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Global Real Estate Index

as of 12/31/17

Fund Commentary

In the fourth quarter of 2017, the FTSE® EPRA®/NAREIT® Global Index returned 3.56% underperforming the broader global equity market, represented by MSCI World Index, which returned 5.51% in the fourth quarter.

The top-performing countries over this time period were India and Austria, returning 40.55% and 14.28%, respectively. Mexico and United Arab Emirates were the worst-performing countries for this quarter, with returns of -11.59% and -7.14%, respectively.

During the quarter, the Global Real Estate Index Fund returned 3.49%, in-line with the FTSE® EPRA®/NAREIT® Global Index returns of 3.56%. Global equity returns have remained strong through the fourth quarter of 2017. U.S. equities in the fourth quarter of 2017 continued to rally off of the strong first three quarters of the year. The S&P 500 Index posted, for the first time ever, positive performance in each of the 12 months of a calendar year, pushing the index to new all-time highs for the quarter, and keeping volatility near all-time lows. Market participants continued to shrug off geopolitical turmoil in North Korea and the Middle East, and instead focused on continued global growth. The fourth quarter also saw the Federal Reserve begin the process of unwinding their balance sheet while keeping with intentions for continued gradual interest rate increases. These announcements, coupled with the late year passing of U.S. tax reform, lead to an increase in market optimism and interest rates, benefitting equities on the whole. Developed ex U.S. markets continued the strong performance during the 4th quarter, led by Japan, but underperformed U.S. equities. Strong economic growth has been supported by low global interest rates, modest inflation, and stable labor markets. Manufacturing and industrial production in Japan and the Eurozone continue to indicate economic improvements and future growth.

Not FDIC insured | May lose value | No bank guarantee

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