Performance Review for Quarter Ended 03/31/09 Dire economic data confirms that the global recession is indeed deep and widespread. Equity markets reacted negatively reaching a nadir on March 9 before turning abruptly and posting a substantial recovery by quarter-end. Despite the March rally, every economic sector and all but one developed equity market declined this quarter, as the deleveraging process continued to pressure virtually all asset prices globally. Due to strong stock selection, the Composite outperformed the MSCI EAFE® Index this quarter. The Portfolio’s relative outperformance can be attributed to holdings in the materials, semiconductor & semi equipment, technology hardware & equipment, and energy industry groups, while holdings in the insurance, diversified financials, banks, and utilities industry groups detracted from relative performance. The largest single contributor to return this quarter was metals & mining company, Rio Tinto (UK). Investors bid up shares, pleased by the Company’s announcement of an expected large equity stake from Chinese aluminum producer, Chinalco, as well as a proposed asset sale, both of which will provide relief to Rio’s debt-heavy balance sheet. Additional notable contributors to return included two energy services companies, Technip (France) and Aker Solutions (Norway), athletic shoe manufacturer and retailer, Yue Yuen (Hong Kong), and telecommunications equipment manufacturer, Ericsson (Sweden). Several of the largest individual detractors from performance this period provide insurance products, including companies such as ING Groep (the Netherlands), Manulife Financial (Canada), AXA (France), Sony Financial (Japan), and Zurich Financial Services (Switzerland). Insurers hold large portfolios of bonds and equities, and therefore their share prices are highly correlated to the performance of securities markets. We continue to own shares in all but one of these well managed insurers because the valuations are extremely low, and we believe the losses on investable assets will likely prove to be less than what is discounted in current prices. Furthermore, life insurers hold assets to match long-term liabilities, with hedges of similar duration. Policyholders face large penalties for cancelling insurance policies (unlike bank depositors); thus we believe the insurers have considerably more stable earnings than suggested by their collapsing share prices.* *The securities identified and described above do not represent all of the securities purchased, sold or recommended for client accounts. The reader should not assume that an investment in the securities identified was or will be profitable. Past performance does not guarantee future results. For a description of our performance attribution methodology, or to obtain a list showing every holding's contribution to the overall account's performance during the quarter, please contact our product manager, Kevin Moutes, at 310-231-6116 or moutes@causewaycap.com.