What is infrastructure?
What investment opportunities are available in infrastructure securities today?
How can infrastructure benefit my investment portfolio?
How does infrastructure diversify my portfolio?
What is the size and scope of the global infrastructure market?
What is Kensington's investment approach?
What is the future outlook for infrastructure?
What risks must an investor consider?

What is infrastructure?

The infrastructure asset class provides the basic building blocks required for communities to function, encompassing transportation, communication, energy, utilities and infrastructure-related industries.  A critical component of a society’s vitality, infrastructure directly impacts economic growth, competitiveness, productivity and overall quality of life.

What investment opportunities are available in infrastructure securities today?

Today, there is a liquid market of infrastructure securities available for investors to access companies involved in the ownership, management, development and/or financing of essential services for the advancement of communities around the world.

From a broad universe of infrastructure securities, two compelling investment themes emerge.  We believe that investors can benefit from access to:

• Mature Infrastructure includes investments in companies in traditionally monopolistic industries with mature, long-life assets. These companies' predictable, inflation-linked cash flow make them attractive, offering a lower-risk, moderate return profile that is often typical of hard-asset backed, cash flow-driven investments.
• Infrastructure Development focuses on companies that will benefit from the surge in infrastructure spending expected around the globe—particularly in the fastest-growing emerging markets, where demand for new structures and services is most dire. While these investments can carry more volatility and development risk than mature companies, we believe that companies involved in the build out of basic structures provide an important growth-oriented component to a well-diversified infrastructure allocation.

How can infrastructure benefit my investment portfolio?

As measured by the S&P Global Infrastructure Index, global infrastructure stocks have historically provided:

Competitive Total Returns	Infrastructure stocks have historically delivered competitive returns relative to broader equities.
Current Income & Opportunity for Long Term Growth	Dividend yields vary, but infrastructure stocks typically offer competitive current income as compared with broader equities. Companies in regulated, monopolistic industries tend to exhibit more bond-like qualities, whereas development-driven businesses rely more on growth.
Daily Liquidity	Shares are priced real time and can be bought and sold on stock exchanges around the world.

How does infrastructure diversify my portfolio?

Infrastructure securities have historically shown a low correlation to other asset classes.

	Infra.	Stocks	Bonds	Real Estate
Global Infrastructure Index	1.00
World Stock Index	0.75	1.00
World Government Bond Index	0.30	0.06	1.00
Global Real Estate Index	0.63	0.67	0.23	1.00

Correlation is a statistical measure of how two investments move relative to one another. A perfect correlation of +1 indicates that both investments always move together, whereas a correlation of 0 indicates there is no relationship between the two investments.

Diversifying your portfolio across non-correlated investment types, including stocks, bonds and alternative investments like infrastructure can help increase returns and lower risk over the long term.

What is the size and scope of the global infrastructure market?

As of March 31, 2008, there were 75 infrastructure companies in 23 countries valued at approximately $1.4 trillion (per Standard and Poors).

What is Kensington's investment approach?

Kensington endeavors to add value above benchmark returns by stock selection, sector rotation, and our skill at actively managing the portfolio.  Using a fundamental, bottom-up investment approach and top-down country analysis, our research team is focused on understanding the cash flow, assets and management of each company in which we invest.

Cash Flow	Detailed analysis includes income, capital expenditures and financing
Assets	Evaluation of private market value and the quality of underlying assets
Management	Assessment of the quality and track record of the management team

What is the future outlook for infrastructure?

In our view, powerful secular trends will propel infrastructure returns and continue to serve as catalysts for infrastructure spending worldwide. These include:

• A tremendous need for new development and redevelopment of inferior infrastructure networks
• Globalization forces challenging governments to provide the infrastructure necessary to drive productivity and economic growth
• Population growth and urbanization trends
• Private sector financing of government-operated assets will continue to proliferate as an effective way to close spending gaps and improve efficiency

Coupled with demographic shifts driving investors to seek out income-oriented, asset-backed investments, the infrastructure asset class will attract investors for its solid long term growth prospects and meaningful diversification benefits. For all of these reasons, we expect that over time, global infrastructure will become a cornerstone of investment portfolios.

What risks must an investor consider?

Specific risks to investment in infrastructure include development and operational risks, which could cause cost overruns, and for some companies, regulatory risk and interest rate sensitivity are factors.  The political climate may also play a role in how widely public-private partnerships are adopted in the U.S. and other countries, which can affect private participation opportunities.

Investing in foreign securities involves risks such as currency fluctuations, political and economic uncertainties and differences in accounting standards.