in each category according to ICI please refer to https://www.ici.org/research/stats/trends/trends_02_19. For definitions and components of each category according to ICI please refer to https://www.ici.org/research/stats/iob_update/iob_definitions. KEY TAKEAWAYS • U.S. equity outflows have outpaced taxable bond flows over the past three years. Mutual fund investors have continued to reduce their U.S. equity allocations this year. This has been an • ongoin g trend since 2014. 93 93

94 Asset performance—correlations U.S. HY DM Public Municipal DM Ex- U.S. MC U.S. SC U.S. LC EM Hedge Cash Taxa ble Taxable EM FI Ex-U.S . Commodity Real FI FI U.S. ties Equities Equities Equi Equi ties Funds ECONOMY IG FI FI Equities Estate Cash 0.12 0.13 0.13 0.23 0.02 0.15 0.00 0.07 1.00 0.20 0.08 0.00 0.19 0.00 - - - - - - U.S. Taxable IG FI EQUITIES 0.29 0.23 0.28 1.00 0.77 0.11 0.02 0.32 0.08 0.41 0.37 0.42 0.57 - - - - - - - - - Municipal FI 0.00 0.03 0.04 0.23 0.10 0.16 0.08 1.00 0.16 0.41 0.50 0.16 - - - - FIXED HY Taxable FI 0.67 0.02 0.71 0.70 0.74 1.00 0.68 0.76 0.70 0.50 0.75 - INCOME DM Ex-U.S. FI 0.27 1.00 0.10 0.12 0.15 0.15 0.07 0.18 0.14 0.06 - - - - EM FI 0.59 0.42 0.57 1.00 0.48 0.54 0.44 0.51 0.63 REAL ASSETS U.S. LC Equities 0.36 0.80 0.88 0.76 0.82 1.00 0.96 0.93 U.S. MC Equities ALTERNATIVE 0.89 1.00 0.95 0.81 0.83 0.90 0.46 INVESTMENTS U.S. SC Equities 0.78 1.00 0.84 0.83 0.77 0.34 DM Ex-U.S. CURRENCIES 0.48 1.00 0.88 0.80 0.87 Equities EM Equities 0.90 1.00 0.71 0.52 ASSET Public Real Estate 1.00 0.46 0.71 ALLOCATION Commodity 1.00 0.58 Hedge Funds DISCLOSURES 1.00 Source: Wells Fargo Investment Institute, January 1, 2000 to December 31, 2018. For illustrative purposes only. Correlation measures the degree to which asset classes move in sync; it does not measure the magnitude of that movement. There is no guarantee that future correlations between the indices will remain the same. Index returns do not represent investment performance or the results of actual trading. Index returns reflect general market results, assume the reinvestment of dividends and other distributions and do not reflect deduction for fees, expenses or taxes applicable to an actual investment. Unlike most asset class indices, HFR Index returns are net of all fees. Because the HFR indices are calculated based on information that is voluntarily provided, actual returns may be lower than those reported. An index is unmanaged and not available for direct investment. Index correlations represent past performance. Past performance is no guarantee of future results. KEY TAKEAWAYS • Correlations play an important role in portfolio diversification. In addition to risk and return, correlations are primary components of portfolio construction. Indices in order represented by Bloomberg Barclays U.S. Treasury Bill 1–3 Month TR USD, Bloomberg Barclays U.S. Agg Bond TR USD, Bloomberg Barclays U.S. Municipal Index TR USD, Bloomberg Barclays U.S. Corporate High Yield Bond TR USD, Bloomberg Barclays High Yield Muni Index TR USD, JPM GBI Global Ex U.S. TR USD, JPM EMBI Global TR USD, IA SBBI S&P 500 TR USD, Russell Mid Cap, Russell 2000, MSCI EAFE GR USD, MSCI EM GR USD, FTSE EPRA/NAREIT Developed TR USD, Bloomberg Commodity Index, HFRI Fund Weighted Index. IG = investment grade. FI = fixed income. LC = large cap. MC = 94 94 mid cap. SC = small cap. HY = high yield. DM = developed market. EM = emerging market.

95 Finding balance between risk and reward VERSUS 15 YEARS RISK: PERFORMANCE ECONOMY (March 2004– 2019) March 12 EQUITIES 10 U.S. Mid Cap Equities U.S. Small Cap Equities FIXED U.S. Large Cap Equities INCOME Emg Mkt Equities 8 Public Real Estate High Yield FI Emg Mkt FI Hypothetical Moderate 6 REAL -U.S. Equities Dev Mkt Ex Growth and Income 4AG ASSETS portfolio w/o PC Hedge Funds 4 total return (%) U.S. Inv Grade FI ALTERNATIVE -U.S. FI Dev Mkt Ex INVESTMENTS 2 Annualized CURRENCIES 0 -2 ASSET Commodities ALLOCATION -4 10 15 25 5 0 20 DISCLOSURES Annualized standard deviation (%) (from lower risk to higher risk) Sources: Morningstar Direct and Wells Fargo Investment Institute, as of March 31 , 2019. Performance results for the MGI 4AG w/o PC do not represent Portfolio and is for illustrative purposes only. Index returns is hypothetical investment performance or the results of actual the reinvestment trading. Index returns reflect general market results, assume and do not reflect of dividends and other distributions, deduction for fees, expenses to an actual investment. Unlike most asset class indices, HFR Index returns are net of all fees. or taxes applicable the HFR indices returns based on information that is voluntarily provided actual Because may be lower than those reported. An are calculated is no index is unmanaged Hypothetical and past performance direct investment. guarantee of future results . and not available for Standard deviation is a measure of the volatility of returns. The higher the standard deviation, the greater volatility has been. Composition of the MGI 4AG w/o PC provided on slide 102. KEY TAKEAWAYS • A diversified portfolio a good balance between risk and return. may strike the risk of loss. Diversification strategies do not guarantee investment returns or eliminate U.S. Investment Grade FI = Bloomberg Barclays U.S . Indices represented: Aggregate Bond Index. Hedge Funds = HFRI Fund Weighted Index. Emerging Market FI = JP Morgan EMBI Global Index. High Yield FI = Bloomberg Barclays U.S. Corporate HY Bond U.S. Mid Cap Equities = Russell Midcap Index. U.S. Small Cap Equities = Russell 2000 Index. Developed Market Ex- U.S . FI = JP Morgan Index. Emerging Market Equities = MSCI Index. U.S. Large Cap Equities = S&P 500 Index. Developed Market Ex- U.S. Equities = MSCI EAFE Index. GBI Global Ex U.S. Index. Commodities = Bloomberg Commodity Emerging Markets Index. Public Real Estate = FTSE EPRA/ NAREIT Developed REITs Index. 95 95

96 the Fed Don’t fight UNDERSTANDING FED POLICY AND ASSET PERFORMANCE 25 ECONOMY 20.9% 20 17.4% 17.3% 16.9% EQUITIES 16.5% 16.3% 14.9% 14.6% 13.6% 15 FIXED INCOME 10 8.4% 7.3% REAL 6.1% 5.9% 5.4% ASSETS 4.7% 3.9% 5 2.9% 1.9% Total return (%) 0.9% ALTERNATIVE 0.1% INVESTMENTS 0 5.1% 1.6% 3.3% 0.6% 0.4% 2.8% 0.0% CURRENCIES -5 -3.8% ASSET -10 ALLOCATION Bloomberg Barclays Bloomberg Barclays Russell 2000 Index Global REITs Bloomberg Barclays Russell Midcap S&P 500 Index 1–3 Month High Yield Index U.S. Aggregate DISCLOSURES Jan. 2009– Nov. 2014– Nov. 2015 annualized total return (Fed tapering policy) Oct. 2014 annualized total return (Fed easing policy) Dec. 2018 annualized total return (Fed raising interest rates) Jan. 2019– Mar. 2019 (Fed pauses raising interest rates) Dec. 2015– obal REITs represented Sources: Morningstar Direct and Wells Fargo Investment Institute, as of December 31, 2018. For illustrative purposes only. Gl by FTSE EPRA/NAREIT Developed Index. Bloomberg Barclays High Yield represented by Bloomberg Barclays U.S. Corporate High Yield Bond Index. only. Index returns do not represent investment performance or the results of actual trading. Index returns reflect general market results, assume the reinvestment of dividends and other distributions, and do not reflect deduction for fees, expenses or taxes applicable to An an actual investment. index is unmanaged and not available for direct investment. Past performance is no guarantee of future results . There is no guarantee any asset class will perform in a similar manner in the future. KEY TAKEAWAYS • As the next phase of monetary policy unfolds, our expectation is for investment gains to moderate from unsusta inable levels experienced during the Fed’s quantitative easing period to more normalized returns with the potential for higher volatility . t its March 2019 meeting, the Fed indicated it would not raise rates in 2019. While the Fed suggested that it • A 96 96 could r aise rates once more in 2020 or 2021, we believe the current Fed rate hike cycle has come to an end.

