Annuali? ■ed Gros; : Targets Dora iside Zone Upsids : Zone   Tin) March 28,2002 SIThr u March 28, 2002                                                 ER TE   RedTE? Yellow TE1 Yellow TE1 RedTE? p (%) B(%) ER (bps) P(%) B (%) ER (bps) (bp=) (bps) IR (bps) (bps) (bps) (bps) 0.38 0.74 (36) (3.82) (4.48) 66 45 90 0.50 63 72 126 162 0.78 0.74 4 (4.41) (4.48) 7               0.08 0.74 (65) (0.57) (3.51) 294               1.62 4.09 (248) 4.79 3.16 163 200 350 0.57 245 280 500 650 (0.21) (2.59) 238 0.79 (13.42) 1,421 450 950 0.47 665 760 1,250 1,500 (4.90) (2.59) (232) (8.22) (13.42) 519 350 750 0.47 525 600 1,050 1,600 (4.27) (2.59) (168) (26.98) (18.60) (838) 400 900 0.44 630 720 1,250 1,600 0.52 0.74 (22) (4.26) (5.11) 85 160 200 0.80 140 160 300 400 0.83 0.27 56 (3.00) (3.64) 64 100 100 1.00 70 80 150 200 (4.46) (1.96) (250) (4.38)   (4.04) (1.96) (208) 2.14 (4.38) 652 415 900 0.40 630 720 1,350 1,600       (1.02) 1.66 (267) 500 1,000 0.50 700 800 1,400 1,700 11.47 9.58 189 23.42 21.25 217               9.40 9.58 (18) 27.48 21.25 623 240 600 0.40 420 480 850 1,050 17.36 9.58 778 21.94 13.39 856 350 1,000 0.35 700 800 1,400 1,650 1.87 1.23 64 (5.69) (8.53) 284 141 283 0.50 198 226 396 509 0.49 0.51 (1) (10.28) (10.65) 37               1.37 0.51 86 (4.85) (8.98) 413               (0.51) 0.51 (102) (7.92) (8.98) 106 325 550 0.59 385 440 750 950 2.78 0.51 227 (9.04) (8.98) (S) 350 700 0.50 475 550 1,000 1,250 2.08 0.51 157 1.60 (8.98) 1,057 250 500 0.50 350 400 700 950   13.00 11.81 119 (6.56) (3.11) (346) 254 508 0.50 356 407 711 915 13.27 11.81 147 (3.72) (6.72) 301 200 500 0.40 350 400 700 800 12.33 11.81 52 (1.19) 8.49 (967) 500 900 0.56 630 720 1,300 1,600 0.22 0.10 13 7.78 7.89 (11) 35 69 0.50 48 55 97 124 (0.02) 0.10 (12) 8.16 7.89 27 100 125 0.80 88 100 165 200 (0.10) 0.10 (20) 8.46 8.39 a so 100 0.80 70 80 150 200 0.36 0.10 26 10.19 9.18 101               1.82 1.53 29 3.03 1.74 130 145 80 1.81 55 65 110 140 palatable than unintended exposures. This brings us back to a point made earlier regarding the correlation between managers' ability to quantify risks in their portfolios and their ability to generate returns in excess of their benchmarks. Managers who don't fully understand the risks in their portfolios will over time find it more difficult to add value after fees for their clients. Setting near-term expectations is also important because it allows for more effective ongoing oversight of the portfolio. Risk managers can monitor the specific decisions and milestones that should ultimately bring the portfolio manager's risk back in line with expectations. For example, suppose that through conversations it is determined that the portfolio manager believes several near-term catalysts in the technology sector will significantly enhance the prices of stocks in the portfolio. Further, suppose the portfolio manager states the intent to reduce exposure to those stocks as the rise occurs, or subsequently, if the sector's news isn't as posi-