As we move toward the final quarter of 2025, the LSA Investment Policy Committee is taking proactive steps to ensure that portfolios remain aligned with evolving market conditions. Economic growth continues, though at a more balanced pace, with moderating inflation and ongoing shifts in policy expectations shaping both equity and fixed-income dynamics. Against this backdrop, the committee has elected to implement model updates across all platforms to reflect our current views on opportunity, risk, and diversification.

Model Update Schedule

• Posted Tuesday, October 28th – American Funds, BME, CBP, ETF, Private Client Blended, and Private Client L100k – Targeted model update – Tuesday, November 4th.
• Posted Wednesday, October 29th – PC IQ, Private Client, PC Trad, and ETF Tactical– Targeted model update – Wednesday, November 5th.
• Posted Thursday, October 30th – PC Sleeve, PC Income Strat, PC Tax Eff – Targeted model update – Thursday, November 6th.
• Posted Tuesday, November 4th – Impact Series, DFA, DFA Blended, Fidelity, and Vanguard – Targeted model update – Thursday, November 11th.

VA and VUL model updates will be posted the week of November 10th.

The mutual fund model revisions impact the NTF models as well.
As a reminder, the Revision Explanation will be posted in the “Portfolio News” section on each platform home page.

Investment Rationale Note: Resetting Risk, Rebalancing Opportunity

After several quarters of solid market performance, portfolio drift has increased as different asset classes have moved unevenly. To ensure that risk controls and intended exposures remain aligned with our strategic objectives, the committee is encouraging a full rebalance across all models. This update is designed to recalibrate exposures, manage interest-rate sensitivity, and reintroduce balance between domestic and international equity opportunities.

Core Themes Driving This Revision

1. Managing Duration While Maintaining Quality
   Bond markets continue to stabilize following the rapid repricing of rate expectations earlier in the year. With inflation moderating and the Fed signaling flexibility, we see a window to extend duration modestly while maintaining a focus on high-quality issuers. This adjustment is designed to add resilience should yields move lower into 2026, while avoiding unnecessary credit risk in the later stages of the cycle.
2. Focusing on U.S. Equity Leadership and Top Performers
   Domestic equities remain the cornerstone of growth-oriented portfolios. Our focus is on identifying leading managers and sectors driving sustainable performance, with attention to innovation, balance sheet strength, and earnings durability. We are refining exposures to ensure that portfolios capture top-tier U.S. performance while mitigating concentration in overextended areas.
3. Reintroducing Select International Exposure
   We continue to believe diversification beyond U.S. borders adds meaningful value over the long term. As policy cycles diverge and valuations remain favorable overseas, the committee is gradually increasing targeted international exposure, particularly in regions showing improving growth trends and attractive risk-adjusted return profiles.

This model revision represents a disciplined reset—realigning portfolios to their intended risk posture, refreshing manager exposure, and maintaining quality across asset classes. As always, the committee remains focused on long-term outcomes, risk-adjusted returns, and ensuring that each model reflects our best thinking on the current investment landscape.