97 speaking... Broadly IN 13 OF THE PAST 20 YEARS BROAD DIVERSIFICATION STRATEGIES OUTPERFORMED ECONOMY 30 300 EQUITIES 263% 20 250 FIXED INCOME 10 197% 200 REAL ASSETS 0 150 ALTERNATIVE Annual return (%) -10 INVESTMENTS 100 Cumulative total return (%) -20 CURRENCIES 50 -30 ASSET ALLOCATION 2008 2016 2015 2014 2009 2018 1999 2000 2001 2002 2003 2004 2005 2006 2007 2017 2013 2010 2011 2012 0 MGI 4AG w/o PC MGI 4AG w/o PC 60% S&P 500 Index/40% Bloomberg Barclays U.S. DISCLOSURES 60% S&P 500 Index/40% Bloomberg Barclays U.S. Aggregate Bond Index Aggregate Bond Index w/o PC Morningstar Sources: Institute, as of December 31, 2018. Performance results for the MG&I 4AG Direct and and the Wells Fargo Investment 60% S&P 500 Index/40% Bloomberg Barclays Aggregate Bond Index Portfolios are hypothetical and for illustrative purposes only. Index returns do not represent investment performance or the results of actual trading. Index returns reflect general market results, assume the reinvestment of dividends and other distributions and do not reflect deduction for fees, expenses or taxes applicable to an actual investment. Unlike most asset class indices, HFR Index returns are net of all fees. Because the HFR indices are calculated based on information that is voluntarily provided actual returns may be lower than those reported. An index is unmanaged and not available for direct investment. Hypothetical and past performance is no guarantee of future results . Composition of the Portfolios provided at the end of this presentation. KEY TAKEAWAYS • Historical performance may serve as a useful guide for investors, but markets frequently trade on factors de of fundamental valuations for long periods of time. outsi 97 97 Diversification strategies do not guarantee investment returns or eliminate the risk of loss.

98 Four-asset group w/o private capital— moderate growth and income '04-'18 2018 YTD average 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2004 2005 2006 2007 ECONOMY Public Real US Small Emg Mkt Emg-Mkt Public Real US Small Emg Mkt Dev ex US Public Real Emg Mkt Emg Mkt US Small US Large Public Real US Small US Mid Cap CPI Fixed Inc Equity Equity Estate Estate Equity Fixed Inc Cap Equity Cap Equity Estate Equity Estate Cap Equity Cap Equity Cap Equity Equity 2.2% 21.3% 38.0% 34.5% 28.7% 8.5% 11.4% 39.8% 37.8% 42.4% 38.8% 79.0% 1.4% 17.0% 15.9% 26.9% 8.9% US Large High Yield Emg Mkt US Mid Cap Emg Mkt High Yield Emg Mkt Emg Mkt Inv Grade US Mid Cap US Mid Cap Dev ex US Inv Grade Cash Emg-Mkt Commod Commod Alternative Fixed Inc Equity Fixed Inc Equity Fixed Inc Equity Equity Fixed Inc Equity Equity Fixed Inc Equity Cap Equity Equity EQUITIES 16.2% 21.4% 13.7% 18.6% 25.5% 17.1% 58.2% 34.8% 25.6% 5.2% 7.8% 1.8% 32.6% 1.2% 15.5% 26.0% 8.3% US Mid Cap US Large Emg-Mkt Dev ex US Cash US Mid Cap US Large Public Real Dev ex US Public Real US Large US Mid Cap 60%,40% Dev ex US US Large Dev ex US Inv Grade Cap Equity Equity Equity Cap Equity Equity Equity Estate Portf Equity Estate Cap Equity Fixed Inc Fixed Inc Alternative Equity Fixed Inc Cap Equity FIXED 21.8% 13.8% 40.5% 11.6% 18.5% 20.7% 26.9% 32.4% 20.4% 1.8% 0.0% 13.2% 15.4% 11.5% 5.9% 1.2% 7.8% INCOME Public Real US Mid Cap Public Real Dev ex US US Small Dev ex US Dev ex US US Mid Cap 60%,40% Public Real US Large Emg Mkt Dev ex US Dev ex US High Yield CPI CPI Fixed Inc Fixed Inc Estate Estate Cap Equity Equity Estate Equity Fixed Inc Portf Equity Equity Equity Cap Equity Equity 0.7% 0.1% 23.3% 19.2% 17.9% 38.3% 10.6% 12.0% 11.3% 18.5% 18.4% 14.0% -1.7% 20.2% 5.0% 10.8% 7.6% High Yield Mod Grwth US Small US Large Inv Grade 60%,40% Dev ex US Emg-Mkt Dev ex US US Mid Cap US Small US Small 60%,40% US Mid Cap Hedge REAL Commod Commod Funds Equity Equity Cap Equity Portf Cap Equity Fixed Inc Fixed Inc Fixed Inc Cap Equity Portf Equity Cap Equity Inc Portf Equity ASSETS 11.8% 16.8% 10.0% -10.9% 5.0% 32.5% 14.6% 17.7% 0.5% -2.1% 17.3% 15.8% 9.3% 12.7% 18.3% 7.5% 6.6% Emg-Mkt High Yield Mod Grwth 60%,40% 60%,40% Emg-Mkt Emg Mkt Public Real US Mid Cap Inv Grade Mod Grwth Mod Grwth US Small High Yield Emg Mkt Hedge CPI Funds Fixed Inc Equity Fixed Inc Portf Fixed Inc Inc Portf Inc Portf Cap Equity Portf Equity Inc Portf Fixed Inc Equity Fixed Inc Estate 3.0% ALTERNATIVE -19.0% 15.3% 11.6% 13.1% 16.3% 14.3% 10.7% 0.1% -2.3% 6.0% 7.4% 9.0% 12.1% 28.2% 7.0% 15.1% INVESTMENTS Cash Emg-Mkt Emg-Mkt Mod Grwth Dev ex US Inv Grade Mod Grwth 60%,40% Emg-Mkt US Small US Large US Large US Large Mod Grwth Hedge Hedge Hedge Funds Funds Funds Inc Portf Fixed Inc Cap Equity Portf Inc Portf Cap Equity Fixed Inc Fixed Inc Cap Equity Fixed Inc Inc Portf Fixed Inc Alternative Cap Equity 9.1% -4.1% 9.3% 27.2% 10.2% 2.1% 15.1% 13.2% 0.0% -21.6% 5.5% 7.0% 14.5% 7.5% 16.0% 12.0% 6.9% 60%,40% High Yield Emg-Mkt 60%,40% Mod Grwth Dev ex US High Yield US Large Emg-Mkt Mod Grwth Public Real US Large Mod Grwth Mod Grwth Mod Grwth US Small Hedge CURRENCIES Funds Cap Equity Portf Cap Equity Inc Portf Fixed Inc Inc Portf Fixed Inc Portf Inc Portf Equity Fixed Inc Fixed Inc Estate Inc Portf Cap Equity Inc Portf 12.9% 7.4% 14.6% 26.5% 9.0% -24.3% 6.3% 11.4% -0.4% 7.9% -4.4% 11.7% 7.3% 4.9% 6.5% 15.8% 0.8% High Yield Emg-Mkt US Large Dev ex US High Yield 60%,40% 60%,40% Public Real High Yield Mod Grwth Mod Grwth Mod Grwth 60%,40% Cash Hedge Hedge Commod Funds Funds Portf Estate Portf Inc Portf Inc Portf Fixed Inc Alternative Fixed Inc Fixed Inc Portf Cap Equity Fixed Inc Fixed Inc Inc Portf 6.5% ASSET -1.1% 3.0% 26.0% 6.2% 8.2% 11.1% 4.4% 9.9% 12.2% 11.8% -4.6% -26.2% 0.1% 4.9% 12.6% 6.5% ALLOCATION US Large US Small 60%,40% High Yield US Mid Cap US Small High Yield Mod Grwth Mod Grwth Dev ex US 60%,40% Emg-Mkt US Mid Cap Emg-Mkt Hedge Hedge CPI Funds Funds Equity Fixed Inc Inc Portf Cap Equity Equity Fixed Inc Cap Equity Portf Inc Portf Portf Equity Cap Equity Fixed Inc Fixed Inc 1.5% 5.4% 20.0% 5.6% -1.5% 12.0% 2.5% -33.8% -1.9% -4.7% 11.1% 4.6% 6.3% 10.9% 5.2% 11.4% 9.3% Cash 60%,40% Public Real US Small Emg-Mkt US Mid Cap Public Real US Large Emg-Mkt Hedge Hedge Hedge Hedge DISCLOSURES Commod CPI Commod Commod Funds Funds Funds Funds Fixed Inc Portf Alternative Cap Equity Estate Cap Equity Equity Estate Fixed Inc 9.1% 0.8% 18.9% -35.6% 4.5% 6.4% 10.2% 8.6% -4.2% -2.4% 5.0% 0.0% 5.5% 5.1% 9.9% 3.9% -4.7% Inv Grade Inv Grade US Mid Cap US Small Inv Grade 60%,40% Cash Dev ex US High Yield Cash US Large Inv Grade Dev ex US Hedge Hedge Hedge CPI Funds Funds Funds Fixed Inc Equity Alternative Portf Fixed Inc Fixed Inc Cap Equity Fixed Inc Equity Alternative Cap Equity Fixed Inc Fixed Inc 3.4% 9.0% -5.3% 4.9% -4.4% 4.2% 3.9% -9.1% 2.6% 18.5% 4.8% 7.5% -37.0% -2.0% 0.0% 6.8% 8.2% Emg Mkt Cash Inv Grade Dev ex US Cash US Small High Yield US Mid Cap Emg Mkt Inv Grade Public Real Dev ex US 60%,40% CPI CPI CPI CPI Equity Fixed Inc Estate Fixed Inc Fixed Inc Equity Cap Equity Alternative Fixed Inc Equity Portf Fixed Inc Alternative 2.1% 1.7% 0.1% 4.1% -11.0% -4.5% -5.8% 3.5% 6.8% 5.9% -2.3% -41.5% 4.8% 3.0% 8.4% 3.0% -1.8% Inv Grade High Yield Dev ex US Inv Grade Dev ex US High Yield Dev ex US Dev ex US Dev ex US Dev ex US Inv Grade Dev ex US Dev ex US Inv Grade CPI CPI Commod Fixed Inc Fixed Inc Fixed Inc Fixed Inc Fixed Inc Fixed Inc Equity Fixed Inc Fixed Inc Equity Fixed Inc Fixed Inc Fixed Inc Fixed Inc 2.1% -11.2% 2.1% 4.3% -43.1% 1.9% 1.9% -5.1% 6.5% -4.8% 2.7% 4.3% 1.0% 3.9% -11.7% -2.5% 0.8% Dev ex US Emg Mkt US Small Public Real Dev ex US Dev ex US Dev ex US Emg-Mkt Cash Cash Inv Grade CPI Commod CPI CPI CPI Commod Alternative Fixed Inc Fixed Inc Equity Fixed Inc Equity Equity Equity Cap Equity Alternative Estate 1.5% 1.7% -13.3% 2.7% 2.5% 3.3% 1.5% -6.6% 1.3% -1.6% -4.5% -13.4% 0.1% -14.6% 0.6% 2.4% -47.7% Cash Cash Cash Cash Emg Mkt Public Real Emg Mkt Dev ex US Emg Mkt Cash Cash Commod Commod Commod Commod Commod Commod Equity Equity Alternative Alternative Equity Alternative Alternative Estate Fixed Inc Alternative Alternative -17.0% -2.5% -24.7% 2.1% -9.5% -1.1% -53.2% 0.3% 0.8% 0.1% 0.1% -14.2% -18.2% -7.0% 0.4% -9.2% 1.2% Data as of 2/28/2019 Sources: Morningstar Direct and Wells Fargo Investment Institute. Average is calculated as geometric mean. Average is calculated as 15 years from 98 2004–2018. Portfolios are rebalanced quarterly. The moderate growth and income and 60/40 portfolios are hypothetical. Hypothetical and past 98 performance does not guarantee future results. An index is unmanaged and not available for direct investment.

