HISTORICAL PERFORMANCE: HYPOTHETICAL NATURE

The simple nature of the risk reduction models employed to generate the returns shown on this site should enable them to be effective portfolio management tools in the future. Moreover, the testing on historical data covers a large number of years and wide range of market conditions, both in secular bull and secular bear markets. The strong performance of the simple models over a long time and wide range of market conditions indicates that these models are quite likely to continue to be useful risk reduction tools.

However, it is important to note that the investment returns shown elsewhere on the site are hypothetical. There are significant differences between hypothetical returns and returns from actual investments. In particular:

1. Hypothetical and backtested results do not result from actual trading using client assets. Although index mutual funds are the most likely investment vehicles and given their size it takes very large amounts of inflows or outflows to affect the broad markets, it is possible that MDP Associates trading of actual client accounts could have significantly affected the transaction prices.
2. The results shown may be from retroactive application of a model that was designed with the benefit of hindsight. (Since the models were not designed by MDP Associates, the extent to which this is true is unknown.)
3. Hypothetical performance information may not reflect the impact that any material market or economic factors might have had on MDP Associates' use of the investment methods if the methods had been used during the backtesting period in the actual management of client accounts

Perhaps the most important disclosure is the universal: past performance is no guarantee of future results. You should not assume that any of the returns shown here will be obtained in the future. It is possible that the methods and managed account clients will lose money.

MDP Associates is a Registered Investment Advisor (RIA). Before you contact any RIA firm, you should know the following:

1. An investment advisor (IA) or IA representative (IAR) may only transact business in a particular state after licensure or satisfying qualifications requirements of that state, or only if they are excluded or exempted from the state's IA or IAR requirements, as the case may be; and
2. Follow-up, individualized responses to consumers in a particular state by IA or IAR that involve either the effecting or attempting to effect transactions in securities or the rendering of personalized investment advice for compensation, as the case may be, shall not be made without first complying with the state's IA or IAR requirements, or pursuant to an applicable state or federal exemption or exclusion.
3. For information concerning the licensure status or disciplinary history of an IA or IAR, a consumer should contact his or her state securities law administrator.

MDP Associates is licensed in Virginia, its home state, and some other states. (Legislation passed by Congress in 1997 precludes registration with the SEC because of the amount of assets currently under management.) MDP Associates is eligible to have clients in any state due to either being licensed by the state or being exempted under state or federal laws. New clients are currently being accepted from all states and DC.