Investment Performance Rankings of Major Market Asset Classes

Chart of the Week for August 25-31, 2006

This week’s chart focuses on the performance of the major market indices. As the chart above illustrates, no single asset class dominated the performance spectrum over the last decade.

The top line of the chart, which shows the best-performing asset class for the past nine calendar years and 2006 year to date through July, illustrates this point. So does the bottom line, which shows the worst-performing asset class for the same periods. For instance, the emerging markets asset class was the top-performing class in 1999, 2003, 2005 and year to date through July 2006 but was the worst-performing class in 1995, 1997, 1998, and in 2000.

The year-to-year fluctuations make it practically impossible to predict which asset class will reward investors with high returns. Therefore, investors should diversify among different types of investment options offered in their retirement plan in order to protect their investments against market gyrations.

The above asset classes are representated by the following market indexes: “Cash Equivalents” is represented by 91-day T-Bills; "Fixed Income” is represented by the Lehman Brothers Aggregate Bond Index; “Large Cap” is represented by the Standard & Poor’s 500 Index; “Small Cap” is represented by the Standard & Poor’s Smallcap 600 Index; “International” is represented by the MSCI EAFE Index; "Emerging Markets" is represented by the MSCI Emerging Markets Index.

* This illustration was compiled by information from outside sources which are not affiliated with ICMA-RC. This information is being provided for educational purposes and is not intended to be construed as or relied upon as investment advice. The ICMA-RC does not offer specific tax or legal advice. Individuals are advised to consider any new investment strategies carefully prior to implementing. Past performance does not guarantee future results. Investment returns and principal value will fluctuate, so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data illustrated. For performance data current to the most recent month end, contact ICMA-RC Services, LLC by calling 1-800-669-7400 or by writing to 777 North Capitol Street, NE, Washington, DC 20002-4240, or by visiting www.icmarc.org. Please consult both the current Vantagepoint Funds prospectus and MAKING SOUND INVESTMENT DECISIONS: A Retirement Investment Guide carefully for a complete summary of all fees, expenses, charges, financial highlights and investment objectives, risks and performance information prior to investing any money. Vantagepoint securities are distributed by ICMA-RC Services LLC, a broker dealer affiliate of ICMA-RC, member NASD/SIPC. For a current prospectus, contact ICMA-RC Services LLC, 777 North Capitol Street NE, Washington, DC 20002-4240. 1-800-669-7400. AC:0806-970