99 Index definitions Hypothetical results for the MGI 4AG w/o private capital and 60/40 portfolios are hypothetical and for illustrative purposes only. Performance results do not represent actual trading, and the results achieved do not represent the experience of any individual investor. In addition, hypothetical results do not reflect the asset impact of any fees, expenses, or taxes applicable to an actual investment. Unlike most returns are net of all fees. -class indices, HFR index The indices reflect the historical performance of the represented assets and assume the reinvestment of dividends and other distributions. An index is unmanaged and not ECONOMY available for direct investment. Hypothetical and past performance does not guarantee future results . Definitions of the indices and descriptions of the risks associated with investment in these asset classes are provided below . EQUITIES 60%/40 % portfolio : 60% S&P 500 Index and 40% Bloomberg Barclays U.S. Aggregate Bond Index Income without Private 3% Bloomberg Barclays Aggregate 11% Bloomberg Barclays U.S. Moderate Growth and – Capital : 3 Month Index, U.S. Treasury Bill 1 Aggregate Corporate High Index, 3% JPM GBI Yield Bond year) Bond Index, 6% Bloomberg Barclays U.S. 6% Bloomberg Barclays U.S. (10+ year) Bond Index, (5 7 – FIXED INCOME Mid Global Ex -U.S. TR USD Index, 5% JPM EMBI Global TR USD Index, 20% S&P 500 Index, 8% Russell Cap TR USD Index, 6% Russell 2000 Index, 5% MSCI EAFE GR USD Index, 5% MSCI EM GR USD, 5% FTSE EPRA/NAREIT Developed TR USD Index, 2% Bloomberg Commodities Index, 3% HFRI Relative Value Index, 6% HFRI Macro Index, 4% HFRI Event Driven Index, 2% HFRI Equity Hedge Index. REAL rg Barclays U.S. Aggregate Bond Index is composed of the Bloomberg Barclays U.S. Government/Credit Index Investment Grade Fixed Income: Bloombe  ASSETS and the Bloomberg Barclays U.S. Mortgage -Backed Securities Index and includes Treasury issues, agency issues, corporate bond issues, and mortgage - backed securities.  High Yield Fixed Income: Bloomb e -rate, -investment , fixed non rg Barclays U.S. Corporate High Yield Bond Index covers the U.S.- dollar- denominated, -grade ALTERNATIVE INVESTMENTS taxable corporate bond market. Securities are classified as if the middle rating of Moody’s, Fitch, and S&P is Ba1/BB+/BB= or below. Included high yield issues must have at least one year until final maturity. (1 is representative of money markets. Index omberg Barclays U.S. Treasury Bill 3 Month) –  bills: Blo Cash Alternatives/Treasury CURRENCIES  Commodities: Bloomb e rg Commodity Index is a broadly diversified index of commodity futures on 20 physical commodities, subdivided into energy, U.S. agriculture, livestock, precious metals, and industrial metals sectors. Commodity weights are derived in a manner that attemp ts to fairly represent the importance of a diversified group of commodities to the world economy. Public Real Estate:  real estate FTSE EPRA/NAREIT Developed Index is designed to track the performance of listed companies and REITs in developed ASSET ALLOCATION tries worldwide. cou n Hedge Funds: HFRI Fund Weighted Index is a fund -weighted (equal -weighted) index designed to measure the total returns (net of fees) of the  oximately 2,000 hedge funds that comprise the index . Constituent funds must have either $50 million under management or a track record of greater appr DISCLOSURES than 12 months. Substrategies include: HFRI Event Driven , Distressed/Restructuring Index, and HFRI Event Driven (Total) Index. index,  Developed Market Ex -U.S. Fixed Income: JP Morgan Global Ex U.S. Index (JPM GBI Global Ex -U.S. ) is a total return, market -capitalization -weighted Kingdom, Denmark, the United alanced monthly, consisting of the following countries: Australia, Germany, Spain, Belgium, Italy, Sweden, Canada, Japan, reb the Netherlands, and France. Emerging Market Fixed Income: JPM EMBI Global Index is a U.S.- dollar- denominated, investible, market -cap -weighted index representing a broad universe  merging market sovereign and quasi -sovereign debt. While products in the asset class have become more diverse, focusing on both local currency and of e ough the asset class is corporate issuance, there is currently no widely accepted aggregate index reflecting the broader opportunity set available, alth evolving. By using the same index provider as the one used in the developed market bonds asset class, there is consistent categorization of countries among developed international bonds (ex. U.S.) and emerging market bonds .  Developed Market Ex -U.S. Equities: MSCI EAFE Index (Europe, Australasia, Far East) Index (MSCI EAFE GR) is a free- float -adjusted market -capitalization - ghted index designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. wei index designed to measure  Emerging Market Equities: MSCI Emerging Markets Index (MSCI EM GR) is a free-float -adjusted market -capitalization -weighted ity market performance of emerging markets. equ 99 99

