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Ascendere Associates LLC September 30, 2014

J. Stephen Castellano Page 1 steve@ascenderellc.com


Ascendere Associates LLC Innovative Long/Short Equity Research

Model Portfolio Monthly Update: September 30, 2014
There are limitations inherent in our theoretical model results, particularly with the fact that such results do not represent actual trading and
they may not reflect the impact material economic and market factors might have had on our decision making if we were actually managing
client money. Please see additional disclaimers and disclosures at the back of this report.

We highlight stocks that demonstrate solid growth at a reasonable price (GARP). Stocks selected for our model portfolio strategies all rank highly
for the following metrics, with an emphasis on proxies for cash flow growth and ROIC:

Relative Value
Operating Momentum
Analyst Revision Momentum
Fundamental Quality

Page 2 contains rebalancing actions for our long-only model portfolio.

Page 3 contains rebalancing actions for our short-only model portfolio.

Target and stop prices, as well as updated return data, to be provided in our daily reports that will follow.


Ascendere Associates LLC September 30, 2014
J. Stephen Castellano Page 2 steve@ascenderellc.com

Long Model Portfolio -- Rebalancing Actions






9/30/2014 Rebalancing
Core and Opportunistic Long Portfolio:
25 stocks in the model portfolio = 4.00% weight per position
Close Position Hold/Rebalance Open Position
Omnicom Group Inc. OMC GameStop Corp. GME Magna International Inc. MGA
FMC Technologies, Inc. FTI The Home Depot, Inc. HD Foot Locker, Inc. FL
AllianceBernstein Holding L.P. AB Tata Motors Limited TTM Pilgrim's Pride Corporation PPC
Biogen Idec Inc. BIIB Halliburton Company HAL CVS Health Corporation CVS
Paychex, Inc. PAYX The Blackstone Group L.P. BX Anixter International Inc. AXE
The Sherwin-Williams Company SHW Lazard Ltd. LAZ
Affiliated Managers Group Inc. AMG
Primerica, Inc. PRI
Protective Life Corporation PL
Gilead Sciences Inc. GILD
Align Technology Inc. ALGN
VCA Inc. WOOF
Allergan Inc. AGN
Huntington Ingalls Industries, Inc. HII
Trinity Industries Inc. TRN
Robert Half International Inc. RHI
ManpowerGroup Inc. MAN
Snap-on Incorporated SNA
Brocade Communications Systems, Inc. BRCD
Source: Ascendere Associates LLC Skyworks Solutions Inc. SWKS
Ascendere Associates LLC September 30, 2014
J. Stephen Castellano Page 3 steve@ascenderellc.com
Short Model Portfolio -- Rebalancing Actions
When the market anticipates an improving economy from low price levels, low-quality stocks will at times out-perform high-quality stocks as the
expected improvements in fundamentals are discounted from a relatively more depressed price level.













9/30/2014 Rebalancing
Core and Opportunistic Short Portfolio:
21 stocks in the model portfolio = 4.76% weight per position
Close Position Hold/Rebalance Open Short Sale
Allscripts Healthcare Solutions, Inc. MDRX General Motors Company GM Pioneer Natural Resources Co. PXD
Cepheid CPHD Dresser-Rand Group Inc. DRC Williams Companies, Inc. WMB
CoreLogic, Inc. CLGX Golar LNG Ltd. GLNG ING Groep N.V. ING
JDS Uniphase Corporation JDSU Memorial Resource Development Corp. MRD Popular, Inc. BPOP
Yahoo! Inc. YHOO Credit Suisse Group AG CS Joy Global, Inc. JOY
Carpenter Technology Corp. CRS Deutsche Bank AG DB
Cubist Pharmaceuticals Inc. CBST
Alkermes plc ALKS
Jacobs Engineering Group Inc. JEC
Kennametal Inc. KMT
Eaton Corporation plc ETN
KBR, Inc. KBR
3D Systems Corporation DDD
SunEdison, Inc. SUNE
CRH plc CRH
Source: Ascendere Associates LLC Allegheny Technologies Inc. ATI
Ascendere Associates LLC September 30, 2014
J. Stephen Castellano Page 4 steve@ascenderellc.com


