The International Small Cap Equity Portfolio is closed effective October 31, 2005.

Today, over half of the world’s equity value is located outside the United States. This means that substantial investment opportunities are located in non-U.S. markets.  In any given year, a number of non-U.S. markets generally outperform the U.S. market.  Therefore, greater numbers of U.S. investors are placing assets in overseas markets.

Our International Small Cap Equity Portfolio applies aGraham & Dodd value approach to stock selection. Generally, a security will be bought if it is trading below what we believe to be its estimated value.  This conservative approach strives to provide investors with a margin of safety.  We believe that proper analysis can uncover good values anywhere in the world, thereby significantly expanding the number and scope of investment opportunities.

For long-term investors, smaller-cap stocks have historically offered greater returns than larger-cap stocks in international markets.  However, markets for small-cap securities may be more volatile and less liquid than thosefor larger companies.  Also, investing internationally involves unique risks, including the potential for political, economic, and currency instability. Investors should carefully consider these risks in the context of their overall objective, time horizon, and asset allocation prior to investing.

The International Small Cap Equity Portfolio Seeks to Offer:

• A disciplined approach to investing in non-U.S. markets and companies
• Diversification for investors with portfolios over-weighted in U.S. equities
• Additional diversification in international markets through exposure to smaller companies
• Long-term capital appreciation

Features:

• Undervalued international stocks
• Smaller-cap companies with potential to appreciate
• Companies with comparatively low price/cash flow, price/earnings, and price/book valuation ratios
• Diversification across a wide range of countries and industries