Artifex Folio Model Updates

Model: AFG ROE

Date: January 6, 2014Doug Kinsey, CFP, AIFA

Chief Investment Officer

The AFG ROE Model!

Based on Zacks research which identifies top performing companies through their Return on Equity (ROE) metrics. ROE is a measure of management talent, reflecting asset allocation decisions. Is the company burning cash or creating assets?

The parameters for inclusion are normally:

ROE>10%

Price to Sales Ratio <1

Research Ranking = 1

Average brokerage community ranking = “hold” or better.

The ROE Model tends to be weighted toward small and mid-size companies

Additional ROE Model Statistics as of 1/6/2014

Statistic Model Holdings One-Year Risk Profile S&P 500

Beta vs. S&P 500 / Relative Risk

1.14 / Above Average -/NA 1.00 / Average

Volatility / Absolute Risk 15.95% / Average - / NA 10.85% / Below Average

Statistic Model Securities in Calculation* S&P 500

Price / Earnings 13.10 17 out of 18 16.88

Price / Sales 0.64 17 out of 18 1.65

Earnings per Share 2.62 17 out of 18 2.51

Dividend Yield 0.68 17 out of 18 1.96Market Capitalization 7.33 B 17 out of 18 125.07 B

*Number of total securities with available data from our vendor

(Information provided by Folio Institutional)

Inception Date Benchmark Return YTD Benchmark Return YTD

Return Since Inception

Benchmark Return Since Inception

1/1/2013 S&P 500 Total Return 52.10% 26.96% 52.10% 26.96%

AFG ROE Results as of 12/31/2013*

*Information provided by Folio Institutional - an independent investment custodian that provides client account and portfolio management services to Artifex financial Group and is unaffiliated with Artifex

Financial Group other than as a vendor.

AFG ROE Holdings as of January 2014Symbol Security %

Weight Change Since Purchase

ANFI AMIRA NATURE FOODS 5.89 93.38%

AFSI AMTRUST FINANCIAL* 5.68 -0.66%

ARW ARROW ELECTRONICS 5.75 9.8%

BBSI BARRETT BUSINESS SYSTEMS 5.83 55.21%

CVGW CALAVO GROWERS INC 5.96 3.17%

GSOL GLOBAL SOURCES LTD. 5.66 18.47%GBX GREENBRIER COMPANIES INC 5.78 2.96%

GMK GRUMA SA DE C.V. ADS* 5.69 -0.35%

HUM HUMANA INC 5.71 9.74%

JAH JARDEN CORP 5.85 33.17%

JOUT JOHNSON OUTDOORS, INC 5.89 4.22%

LAD LITHIA MOTORS INC 5.76 10.97%

MHO M/I HOMES 5.89 21.02%

OME OMEGA PROTEIN CORP 5.47 -10.37%

PKG PACKAGING CORP. OF AMERICA* 5.83 1.77%

REGI RENEWABLE ENERGY GROUP INC. 5.64 -7.31%

VLKAY VOLKSWAGEN AG ADR 5.74 17.17%

FDIC.CASH CASH / MONEY MARKET 1.98 N/A

Portfolio Changes and Rationale

Updated January 7, 2014

Symbol Security Change Since Purchase Reasoning Research Link Sale Date

CMLS CUMULUS MEDIA 47%Far Exceeded appreciation expectations

Currently a negative ROE at -20.6%Relatively high P/E at 24X

CMLS Report 1/6/2014

LIOX LIONBRIDGE TECHNOLOGIES INC -1.02%

Lack of performanceHigh P/E at 41.48X relative to ROE at

12.7%LIOX Report 1/6/2014

ASGN ON ASSIGNMENT INC 28%Exceeded target price

P/E of 30XROE below minimum @ 8.5%

ASGN Report 1/6/2014

-Sales-

Symbol Security Change Since Purchase Reasoning Research Link Purchase Date

AFSI AMTRUST FINANCIAL SERVICES INC -0.66%

Strong ROE Performance at 18% - 23%Reasonable valuation at a 10x P/E

Attractive P&C Ins niche player w/ great Combined Ratios

AFSI Report 1/6/2014

GMK GRUMA SA DE C.V. -0.35%

ROE @ 13% relative to ind avg of 9%Strong earnings growth of 340% in 2013

Mexican producer of corn flour, wheat flour, tortillas and other products

GMK Report 1/6/2014

PKG Packaging Corp of America 1.77%

ROE @ 27%Strong EPS Growth @ 15%

ROE below minimum @ 8.5%One of the largest producers of corrugated

packaging in the US.

PKG Report 1/6/2014

-Purchases-