Return Data





Core & Opportunistic Long Model MTD Theoretical Longs Stopped Out on 8/4/2011 close for a -12.33% loss
8/31/2014 to 9/30/2014
Target/ Date+1
Sector Company Ticker 8/31/2014 9/30/2014 Performance Stop Date Sell Price Return
Health Care Allergan Inc. AGN 163.68 178.19 8.86%
Information Technology Paychex Inc. PAYX 41.65 44.20 6.12%
Information Technology Brocade Communications Systems, Inc. BRCD 10.55 10.87 3.03%
Information Technology Skyworks Solutions Inc. SWKS 56.66 58.05 2.45%
Industrials Huntington Ingalls Industries, Inc. HII 102.11 104.21 2.06%
Consumer Discretionary Sherwin-Williams Co. SHW 218.11 218.99 0.40%
Financials Protective Life Corp. PL 69.40 69.41 0.01%
Health Care Gilead Sciences Inc. GILD 107.56 106.45 -1.03%
Consumer Discretionary The Home Depot, Inc HD 93.50 91.74 -1.88%
Consumer Discretionary GameStop Corp. GME 42.20 41.20 -2.37%
Industrials Robert Half International Inc. RHI 50.21 49.00 -2.41%
Consumer Discretionary Snap-on Inc. SNA 124.95 121.08 -3.10%
Industrials Trinity Industries Inc. TRN 48.38 46.72 -3.43%
Health Care VCA Antech Inc. WOOF 40.75 39.33 -3.48%
Health Care Biogen Idec Inc. BIIB 343.04 330.81 -3.57%
Financials Primerica, Inc. PRI 50.33 48.22 -4.19%
Consumer Discretionary Omnicom Group Inc. OMC 72.01 68.86 -4.37%
Energy Halliburton Company HAL 67.61 64.51 -4.59%
Health Care Align Technology Inc. ALGN 54.46 51.68 -5.10%
Financials Affiliated Managers Group Inc. AMG 211.15 200.36 -5.11%
Financials AllianceBernstein Holding L.P. AB 27.66 26.01 -5.97%
Financials The Blackstone Group BX 33.53 31.48 -6.11%
Financials Lazard Ltd. LAZ 54.66 50.70 -7.24%
Industrials Tata Motors Ltd. TTM 48.19 43.71 -9.30%
Industrials Manpower Inc. MAN 77.58 70.10 -9.64%
Energy FMC Technologies, Inc. FTI 61.84 54.31 -12.18%
Ascendere Associates LLC September 30, 2014
J. Stephen Castellano Page 5 steve@ascenderellc.com






Core & Opportunistic Short Model MTD Theoretical shorts hit target 8/4/2011 for 14.84% gain
8/31/2014 to 9/30/2014
Target/ Date+1
Sector Company Ticker 8/31/2014 9/30/2014 Performance Stop Date Sell Price Return
Materials Carpenter Technology Corp. CRS 54.73 45.15 -17.50% 9/15/2014 52.02 $ -4.95%
Industrials KBR, Inc. KBR 22.02 18.83 -14.49% 9/19/2014 20.10 $ -8.72%
Information Technology SunEdison, Inc. SUNE 22.03 18.88 -14.30% 9/23/2014 20.28 $ -7.94%
Information Technology 3D Systems Corp. DDD 53.51 46.37 -13.34% 9/29/2014 46.37 $ -13.34%
Materials Allegheny Technologies Inc. ATI 42.17 37.10 -12.02% 9/25/2014 39.01 $ -7.49%
Industrials Jacobs Engineering Group, Inc. JEC 53.91 48.82 -9.44% 9/23/2014 50.34 $ -6.62%
Industrials Eaton Corp. ETN 69.81 63.37 -9.23% 9/22/2014 65.14 $ -6.69%
Healthcare Allscripts Healthcare Solutions, Inc. MDRX 14.78 13.42 -9.20% 9/25/2014 13.54 $ -8.36%
Consumer Discretionary General Motors Company GM 34.80 31.94 -8.22% 9/25/2014 33.17 $ -4.68%
Energy Memorial Resource Development Corp. MRD 29.47 27.11 -8.01% 9/25/2014 26.72 $ -9.33%
Industrials Kennametal Inc. KMT 44.81 41.31 -7.81% 9/22/2014 42.27 $ -5.67%
Information Technology CoreLogic, Inc. CLGX 28.27 27.07 -4.24%
Health Care Alkermes, Inc. ALKS 44.73 42.87 -4.16%
Health Care Cubist Pharmaceuticals Inc. CBST 69.03 66.34 -3.90%
Financials Credit Suisse Group CS 28.24 27.64 -2.12%
Materials CRH plc CRH 23.24 22.81 -1.85%
Financials Deutsche Bank AG DB 34.31 34.86 1.60%
Energy Golar LNG Ltd. GLNG 63.00 66.40 5.40% 9/16/2014 71.25 $ 13.10%
Information Technology Yahoo! Inc. YHOO 38.51 40.75 5.82% 9/8/2014 40.78 $ 5.89%
Health Care Cepheid CPHD 40.03 44.03 9.99% 9/10/2014 43.67 $ 9.09%
Information Technology JDS Uniphase Corp. JDSU 11.55 12.80 10.82% 9/11/2014 13.43 $ 16.28%
Energy Dresser-Rand Group Inc. DRC 69.30 82.26 18.70% 9/19/2014 81.97 $ 18.28%
Ascendere Associates LLC September 30, 2014
J. Stephen Castellano Page 6 steve@ascenderellc.com