100 Index definitions (continued) U.S. Small Cap Equities: Russell 2000® Index  measures the performance of the 2,000 smallest companies in the Russell 3000® Index, which represents oximately 8% of the total market capitalization of the Russell 3000 Index. appr s the performance of the 800 smallest companies in the Russell 1000® Index, which represent  U.S. Mid Cap Equities: Russell Midcap® Index measure ECONOMY approximately 25% of the total market capitalization of the Russell 1000 Index.  consists of 500 stocks chosen for market size, liquidity, and industry group representation. It is a market - -value U.S. Large Cap Equities: S&P 500 Index ighted index with each stock’s weight in the index proportionate to its market value. we  Inflation- CPI: IA SBBI U.S. Inflation Index is a custom unmanaged index designed to track the U.S. inflation rate EQUITIES p  HFRI Relative Value Index maintains positions in which the investment thesis is predicated on realization of a valuation discrepancy in the relationshi ses, and security types ween multiple securities. Managers employ a variety of fundamental and quantitative techniques to establish investment the bet range broadly across equity, fixed income, derivative, other security types. and FIXED INCOME HFRI Equity Hedge Index sses oce maintains positions both long and short in primarily equity and equity derivative securities. A wide variety of investment pr  e employed to arrive at an investment decision, including both quantitative and fundamental techniques; strategies can b e broadly diversified or can b narrowly focused on specific sectors and can range broadly in terms of levels of net exposure, leverage employed, holding per iod , concentrations of market REAL capitalizations, and valuation ranges of typical portfolios. ASSETS HFRI Macro Index is composed of a broad range of strategies in which the investment process is predicated on movements in underlying economic  les and the impact these have on equity, fixed income, hard currency, and commodity markets. Managers employ a variety of techniques, both variab discretionary and systematic analysis, combinations of top- down and bottom- - - and short up theses, quantitative and fundamental approaches, and long ALTERNATIVE term holding periods. Although some strategies employ RV techniques, macro strategies are distinct from RV strategies in that the primary investment INVESTMENTS thesis is predicated on predicted or future movements in the underlying instruments rather than realization of a valuation di scr epancy between securities. maintains positions in companies currently or prospectively involved in corporate transactions of a wide but not  HFRI Event Driven Index variety, including CURRENCIES ited to mergers, restructurings, financial distress, tender offers, shareholder buybacks, debt exchanges, security issuance, and other capital structure lim adjustments. Security types can range from most senior in the capital structure to most junior or subordinated and frequently in volve additional derivative -specific company securities. Event driven exposure includes a combination of sensitivities to equity markets, credit markets, and idiosyncrati c, developments. Investment theses are typically predicated on fundamental characteristics (as opposed to quantitative ) with the realization of the thesis ASSET predicated on a specific development exogenous to the existing capital structure . ALLOCATION While the HFRI Indices are frequently used, they have limitations (some of which are typical of other widely used indices). Thes e limitations include survivorship er performing funds to leave the bias (the returns of the indices may not be representative of all the hedge funds in the universe because of the tendency of low DISCLOSURES index); heterogeneity (not all hedge funds are alike or comparable to one another, and the index may not accurately reflect t he performance of a described style); and limited data (many hedge funds do not report to indices, and, therefore, the index may omit funds, the inclusion of which might significantly affect - reported by hedge fund managers that decide on their ow n, at any time, whether or the performance shown. The HFRI Indices are based on information self not they want to provide, or continue to provide, information to HFR Asset Management, L.L.C. Results for funds that go out of business are included in the index until the date that they cease operations. Therefore, these indices may not be complete or accurate representations of the hedge fund universe, and may be biased in several ways. Returns of the underlying hedge funds are net of fees and are denominated in USD . NOTE: The 4 asset group without private capital Moderate Growth and Income Portfolio represents a balanced portfolio. A idu al balanced portfolio composed of a variety of asset classes typically does not exhibit the same level of volatility as an indiv asset class. This helps to smooth out portfolio performance over time. 100 100

101 Risk considerations . Asset allocation and diversification are investment methods used to help manage risk. They do not ensure a profit or protect aga inst a loss All investing involves risks, including the possible loss of principal. There can be no assurance that any investment strategy will be successful. ECONOMY fluctuate with changes in market and economic conditions and in different environments due to numerous some of factors, Investments Each asset class has its own risk and return characteristics. Some of the risks associated with the representative which may be unpredictable. index asset classes shown in the charts include: EQUITIES are Alternative investments: Alternative investments, including hedge funds and private capital funds , speculative and entail significant risks, FIXED INCOME complex including those associated with potential lack of diversification, restrictions on transferring interests, no available secondary marke t, tax structures, delays in tax reporting, valuation of securities, trade in diverse complex strategies that are affected in different They and pricing. ways and at different times by changing market conditions. Strategies may, at times, be out of market favor for considerable per iods with REAL adverse consequences for the fund and the investor. An investment in these funds involves the risks inherent in an investment in securities and ASSETS can include losses associated with speculative investment practices, including hedging and leveraging through derivatives, su ch as futures, U.S. securities, junk bonds, options, swaps, short selling, investments in non - and illiquid investments. ALTERNATIVE INVESTMENTS Commodities : The commodities markets are considered speculative, carry substantial risks, and have experienced periods of extreme volatility. may be affected by changes in overall market movements, commodity index volatility, changes in interest Commodities rates, or other factors CURRENCIES Investing in physical commodities, such as affecting a particular industry or commodity. a portfolio to gold and other precious metals, exposes considerations, such as potentially severe price fluctuations over short periods of time and storage costs that exceed the custodial other risk lly, investing in and/or brokerage costs associated with a portfolio’s other holdings. In addition to the risks of investing in commodities gen era . base metals carries additional risks. These metals are highly levered to the relative strength of the U.S. dollar, economic growth, and inflation ASSET ALLOCATION They cannot be held physically and are not easily converted to cash. Exposure to base metals is usually accessed through investments in stocks of mining companies, exchange - traded funds, mutual funds, or futures trading . DISCLOSURES Currencies: Currency risk is the risk that foreign currencies will decline in value relative to that of the U.S. dollar. Exchange rate movement to decline . between the U.S. dollar and foreign currencies may cause the value of an investment 101 101

