3 AT A GLANCE FIRST QUARTER RETURNS Data represents past performance. Past performance is no guarantee of future results. Chart is for illustrative purposes only. Returns are based on data from the S&P 500, Russell Investments for US indices, MSCI for international and Barclays for bonds for the time period of January 1, 2017 through March 31, 2017. Indexes used for the table are as follows: S&P 500TR USD; Russell 1000ValueTR USD; Russell 2000 TR USD; Russell 2000ValueTR USD; MSCI EAFE NR USD; MSCIValue NR USD; MSCI EAFE Small Cap NR USD; MSCI SmallValue NR USD; MSCI EM NR USD; Barclays US Govt/Credit 1-5 YrTR USD; Barclays US Agg BondTR USD. • Equity markets posted strong gains to begin 2017, with international equities outperforming U.S. equities. • Globally, emerging markets have performed the best so far, up 11.45% this year. • In the U.S., large company stocks outperformed small company stocks, and growth stocks outperformed value stocks. • The best performing U.S. industry was technology, which rallied 12.57% in the first quarter.The second and third best performing industries were Consumer Discretionary 8.45% and Health Care 8.37%. • The energy sector performed worst in the first quarter, declining 6.68%. Telecom was the only other sector to post negative returns in the first quarter, with a decline of 3.97%. • Though interest rate volatility has begun to rise, overall interest rates were relatively flat in the first quarter. • Short term bonds generated returns of 0.57% in the first quarter, while intermediate term bonds generated 0.82% returns. 1-YEAR RETURNS S&P 500 Index + 6.07 + 17.17 + 13.30 + 7.51 US LargeValue + 3.27 + 19.22 + 13.13 + 5.93 US Small Cap + 2.47 + 26.22 + 12.36 + 7.12 US SmallValue – 0.13 + 29.37 + 12.55 + 6.09 International Large Cap + 7.25 + 11.67 + 5.83 + 1.05 International LargeValue + 6.05 + 15.98 + 5.56 + 0.05 International Small Cap + 7.97 + 10.99 + 9.20 + 3.03 International SmallValue + 7.35 + 13.82 + 9.27 + 2.98 Emerging Markets + 11.45 + 17.22 + 0.81 + 2.72 US Short-Term Bonds + 0.57 + 0.52 + 1.30 + 2.95 US Intermediate-Term Bonds + 0.82 + 0.44 + 2.34 + 4.27 Q1 2017 5-YEAR RETURNS 10-YEAR RETURNS ANNUALIZED see in the chart [on the bottom of page 2], they found a clear and consistent relationship between the number of stocks held in a portfolio and the likelihood of a portfolio outperforming its benchmark in both the short and long term. Diversification may not only reduce risk but may also increase the likelihood of the greatest financial success. We also know that by having as broadly diversified a portfolio as possible, it is better suited to address risks that fall outside of the performance of just the underlying stocks. By owning stocks in the roughly fifty countries that CCM portfolios have exposure to, you reduce the risks that currency movements can pose — beyond the value of the underlying holdings. In 2016, the strengthening dollar hindered the returns of most international stocks even though the companies fared well. So far this year the dollar has weakened, which provides a benefit to U.S. investors with assets invested abroad.4 With a diversified portfolio, we also see a reduction in unnecessary turnover, allowing for patient trading strategies to be employed.This helps to a) reduce transaction costs, and b) avoid potential tax liabilities which keeps money in the portfolio and out of others’ hands. The increased number of publicly traded companies over the past twenty years is a positive development for global investors. Increasing the number of companies available for investment benefits you by allowing for additional diversification as well as potentially improved performance. Normally we might think that too much of a good thing will turn out to be bad for us, but in the case of diversification that just isn’t so. Kenneth French, Professor of Finance at the Tuck School of Business at Dartmouth College, and Dimensional Fund Advisors Director and Consultant, sums up the role of diversification in saying,“Diversification is about the closest thing to a free lunch in capital markets, so you may as well get a huge helping of it.” 4 JP Morgan,“Guide to the Markets,” March 31, 2017, p. 42.