* Return figures are calculated using cumulative simple returns. This table represents returns of several theoretical portfolios that do not assume any costs. This table is not to
be construed as advertising for any investment service. Real portfolios that attempt to exactly replicate these theoretical strategies will generate lower returns relative to these
models due to slippage, transaction costs, tax expenses and other costs. There are limitations inherent in our theoretical results, particularly with the fact that such results do
not represent actual trading and they may not reflect the impact material economic and market factors might have had on our decision making if we were actually managing
client money. We do our best to provide accurate information, but do not guarantee this. Please see additional disclosures and disclaimers.



Theoretical Model Portfolio* 09/30/14 MTD YTD
Since
03/31/09 Sharpe
Simple Returns (No Compounding)
Stock Targets Core Model
Long -0.44% -2.75% 6.92% 145.6% 1.04
Short 0.12% -1.82% 2.16% 88.1% 0.71
Core Long/Short -0.56% -0.94% 4.76% 57.4% 0.57
Stock Targets and Opportunistic Model
Portfolio Targets Long -0.44% -2.51% -0.08% 129.7% 1.21
Short 0.00% -1.82% 1.84% 39.3% 0.30
Opportunistic Long/Short -0.44% -0.70% -1.92% 90.4% 1.01
Stock Targets and Opportunistic Model III
Portfolio Targets Long Stocks -0.44% -2.51% -0.08% 129.7% 1.21
Long Inverse ETF ^SH 0.00% 1.30% -7.85% -73.3% (1.04)
Opportunistic Long/Short III -0.44% -1.21% -7.93% 56.5% 0.67
S&P 500 Index -0.60% -1.53% 6.88% 98.21% 1.06
Ascendere Associates LLC September 30, 2014
J. Stephen Castellano Page 7 steve@ascenderellc.com

Ascendere Associates LLC September 30, 2014
J. Stephen Castellano Page 8 steve@ascenderellc.com




Ascendere Associates LLC September 30, 2014
J. Stephen Castellano Page 9 steve@ascenderellc.com

DISCLOSURES
Ascendere is in the business of providing equity research and related consulting services to investors and their advisors. The equity research it provides includes basic
quantitative model portfolios and more detailed fundamental research with respect to individual stocks. In addition, the firm manages stock portfolios for itself and clients.

Ascendere does not rate stocks on any scale, but does offer individual stock commentary and valuation opinions. With regard to Ascendere's portfolio strategies, "long" or
"high-quality" baskets should generally be considered buys, unless otherwise noted. Stocks in our "short" or "low-quality" baskets should generally be considered sells, unless
otherwise noted. While exceptions may occasionally occur, typically stocks in the high-quality basket are expected to outperform the S&P 500 over a month's time and stocks in
the low-quality basket are expected to underperform. A more relevant benchmark would comprise of all stocks and ADRs that trade on major U.S. stock exchanges with a
market cap above $2 billion.