102 Risk considerations (continued) Stocks Equity securities: are subject to market risk, which means their value may fluctuate in response to general economic and market are generally more volatile company stocks conditions, the prospects of individual companies, and industry sectors. The prices of small/mid- ECONOMY midsize and than large -company stocks. They often involve higher risks because smaller companies may lack the management expertise, diversification, and competitive strengths to endure adverse economic conditions. financial resources, product EQUITIES Investments income : -income securities are subject to in fixed Fixed interest rate, credit/default, liquidity, inflation, and other risks. Bond prices risk is Credit ctuate inversely to changes in interest rates. Therefore, a general rise in interest rates can result in a decline in the bond’s price. flu FIXED bonds. If sold prior to maturity, lower-rated risk is heightened in the risk that an issuer will default on payments of interest and/or principal. This INCOME -income All fixed securities are subject to market risk. -income investments may be worth less than their original cost upon redemption or fixed maturity. High -yield fixed -income securities are considered speculative, involve greater risk of default, and tend to be more volatile than -grade fixed offer interest payments exempt from federal taxes, and potentially state and local -income securities. investment bonds Municipal REAL ASSETS income taxes. Municipal bonds are subject to credit risk and potentially the alternative minimum tax (AMT). Quality varies widely depending on are backed by the full faith and credit of the federal government as to payment of principal and the specific issuer. U.S. government securities free from credit risk, they are subject to interest rate risk interest if held to maturity. Although . ALTERNATIVE INVESTMENTS Investing in foreign securities presents certain risks not associated with domestic investments, such as Foreign/emerging/frontier markets : ncy fluctuation, political and economic instability, and different accounting standards. This may result in greater shar e p rice volatility. curr e CURRENCIES and frontier markets These risks are heightened in emerging . special risks, including possible illiquidity of the underlying properties, credit Real estate : Investing in real estate investment trusts (REITs) has ASSET k, interest rate fluctuations, and the impact of varied economic conditions. ris ALLOCATION may cause the Treasury Inflation- Protected Securities (TIPS): TIPS are subject to interest rate risk, especially when real interest rates rise. This DISCLOSURES securities. -income fixed ying value of the bond to fluctuate more than other underl 102 102

103 Portfolio compositions -asset -group portfolios without private capital Four – : 3% U.S. Treasury Bill 1 3 year), 25 3 Month Index, 14% Bloomberg Barclays U.S. Aggregate ( 1 – Moderate Income % Bloomberg Barclays U.S. Aggregate ( 5 – 7 year), ECONOMY Index, 6% JPM GBI Global 7% Bloomberg U.S. Aggregate (10 + year), 7% Bloomberg Barclays U.S. Corporate High Yield Bond Barclays Ex -U.S. TR USD Index, 5% JPM EMBI Global TR USD Index, 10% S&P 500 Index, 2% Russell Mid Cap TR USD Index, 4% MSCI EAFE GR USD Index, 5% FTSE EPRA/NAREIT Devel ope d TR USD Index, 4% HFRI Relative Value Arbitrage Index, 5% HFRI Macro Index, 3% HFRI Event Driven Index. U.S. 7 year) Bond Index, 6% 5 Aggregate ( U.S. 3 Month Index, 11% Bloomberg Barclays – Moderate Growth and Income: 3% Bloomberg Barclays – Treasury Bill 1 EQUITIES U.S. omberg Barclays U.S. Aggregate (10+ year) Bond Index, 6% Bloomberg Barclays -U.S. Corporate High Yield Bond Index, 3% JPM GBI Global Ex TR USD Index, 5% Blo Russell JPM EMBI Global TR USD Index, 20% S&P 500 Index, 8% Mid Cap TR USD Index, 6% Russell 2000 Index, 5% MSCI EAFE GR USD Index, 5% MSCI EM GR USD, 5% o I ndex, 4% HFRI Event Driven FTSE EPRA/NAREIT Developed TR USD Index, 2% Bloomberg Commodities Index, 3% HFRI Relative Value Arbitrage Index, 6% HFRI Macr FIXED INCOME Index, 2% HFRI Equity Hedge Index. Aggregate Moderate Growth: 2% Bloomberg Barclays U.S. Treasury Bill 1 – 3 Month Index, 2% Bloomberg Barclays U.S. (10 year), U.S. 3% Bloomberg Barclays Cap TR USD Index, 12% Russell 2000 Index, 11% MSCI EAFE porate High Yield Bond Index, 3% JPM EMBI Global TR USD Index, 25% S&P 500 Index, 13% Russell Mid Cor REAL ASSETS GR USD Index, 10% MSCI EM GR USD, 5% FTSE EPRA/NAREIT Developed TR USD Index, 2% Bloomberg Commodities Index, 2% HFRI Relative Value Arbitrage Index, 6% HFRI Macro Index, 2% HFRI Event Driven Index, 2% HFRI Equity Hedge Index . -asset -group portfolios Three ALTERNATIVE INVESTMENTS Aggregate Moderate Income: 3% U.S. Treasury Bill 1 – 3 Month Index, 19% Bloomberg Barclays U.S. Aggregate ( 1 – 3 year) Bond Index, 30% Bloomberg Barclays U.S. U.S. 5% Bond Index, Corporate High Yield JPM GBI Global (5 – 7 year) Bond Index, 7% Bloomberg Barclays U.S. Aggregate (10+ year) Bond Index, 6% Bloomberg Barclays Russell 2000 TR USD Index, 5% JPM EMBI Global TR USD Index, 12% S&P 500 Index, 2% Russell Mid Cap TR USD Index, 2% -U.S. Index, 4% MSCI EAFE GR USD Index, 5% Ex CURRENCIES FTSE EPRA/NAREIT Developed TR USD Index. 3% Bloomberg Barclays Income: 3 Month Index, 4 U.S. Treasury Bill 1 – Moderate Growth and % Bloomberg Barclays U.S. Aggregate ( 1 – 3 year), 16 % Bloomberg Aggregate (10 % JPM GBI Global lays U.S. Aggregate ( 5 – 7 year), 7 % Bloomberg Barclays U.S. Yield Bond Index, 3 + year), 6 % Bloomberg Barclays U.S. Corporate High Barc ASSET , 9 Ex -U.S. TR USD Index, 5 % JPM EMBI Global TR USD Index, 21 % S&P 500 Index % Russell Mid Cap TR USD Index, 8% Russell 2000 Index, 6% MSCI EAFE GR USD Index, 5 % ALLOCATION MSCI EM GR USD, 5 % FTSE EPRA/NAREIT Developed TR USD Index, 2 % Bloomberg Commodities Index. 3 year), 3% Moderate Growth: 2% Bloomberg Barclays U.S. Treasury Bill 1 – 3 Month Index, 2% Bloomberg Barclays U.S. Aggregate ( 1 – U.S. Bloomberg Barclays DISCLOSURES Corporate High TR 7 year), 3% Bloomberg Barclays U.S. Aggregate (10 + year), 3% Bloomberg Barclays U.S. – Yield Bond Index, 2% JPM GBI Global Ex- U.S. 5 regate ( Agg Russell 2000 Index, JPM EMBI Global TR USD 29% S&P 500 Index, 13% Russell Mid Cap TR USD Index, 13% Index, 10% MSCI EAFE GR USD Index, 10% MSCI USD Index, 3% Index. EM GR USD, 5% FTSE EPRA/NAREIT Developed TR USD Index, 2% Bloomberg Commodities Composition for hypothetical portfolios, slide 90: Hypothetical top -performer portfolio: 3Y); 2003: 100% Bloomberg Commodity Index; 2004: 2002: 100% Bloomberg Barclays U.S. Aggregate Bond Index (1– 100% FTSE EPRA/NAREIT 100% MSCI Emerging Markets Index; 2005: 100% FTSE EPRA/NAREIT Developed Index; 2006: 100% MSCI Emerging Markets Index; 2007: Developed Index; 2008: 100% MSCI Emerging Markets Index; 2009: 100% J.P. Morgan GBI Global ex -U.S. Index; 2010: 100% MSCI Emergi ng Markets Index; 2011: 100% Russell 2000 Index; 2012: 100% Bloomberg Barclays U.S. Aggregate Bond Index (10+Y); 2013: 100% FTSE EPRA/NAREIT Developed Ind ex; 2014: 100% Russell 2000 Index; 2015: 100% Bloomberg Barclays U.S. Aggregate Bond Index (10+Y); 2016: 100% S&P 500 Index; 2017: 100% Russell 2000 Index; and 2018 100% MSCI Emerging Markets Index. Hypothetical bottom-performer portfolio: : 100% MSCI EAFE Index; 2003: 100% S&P 500 Index; 2004: 100% Bloomberg Barclays 1– 3 Month U.S. 2002 U.S. Index; 2007: 100% Bloomberg asury Bill Index; 2005: 100% U.S. Treasury T- Bill Constant Maturity Rate 3 -Month Index; 2006: 100% J.P. Morgan GBI Global ex- Tre Commodity Index; 2008: 100% FTSE EPRA/NAREIT Developed Index; 2009: 100% MSCI Emerging Markets Index; 2010: 100% Bloomberg Barcl ays U.S. Aggregate Bond Index (10+Y); 2011: 100% Bloomberg Barclays 1– 3 Month U.S. Treasury Bill Index; 2012: 100% MSCI Emerging Markets Index; 2013: 10 0% Bloomberg Commodity Index; –3 2014: 100% Bloomberg Commodity Index; 2015: 100% Bloomberg Commodity Index; 2016: 100% Bloomberg Commodity Index; 2017: 100% Blo omberg Barclays 1 103 103 Month U.S. Treasury Bill Index; and 2018: 100% Bloomberg Barclays 1 –3 Month U.S. Treasury Bill Index.

