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Supplemental Investment Fund <br /> <br />Growth Share Account <br /> <br />Objective <br />The investment objective of the <br />Growth Share Account is to generate <br />high returns from capital <br />appreciation. To achieve this <br />objective, the Account is invested <br />primarily in U.S common stock. <br /> <br />At the close of fiscal year 1999, the <br />value of the Growth Share Account <br />was $323 million. <br /> <br />Management <br />The assets of the Growth Share <br />Account are invested by the external <br />active and semi-passive domestic <br />equity managers. This allocation <br />reflects a more aggressive investment <br />than is available through passive <br />management. Since July 1997, these <br />assets have been managed by the <br />same active and semi-passive <br />managers utilized by the Basic and <br />Post Retirement Funds in the <br />Domestic Stock Pool. (Prior to July <br />1997, the Account used only active <br />managers.) The Account may hold a <br />small amount of cash that represents <br />new contributions received prior to <br />their investment in the market and <br />cash that may be held by the <br />individual managers in the Account. <br /> <br />Performance <br />Like the Income Share Account, the <br />Board evaluates the performance of <br />the Growth Share Account on two <br />levels: <br /> <br />Total Account. The Growth <br />Share Account is expected to <br />exceed the returns of the <br />Wilshire 5000. <br /> <br />Individual Manager. <br />Performance objectives for the <br />individual managers are <br />described in the Investment <br />Pool section. <br /> <br />The Growth Share Account provided <br />a return of 17.3% for the fiscal year, <br />underperforming its composite index <br />by 2.3 percentage points. Individual <br />manager performance relative to <br />their benchmarks was mixed, see the <br />discussion starting on page 14 <br />concerning the Domestic Stock Pool. <br />Over the most recent three years, the <br /> <br />Account has outperformed by 0. <br />percentage point annually while <br />Account has underperformed by <br />percentage point annually over ~ <br />last five years. A five year histo~ <br />performance results is shown in <br />Figure 27. <br /> <br />Figure 22 Growth Share Account FY 1995-1999 <br /> <br />1 Grrx~h <br /> Share <br /> <br />B~te* <br /> <br /> 35 <br /> <br /> 3O <br /> <br /> 25 <br /> <br /> 20 <br /> <br />~_ 15 <br /> <br /> 10 <br /> <br /> 5 <br /> <br /> 0 <br /> <br />1995 1996 1997 1998 1999 3Yr. 5Yr. <br /> <br /> Annualized <br /> 1995 1996 1997 1998 1999 3 Yr. 5 Yr <br />Growth Share 23.3% 24.6% 29.5% 31.2% 17.3% 25.9% 25.1'; <br />Composite* 23.7 25ol 29.2 28.9 t9.6 25.8 25.2 <br /> <br />* 95% Wilshire 5000/5% T-Bill Composite through October 1996. <br /> 100% Wilshire 5000 since November 1996. <br /> <br />26 <br /> <br /> <br />