Ascendere adheres to professional standards and abides by codes of ethics that put the interests of clients ahead of its own. The following are specific disclosures made by
Ascendere:
1) Ascendere may have a financial interest in the companies referred to in this report ("the Companies"). The research analyst covering the Companies and members
of the analyst's immediate family have a financial interest in one or more of the Companies.
2) Ascendere generates revenue from research subscription revenue and portfolio management fees. At any given time it may be long or short any of the Companies.
3) Ascendere does not make a market in the securities of any of the Companies.
4) Ascendere has not received compensation from the Companies.
5) Ascendere has not managed or co-managed a public offering for any of the Companies.
6) Neither Ascendere nor any of its officers or any family member of the covering analyst serve as an officer, director or advisory board member of any of the
Companies.
7) Neither Ascendere nor any of its officers or any family member of the covering analyst beneficially own 1% or more of any class of securities of any of the Companies.


DISCLAIMERS
This report is intended for informational purposes only and does not constitute a recommendation, or an offer, to buy or sell any securities or related financial instruments. The
report is not intended to be in furtherance of the specific investment objectives, financial situation, or particular needs of any individual recipient. Investment decisions should
be based on an individual's own goals, time horizon and tolerance for risk. The information contained herein accurately reflects the opinion of Ascendere at the time the report
was released. The opinions of Ascendere are subject to change at any time without notice and without obligation or notification. The officers, affiliates or family members of
Ascendere Associates may hold positions in the securities of the Companies. No warranty is made as to the accuracy of the information contained herein. The views and
opinions expressed in the market commentary reflect the opinions of the author and may be based upon information obtained from third-party sources believed to be reliable
but not guaranteed. These opinions are subject to change at any time based upon market or other conditions. Ascendere disclaims any responsibility to update such views.
This information is intended for the sole use of clients of Ascendere. Any other use, distribution or reproduction is strictly prohibited. Investing in stocks includes a high degree
of risk, including the risk of total loss. This is for informational purposes only and is not intended to constitute a current or past recommendation, investment advice of any kind,
or a solicitation of an offer to buy or sell any securities or investment services. All information, opinions and estimates are current as of original distribution by author and are
subject to change at any time without notice. Any companies, securities and/or markets referenced are solely for illustrative purposes. Past performance is not indicative of
future performance, and no representation or warranty, express or implied, is made regarding future performance.

For Investment Professional use only. NOT FOR FURTHER DISTRIBUTION. Any dissemination or copying of this commentary is strictly prohibited.
Ascendere Associates LLC September 30, 2014
J. Stephen Castellano Page 10 steve@ascenderellc.com
J. Stephen Castellano founded Ascendere Associates LLC to provide innovative equity research
and investment advisory services that blends fundamental and quantitative approaches.

In general, our approach is quite simple -- we believe that return on invested capital and long-term
earnings growth are key to stock valuation. More specifically, we use powerful and unique financial
models that combine publicly available data, consensus estimates and our own inputs to generate
consistent and actionable stock recommendations.

Among the services that Ascendere provides are: 1) detailed custom equity research analysis; 2) valuation scenario analysis
studies; 3) supply /demand studies; 4) long and short stock idea generation; 5) portfolio feedback; 6) detailed fundamental
financial modeling services; and 7) additional analytical consulting services. Additional information is available at
www.ascenderellc.com.

Mr. Castellano has over 15 years of experience in equity research and related consulting work. At PaineWebber, Warburg
Dillon Read and Credit Lyonnais Securities he developed fundamental equity valuation models and conducted in-depth
research on the steel and telecom services industries. At Boston Private Value Investors, he developed quantitative models
for stock idea generation and also provided general fundamental equity research coverage. Steve received a MBA from the F.
W. Olin School of Business at Babson College (2005) and a BA from Oberlin College (1993).

Mr. Castellano's career history is highlighted below:

Startup Ecommerce Company (2013-Present)
Ascendere Associates, LLC (2009-Present)
Boston Private Value Investors , Equity Research, Equity Research Analyst (2005-2009)
Pyramid Research, Contract Consultant, Telecom Services (2002-2003)
Credit Lyonnais Securities (USA), Equity Research, Telecom Services, Vice President (2000-2001)
Warburg Dillon Read, Equity Research, Telecom Services, Research Associate (1999-2000)
PaineWebber, Equity Research, Steel and Nonferrous Metals, Research Associate, Editor (1995-1999)