104 Index definitions Cash alternatives/Treasury bills: 1 . is representative of money markets Index Bloomberg Barclays U.S. Treasury Bills ( 3 Month) – ECONOMY IA SBBI U.S. 30-Day Treasury Bill Index is a custom index designed to measure the performance of U.S. Treasury bills maturing in 0 to 30 days. Fixed income: EQUITIES Baa2, Bloomberg Barclays Corporate Bond BAA Index is a subset of the Bloomberg Barclays U.S. Corporates Index with an index rating of Baa1, or Baa3 . FIXED -based measure of the global fixed Bloomberg Barclays Multiverse Index provides a broad -income bond market. The index represents the union INCOME the Global Aggregate Index and the Global High- and high- securities in all eligible currencies. Yield Index and captures investment -grade yield of Stand-alone Rate ABS Index and the Chinese Aggregate Index are excluded. The Multiverse Index family indices such as the Euro Floating- includes a wide range of standard and customized subindices by sector, quality, maturity, and country. REAL ASSETS Short-term fixed income taxable: U.S. Aggregate Bloomberg Barclays erg Barclays U.S. Government/Credit 1 – 3 Year Bond Index is unmanaged and is composed of the Bloomb ALTERNATIVE Index and the and includes Treasury issues, agency issues, corporate bond issues, Bloomberg Barclays U.S. Mortgage-Backed Securities Index INVESTMENTS -backed securities with maturities of one to three years. and mortgage Intermediate- term fixed income taxable : CURRENCIES is unmanaged and is composed of the erg Barclays U.S. Government/Credit Bloomberg Barclays 7 Year Bond Index U.S. Aggregate 5 – Bloomb Bloomberg Barclays U.S. Mortgage-Backed Securities Index and includes Treasury issues, agency issues, corporate bond issues, Index and the and mortgage -backed securities with maturities of five to seven years. ASSET ALLOCATION Long- term fixed income taxable: Bloomberg Barclays U.S. Aggregate 10+ Year Bond Index is unmanaged and is composed of the Bloomberg Barclays U.S. Government/Credit DISCLOSURES and includes Treasury issues, agency issues, corporate bond issues, Bloomberg Barclays U.S. Mortgage-Backed Securities Index and the Index and mortgage -backed securities with maturities of 10 years or longer. Investment-grade fixed income taxable : Bloomberg erg Barclays U.S. Aggregate Bond Index is composed of the Bloomberg Barclays U.S. Government/Credit Index and the Bloomb U.S. Mortgage-Backed Securities Index and includes Treasury issues, agency issues, corporate bond issues, and mortgage -backed Barclays securities. U.S. municipal bond: a erg Barclays U.S. Municipal Index is considered representative of the broad market for investment -grade , tax -exempt bonds with Bloomb maturity of at least one year. High -yield fixed income taxable: , fixed erg Barclays U.S. Corporate High Yield -rate, taxable covers the U.S.-dollar -denominated , non- investment -grade Bond Index Bloomb high yield if the middle rating of Moody’s, Fitch, and S&P is Ba1/BB+/BB= or below. Included corporate bond market. Securities are classified as issues must have at least one year until final maturity. 104 104

105 (continued) Index definitions High -yield municipal fixed income: -grade measures the non- investment nonrated U.S.- and Bloomberg Barclays U.S. Municipal High Yield Index dollar -denominated , fixed -rate, ECONOMY mpt bond market within the 50 United States and four other qualifying regions (Washington, D.C.; Puerto Rico; Guam; and the Virgin tax- exe historically, the index has been however, prerefunded bonds; Islands). The index allows state and local general obligation, revenue, insured, and -alone index with no crossover into other Bloomberg Barclays comprised of mostly revenue bonds. The U.S. Municipal High Yield Index is a stand EQUITIES U.S. taxable indices, such as the High Yield Index. Investment-grade corporate fixed income: FIXED Barclays U.S. Investment Grade Bond Index corporate bond market. measures the performance of the erg -grade investment Bloomb INCOME Government bonds : is a custom unmanaged index designed to measure the performance of long- IA SBBI U.S. Long -Term Government Bond Index term U.S. REAL ASSETS ernment bonds, which includes U.S. Treasury and U.S. government agency bonds with maturities of seven years or longer. gov Bloomberg denominated .- dollar- -grade, U.S - and -rate, taxable corporate Barclays , fixed U.S. Government/Credit Index includes investment ALTERNATIVE ernment -related bonds . gov INVESTMENTS Bloomberg Barclays U.S. Treasury 10+ Year Bond Index includes public obligations of the U.S. Treasury with a remaining maturity of 10 years or e. mor CURRENCIES Emerging market fixed income : -denominated J.P. Morgan EMBI Global Index (USD) is a U.S.-dollar index representing a broad universe of , investible, market -cap- weighted ASSET ing market sovereign and quasi -sovereign debt. While products in the asset class have become more diverse, focusing on both local emerg ALLOCATION currency and corporate issuance, there is currently no widely accepted aggregate index reflecting the broader opportunity set av ailable, although the asset class is evolving. By using the same index provider as the one used in the developed market bonds asset class, there is consistent categorization of countries among developed international bonds ( ex -U.S .) and emerging market bonds. DISCLOSURES J.P. Morgan Emerging Markets Global Index local currency ) is a comprehensive global local emerging market index and consists of regularly ( ded, liquid fixed- rate, domestic currency government bonds. tra Developed market fixed income: J.P. Morgan GBI Global ex- U.S. Index (Unhedged) in USD is an unmanaged index market representative of the total return performance in U.S. ars on an unhedged basis of major non -U.S. bond markets. doll J.P . Morgan Non -U.S. Global Government Bond Index (Hedged) is an unmanaged market index representative of the total return performance, -U.S. bond markets. It is calculated in U.S. dollars. hedged basis, of major non on a 105 105

106 Index definitions (continued) Equities: ECONOMY Global equities : adjusted market-capitalization- weighted to measure the equity market performance of index that is designed - float is a free- Index MSCI World . developed markets EQUITIES free-float- MSCI All Country World Index (ACWI) is a adjusted market-capitalization- weighted index that is designed to measure the equity market performance of 23 developed and 23 emerging markets. FIXED equities: U.S. INCOME reflect the investment —which MSCI U.S. Equity Indices are a domestic -only series— independent from MSCI’s Global Equity Index family -capitalization size, by value and growth investment equity markets by U.S. tunities in the and by sectors and industries. market styles, oppor REAL ASSETS Small-cap equities: Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000® Index, which represents approximately ALTERNATIVE of the total market capitalization of the Russell 3000 Index. 8% INVESTMENTS Mid- cap equities: CURRENCIES Russell approximately represents Midcap® Index measures the performance of the 800 smallest companies in the Russell 1000® Index, which of the total market capitalization of the Russell 1000® Index. 25% ASSET equities: Large- cap ALLOCATION S&P 500 Index consists of 500 stocks chosen for market size, liquidity, and industry group representation. It is a market -value -weighted index each stock’s weight in the index proportionate to its market value. with DISCLOSURES Russell measures the performance of the 1,000 largest companies in the Russell 3000 Index, which represents approximately 92% 1000® Index total market capitalization of the Russell 3000 Index. of the Emerging market equities : (MSCI EM GR) is a free-float- adjusted market -capitalization- weighted index designed to measure equity market MSCI Emerging Markets Index ormance of emerging markets. perf Frontier m : arket equities MSCI Frontier Markets Index (MSCI FM GR) is a free-float- adjusted market-capitalization- weighted index designed to measure equity market ormance of the world's least developed capital markets. perf Small- company stocks: capitalization U.S. stocks. is a custom index designed to measure the performance of small- IA SBBI U.S. Small Stock Index 106 106

