500 Lake Cook Road | Suite 210 | Deerfield, IL 60015 TEL 847.282.4225 FAX 312.962.3899 hightoweradvisors.

com

Securities offered through HighTower Securities, LLC | Member FINRA/SIPC/MSRB | HighTower Advisors, LLC is a SEC registered investment advisor




May 29, 2014


Dear Friends,

The investment decision making process has changed radically over the years. The days are long gone
when the central issue in managing money was to determine whether or not a particular company would
report earnings of X dollars per share or X plus 50 cents per share. It is also past the time when it was
fashionable to believe stock price changes were the result of random events. That position held that since
the market was efficient, the current price reflected all of the known available information. Price changes
were the result of events that could not be known, and hence were random.

Serious managers today place each individual investors needs at the front and center of their investment
decision making process. We recognize that everyone would like to have their portfolios generate both
more current income and greater price appreciation. We also recognize the reality that some stocks have
the potential to appreciate more than others; some may pay higher current dividends but offer less
opportunity for large future gains; and income securities, such as bonds, pay only a fixed amount of
interest until they mature.

Since your personal circumstances change over time, your preferences for income and growth can change
as well. And because economic, environmental, and political forces constantly shift, the market price and
potential opportunities of individual securities can vary as well. It follows that the proportion of your
total portfolio you commit to stocks or bonds, as well as which particular securities you hold in each
category should be reviewed on a regular basis.

At the present time, for example, we believe that interest rates are likely to rise because the pace of
economic activity is improving and spending on goods and services is rising. Equity prices, as measured
by both the S&P and Dow Jones indices have surpassed their 2007 peak, and much of the investment
wealth that was lost in the stock market during the crash in 2008 has now been recovered. As a result,
total expenditures are now on the rise, the number of people employed is increasing, and the memory of
the financial panic of a few years ago is beginning to fade.

When we do look backward it becomes clear that an extremely important factor leading to the recovery
of the economy was the Federal Reserve policy of expanding the money supply and the holding short
term interest rates at a near zero level. However the current low interest rate policy now gives rise to a
serious challenge for Chairman Janet Yellen and the other members of the Board of Governors of the
Federal Reserve System. The increased macro level of activity and spending underway could lead to an
increase in both product costs and consumer prices, which in turn may lead to a rise in interest rates.



500 Lake Cook Road | Suite 210 | Deerfield, IL 60015 TEL 847.282.4225 FAX 312.962.3899 hightoweradvisors.com

Securities offered through HighTower Securities, LLC | Member FINRA/SIPC/MSRB | HighTower Advisors, LLC is a SEC registered investment advisor





The prevailing view in some circles is that when interest rates increase, both bond and stock prices fall,
and such a drop could stop the expansion that is now emerging. We do not hold this position. Rather, we
believe that if the driving forces behind a modest rise in interest rates are a higher level of economic
activity and greater spending by the private sector, the demand for equities should increase, profits
should improve, new technologies should be developed, and stock prices could rise (even if bond prices
do not).

The practical implication of these remarks is that while your needs for both income and growth are going
to continue to evolve, investors should respond to changes in the economy that offer new market
opportunities. The proportion of assets you commit to growth stocks, high dividend paying equities, and
bonds, as well as the individual holdings in each of these three groups, should be reviewed.

We try to examine all of the individual holdings in all of your accounts at least once every two weeks,
and as you know from the number of confirmations you receive, we are prepared to make changes in
your holdings when a change is appropriate. In this review process we are sensitive to tax considerations
and carefully watch whether gains are going to be taxed at long or short term rates.

We understand that changes take place in both your personal lives and in the market place whether or
not you want them to happen. We take seriously our responsibility to be thoughtful about which
investment changes are appropriate for your accounts. Please let us know if we are meeting or fall short
of your expectations, because in the final analysis you, our clients, are our most important asset.

Sincerely,




Eugene Lerner
Managing Director, Partner

The Lerner Group is a group of investment professionals registered with HighTower Securities, LLC, member FINRA, MSRB and SIPC, and with HighTower Advisors,
LLC, a registered investment advisor with the SEC. Securities are offered through HighTower Securities, LLC; advisory services are offered through HighTower
Advisors, LLC.

This is not an offer to buy or sell securities. No investment process is free of risk, and there is no guarantee that the investment process or the investment
opportunities referenced herein will be profitable. Past performance is not indicative of current or future performance and is not a guarantee. The investment
opportunities referenced herein may not be suitable for all investors.

All data and information reference herein are from sources believed to be reliable. Any opinions, news, research, analyses, prices, or other information contained in
this research is provided as general market commentary, it does not constitute investment advice. The Lerner Group and HighTower shall not in any way be liable
for claims, and make no expressed or implied representations or warranties as to the accuracy or completeness of the data and other information, or for statements
or errors contained in or omissions from the obtained data and information referenced herein. The data and information are provided as of the date referenced.
Such data and information are subject to change without notice.

This document was created for informational purposes only; the opinions expressed are solely those of The Lerner Group and do not represent those of HighTower
Advisors, LLC, or any of its affiliates.