107 (continued) Index definitions Developed market ex- U.S. equities: is a free-float- MSCI EAFE Index adjusted market-capitalization- weighted index designed to measure the equity market performance of ECONOMY loped markets, excluding the U.S. and Canada. deve With 444 constituents, the MSCI Europe Index captures large - and mid -cap representation across 15 developed market countries in Europe. EQUITIES developed market covers approximately 85% of the equity universe. market capitalization across the European adjusted free-float- index weighted index comprised of Japan’s top 225 blue Nikkei 225 Index is the leading and most -respected index of Japanese stocks. It is a price- -chip nies on the Tokyo Stock Exchange. The Nikkei is equivalent to the Dow Jones Industrial Average Index in the U.S. compa FIXED INCOME EURO STOXX 50 Index is Europe's leading blue -chip index for the eurozone and provides a blue -chip representation of supersector leaders in countries: Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, eurozone . The index covers 50 stocks from 12 urozone e the REAL Portugal, and Spain. Luxembourg, the Netherlands, ASSETS is a weighted -capitalization- market index of 40 of the largest companies that trade on the Hong Kong Exchange. Hong Kong Hang Seng Index Hang Seng Index is maintained by a subsidiary of Hang Seng Bank and has been published since 1969. The index aims to capture the The ALTERNATIVE INVESTMENTS leadership of the Hong Kong exchange and covers approximately 65% of its total market capitalization. The Hang Seng members are also classified into one of four subindices based on the main lines of business, including commerce and industry, finance, utilities, and properties . CURRENCIES Volatility indices: VNKY Index: The Nikkei Stock Average Volatility Index is calculated by using prices of Nikkei 225 futures and Nikkei 225 options on the O a sak (KAKUHOU) is 15:20 rities Exchange. The real -time (every 15 seconds) calculation started from January 30, 2012. Final confirmation value Secu ASSET JPT. ALLOCATION VSTOXX Index is based on a new methodology jointly developed by Deutsche Borse and Goldman Sachs to measure volatility in the eurozone . day is based on the EURO STOXX 50 Index options traded on Eurex. It measures implied volatility on options with a rolling 30- expiry. VSTOXX DISCLOSURES HSI Volatility Index aims to measure the -day expected volatility of the Hang Seng Index implicit in the prices of near -term and next - calendar 30- Options, which are now trading on the Hong Kong Exchanges and Clearing Limited's derivatives market. m Hang Seng Index ter The Chicago Board Options Exchange Volatility Index reflects a market estimate of future volatility, based on the weighted av era ge of the VIX: ed volatilities for a wide range of strikes. First - and second-month expirations are used until eight days from expiration, then the second impli and third are used . Currencies: U.S. Dollar Index (USDX/DXY) measures the value of the U.S. dollar relative to majority of its most significant trading partners. This index is similar to other trade- weighted indices, which also use the exchange rates from the same major currencies . tracks the performance of emerging market currencies relative to the U.S. dollar. J.P . Morgan Emerging Market Currency Index 107 107

108 Index definitions (continued) Commodities: ECONOMY Bloomberg Commodity Index is calculated on an excess return basis and reflects commodity futures price movements. The index rebalances and and weight by world production, -caps are applied at the commodity, sector, annually, weighted two -thirds by trading volume and one- third . group level for diversification EQUITIES -weighted geometric average of commodity price levels relative to the -year average base The Reuters Continuous Commodity Index is an equal ce. pri FIXED INCOME is a commodity group subindex sector : Bloomberg Energy Subindex Energy of the Bloomberg Commodity Index. It is composed of futures and natural gas. It reflects the return of underlying commodity futures price movements acts on crude oil, heating oil, unleaded gasoline, contr REAL only and is quoted in USD. ASSETS sector of the Bloomberg Commodity Index. It is composed of subindex is a commodity group : Bloomberg Agriculture Subindex Agriculture and wheat. It reflects the return of underlying commodity es contracts on coffee, corn, cotton, soybeans, soybean oil, soybean meal, sugar, futur ALTERNATIVE INVESTMENTS futures price movements only and is quoted in USD. : Bloomberg Precious Metals Precious metals sector Subindex is a commodity group subindex of the Bloomberg Commodity Index. It is CURRENCIES sed of futures contracts on gold and silver. It reflects the return of underlying commodity futures price movements only d is quoted in an compo USD. Subindex Base metals sector : Bloomberg Industrial Metals is composed of futures contracts on aluminum, copper, nickel, and zinc. It reflects ASSET return of underlying commodity futures price movements only and is quoted in USD. the ALLOCATION REITs: DISCLOSURES Global REITs/public real estate: FTSE EPRA/NAREIT Developed Index is designed to track the performance of listed real estate companies and REITs in developed countries worldwide. Domestic REITs: FTSE NAREIT All Equity REITs Index is designed to track the performance of REITs representing equity interests in (as opposed tgages on) properties. It represents all tax-qualified REITs with more than 50% of total assets in qualifying real estate assets, other than to mor mortgages secured by real property that also meet minimum size and liquidity criteria. International REITs: FTSE EPRA/NAREIT Global Ex -U.S. Index is part of a range of indices designed to help U.S. investors benchmark their rnational investments. The index comprises large -, mid -, and small -cap stocks globally excluding the U.S . The index is derived from the FTSE inte Series, which covers 98% of the world’s investible market capitalization. Global Equity Index 108 108

109 Index definitions (continued) Hedge funds: ECONOMY HFRI Fund Weighted Composite Index -weighted) index designed to measure the total returns (net of fees) of the is a fund -weighted (equal track record approximately 2,000 hedge funds that comprise the Index. Constituent funds must have either $50 million under management or a Substrategies include HFRI Event of greater than 12 months. -Driven (Total) Index. -Driven, Distressed/Restructuring Index, and HFRI Event EQUITIES HFRI Event Driven Index maintains positions in companies currently or prospectively involved in corporate transactions of a wide variety, , s ecurity issuance, ng but not limited to mergers, restructurings, financial distress, tender offers, shareholder buybacks, debt exchanges includi and other capital structure adjustments. Security types can range from most senior in the capital structure to most junior or subordinated and FIXED INCOME frequently involve additional derivative securities. Event driven exposure includes a combination of sensitivities to equity markets; credit company- and idiosyncratic, developments. Investment theses are typically predicated on fundamental characteristics (as markets; specific opposed to quantitative), with the realization of the thesis predicated on a specific development exogenous to the existing c api tal structure. REAL ASSETS HFRI Relative Value Index maintains positions in which the investment thesis is predicated on realization of a valuation discrepancy in the ationship between multiple securities. Managers employ a variety of fundamental and quantitative techniques to establish i nve stment rel ALTERNATIVE . theses, and security types range broadly across equity, fixed income, derivative, or other security types INVESTMENTS managers that consists of investment HFRI Macro Index trade a broad range of strategies in which the investment process is predicated on and commodity markets. ements in underlying economic variables and the impact these have on equity, fixed -income , hard currency, mov CURRENCIES Managers employ a variety of techniques, both discretionary and systematic analysis, combinations of top- down and bottom- up theses, - and quantitative and fundamental approaches, and long holding periods. Although some strategies employ RV techniques, macro short -term strategies are distinct from RV strategies in that the primary investment thesis is predicated on predicted or future movemen ts in the ASSET and equity underlying instruments rather than realization of a valuation discrepancy between securities. In a similar way, while both macro ALLOCATION hedge managers may hold equity securities, the overriding investment thesis is predicated on the impact that movements in underlying macroeconomic variables may have on security prices, as opposed to equity hedge, in which the fundamental characteristics on the company DISCLOSURES are the most significant are integral to the investment thesis. HFRI Equity Hedge (Total) Index consists of investment managers that maintain positions both long and short in primarily equity and equity vative securities. A wide variety of investment processes can be employed to arrive at an investment decision, including both quantitative der i and fundamental techniques; strategies can be broadly diversified or narrowly focused on specific sectors and can range broadly in terms of levels of net exposure, leverage employed, holding period, concentrations of market capitalizations, and valuation ranges of typical portfolios. Equity hedge managers would typically maintain at least 50 % (and may in some cases be substantially entirely invested) in equities, both long and short . 109 109

110 Index definitions (continued) Private capital: ECONOMY Private equity: - The Cambridge Associates LLC U.S. Private Equity Index® uses a horizon Private equity: Cambridge Associates LLC U.S. Private Equity Index® subordinated -quality buyout, growth equity, private equity energy, and ation based on data compiled from more than 1,400 institutional calcul EQUITIES capital funds formed between 1986 and 2017. The funds included in the index report their performance voluntarily and therefor he index may e t Funds reflect a bias towards funds with records of success. report unaudited quarterly data to Cambridge and Associates when calculating the unds included in index. The index is not transparent and cannot be independently verified because Cambridge Associates does not identify the f FIXED INCOME the index. Because Cambridge recalculates the index each time a new fund is added, the historical performance of the index is not Associates fixed, can’t be replicated and will differ over time from the day presented. The returns shown are net of fees, expenses and car ried interest. Index returns do not represent fund performance. REAL ASSETS Private debt : is a horizon calculation Index Private credit: ILPA (Institutional Limited Partners Association) Private Markets Benchmark - Private Credit Fund ALTERNATIVE INVESTMENTS compiled from 269 private credit funds (credit opportunities and subordinated capital funds), including fully liquidated d on data e bas interest. partnerships, formed between 1986 and 2017. funds in the index The The pooled horizon return is net of fees, expenses, and carried rivate markets are exclusively those that ILPA members have invested in; the goal of the ILPA private markets benchmark effort is to create a p CURRENCIES benchmark that represents the investible universe and fund performance for global, institutional investors. The benchmark is issued on a quarterly basis, approximately 140 calendar days after quarter end. All data included in the ILPA Benchmark is derived from the quarterly and annual audited financial statements that general partners produce for their limited partners. Performance statistics include rates of return (net ASSET IRR & expressed - public market equivalents) and investment multiples (DPI, RVPI and TVPI ). These statistics are in terms of time period (since ALLOCATION geography inception, year -to- date, etc.), quartile ranking, vintage year, . As the benchmark same size expands, the number of and strategy . statistics, composites and types of analysis is expected to increase. Index returns do not represent fund performance DISCLOSURES Private real assets: is a quarterly time series composite total rate of return measure of investment performance of a Private real estate: NCREIF Property Index large pool of individual commercial real estate properties acquired in the private market for investment purposes only. ver y Farmland: NCREIF Farmland Index is a quarterly time series composite return measure of investment performance of a large pool of individual mland properties acquired in the private market for investment purposes only. far is a quarterly time series composite return measure of investment performance of a large pool of Timberland: NCREIF Timberland Index idual timber properties acquired in the private market for investment purposes only. indiv 110 110

111 Index definitions (continued) indices: Economic ECONOMY Institute for Supply Management (ISM) Manufacturing Index® is a composite index based on the diffusion indices of five of the indices with new orders (seasonally adjusted), employment (seasonally adjusted), production supplier deliveries (seasonally adjusted), equal weights: (seasonally adjusted), and inventories . An index value over 50 indicate expansion; below 50 indicates contraction. The values for the index can be between 0 and 100. EQUITIES -Manufacturing Index Institute for Supply Management (ISM) Non is based on surveys of more than 400 non- manufacturing firms by the titute for Supply Management. The ISM Non- Manufacturing Index tracks economic data. Ins FIXED INCOME is a measure that examines the weighted average of prices of a basket of consumer goods and services, such as Price Index (CPI) Consumer portation, food, and medical care. It is calculated by taking price changes for each item in the predetermined basket of goods and trans REAL averaging them. ASSETS Producer Price program measures the average change over time in the selling prices received by domestic producers for their Index (PPI) t. outpu ALTERNATIVE INVESTMENTS IA SBBI U.S. Inflation Index is a custom unmanaged index designed to track the U.S. inflation rate. NFIB Small Business Optimism Index from a survey that is conducted each month by the compiled is the small business optimism index CURRENCIES al Federation of Independent Business (NFIB) of its members. The index is a composite of 10 seasonally adjusted components based on Nation questions on the following: plans to increase employment, plans to make capital outlays, plans to increase inventories, expect e conomy to improve, expect real sales higher, current inventory, current job openings, expected credit conditions, now a good time to expand, and earnings ASSET trend. ALLOCATION Consumer Index (CCI) is designed to measure consumer confidence, which is defined as the degree of optimism on the state of the Confidence my that consumers are expressing through their activities of savings and spending. Global consumer confidence is not mea sured. econo DISCLOSURES Housing Marketing Index (HMI): The National Association of Home Builders (NAHB) Housing Market Index (HMI) is a weighted, seasonally traffic. A rating of 50 ted statistic derived from ratings for present single -family sales, single -family sales in the next six months, and buyers adjus indicates that positive responses received from builders is about the same as the number of negative responses; ratings highe r t han 50 indicate more positive responses. American Association of Individual Investors (AAII) U.S. Investor Sentiment survey measures the percentage of individual investors who are sh, bearish, and neutral on the stock market short term. bulli U.S. Dollar Index (USDX/DXY) measures the value of the U.S. dollar relative to majority of its most significant trading partners. This index is which also use the exchange rates from the same major currencies. ilar to other trade- weighted indices, sim low sulfur) crude (WTI ) is a light, sweet (that is, West Texas Intermediate oil and is the main type of U.S. crude oil traded in U.S. futures kets. mar Note: MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSC I data nancial products. This ained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or fi cont 111 111 report is not approved, reviewed, or produced by MSCI.

112 Disclosures (WFII). WFII is a registered investment adviser and wholly Global Investment Strategy (GIS) is a division of Wells Fargo Investment Institute, Inc. owned subsidiary of Wells Fargo Bank, N.A., a bank affiliate of Wells Fargo & Company. ECONOMY al information ner The information in this report was prepared by GIS. Opinions represent GIS’ opinion as of the date of this report; are for ge the markets s only; and are not intended to predict or guarantee the future performance of any individual security, market sector, or purpose EQUITIES generally. GIS does not undertake to advise you of any change in its opinions or the information contained in this report. Wells Fargo & ort. rep Company affiliates may issue reports or have opinions that are inconsistent with, and reach different conclusions from, this FIXED to any particular The information contained herein constitutes general information and is not directed to, designed for, or individually tailor ed INCOME This material is not intended to be a client stor or potential investor. -specific suitability analysis or recommendation; an offer to participate inve in any investment; or a recommendation to buy, hold, or sell securities. Do not use this information as the sole basis for in ves tment decisions. existing Do not select an asset class or investment product based on performance alone. Consider all relevant information, including y our REAL ASSETS portfolio, investment objectives, risk tolerance, liquidity needs, and investment time horizon. Wells Fargo Asset Management (WFAM) is the trade name for certain investment advisory/management firms owned by Wells Fargo & ALTERNATIVE ny. These firms include but are not limited to Wells Capital Management Incorporated and Wells Fargo Funds Management, LLC . Certain Compa INVESTMENTS products managed by WFAM entities are distributed by Wells Fargo Funds Distributor, LLC (a broker -dealer and Member FINRA). a stment advice or ovide inve This material is for general informational and educational purposes only and is NOT intended to pr CURRENCIES 401303 04-1 recommendation of any kind—i ncluding a recomm endation for any specific investment, str ategy, or plan. WFAM 9 ASSET 419-0 © 2019 Wells Fargo Investment Institute. All rights reserved. WCR-0 0055 ALLOCATION DISCLOSURES 112 112

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