Acknowledgments



Acknowledgements

We would like to thank the following individuals for sharing their knowledge and experiences with the class this semester:

Daniel Anderson

Montecito Bank & Trust

David Liston

Caruso Affiliated Holdings

Richard Schweitzer

Metropolitan West

Portfolio Managers

Brahe, Matthew

Choi, Melissa

Fein, Joshua

Hadden, Megan

Han, Christopher

Just, Lawrence

Kurti, Arseda

Miloyan, Taveen

Moshkovich, Alex

Ohanian, Areg

Pwa, Teguh Hariono

Sahakian, Harout

Tran, Tranh

Portfolio

As of May 1, 2006

|Shares |Company |Price |Market Value |

| | |$64.69 | |

|1,000 |American International Group (AIG) | |$64,650 |

|1,000 |Amgen, Inc. (AMGN) |66.86 |66,860 |

|2,000 |Applied Materials (AMAT) |17.62 |35,240 |

|1,000 |Costco (COST) |54.12 |54,120 |

|1,200 |Dell (DELL) |25.65 |30,780 |

|300 |EBAY Inc. (EBAY) |34.32 |10,296 |

|800 |Fluor Corp. (FLR) |94.36 |8,859 |

|300 |Home Depot (HD) |40.54 |12,162 |

|1,400 |Infosys Technologies (INFY) |78.01 |109,214 |

|500 |International Business Machines (IBM) |82.23 |41,115 |

|900 |Johnson & Johnson (JNJ) |58.59 |52,731 |

|740 |JP Morgan Chase & Co. (JPM) |44.78 |33,137 |

|1,700 |Microsoft Corporation (MSFT) |24.29 |41,293 |

|800 |Nestle Group (NSRGY.PK) |76.35 |61,080 |

|2,000 |The News Corporation (NWS) |18.20 |36,400 |

|1,000 |Pepsico Inc. (PEP) |58.17 |58,170 |

|1,400 |Pfizer (PFE) |25.12 |35,168 |

|1,200 |Philips Electronics (PHG) |33.95 |40,740 |

|750 |Siemens Aktien (SI) |94.34 |70,755 |

|3,400 |Starbucks Corp. (SBUX) |37.25 |126,650 |

|500 |Toyota Motor Corp. (TM) |117.38 |58,690 |

|1,400 |T. Rowe Price & Associates, Inc. (TROW) |81.86 |114,604 |

|1,800 |Univision Comm. Inc (UVN) |35.72 |64,296 |

|1,400 |Waste Management Inc. (WMI) |37.19 |52,066 |

| |Cash | |27,000 |

| | | | |

| | | | |

| | | | |

| |Total | |$ 1,306,077 |

| | | | |

Transactions

Sales:

Transactions occurred on

April 17, 2006 sold 2,000 shares of EMC

April 24, 2006 sold 1,500 shares of GVHR

May 16, 2006 sold 1,200 shares of DELL

May 16, 2006 sold 300 shares of EBAY

May 16, 2006 sold 300 shares of HD

May 16, 2006 sold 300 shares of INFY

May 16, 2006 sold 1,000 shares of SBUX

May 16, 2006 sold 400 shares of TROW

Purchases:

May 16, 2006 purchased 687 shares of BP

May 16, 2006 purchased 327 shares of GS

May 16, 2006 purchased 1,709 shares of SGR

The Stocks

American International Group sells insurance products in the U.S. and internationally. Its four business segments are General Insurance, which offers property and casualty insurance, excess liability, inland marine, environmental, workers compensation, excess and umbrella coverages, aviation, accident and health, equipment breakdown, directors and officers’ liability, difference-in-conditions, kidnap-ransom, export credit and political risk, and various types of professional errors and omissions coverage. Life Insurance & Retirement Services offers individual and group life, payout annuities, fixed and variable annuities, endowment and accident, and health policies. Financial Services engages in financial products and services, including aircraft leasing, capital market transactions, and consumer and insurance premium financing. Real estate mortgages, consumer loans, retail sales finance, and credit-related insurance are its consumer finance products. Asset Management involves investment services and products, including institutional and retail asset management, broker dealer services, and spread-based investment business. AIG has over 2,200 offices in the United States, 8 offices in Canada, and several offices internationally. American International Group was formed in 1967 and is based in New York City.

Amgen, Inc. develops and manufactures human therapeutics based on biotechnology. Its drugs include Epogen/Aranesp for anemia associated with chronic renal failure and chemotherapy; Neupogen/Neulasta to stimulate the immune system in patients undergoing chemotherapy or bone-marrow transplants; and Enbrel for rheumatoid arthritis, psoriasis, and other autoimmune disorders. Amgen is also developing products to treat certain cancers and bone loss (such as osteoporosis). As a biotechnology company, Amgen, Inc. engages in the discovery, development, manufacture, and marketing of human therapeutics based on advances in cellular and molecular biology. It sells its products to healthcare providers, including clinics, hospitals, and pharmacies primarily in the United States, Europe, Canada, and Australia. Amgen has collaboration and license agreement with Memory Pharmaceuticals Corp. to produce drugs for neurological and psychiatric disorders. Amgen is headquartered in Thousand Oaks, California.

Applied Materials, Inc. engages in the development, manufacture, marketing, and service of integrated circuit fabrication equipment for the semiconductor industry worldwide. It offers systems that perform the chip fabrication process, including atomic layer deposition chemical vapor deposition, physical vapor deposition, electrochemical plating, etch, ion implantation, rapid thermal processing, chemical mechanical polishing, wafer wet cleaning, wafer metrology and inspection, and flat panel display manufacturing, as well as systems that etch, measure, and inspect circuit patterns on masks used in the photolithography process. The company’s integrated chips are built on a silicon wafer base and include various circuit components, such as transistors and other devices that are connected by various layers of wiring. It supplies systems for manufacturing copper-based chips, and for depositing, etching, and planarizing the copper interconnect layers. The company’s products are marketed and sold worldwide through a direct sales force. It serves semiconductor wafer manufacturers and integrated circuit manufacturers in Taiwan, North America, Japan, Korea, Europe, and Asia Pacific. Applied Materials was founded in 1967 and is headquartered in Santa Clara, California.

Costco Wholesale Corporation operates membership-only warehouses that sell branded and private-labeled products in a wide range of merchandise categories at low prices.  During fiscal year 2005, Costco operated 433 warehouse clubs, of which 338 are in the United States, 65 are in Canada, 16 are in the United Kingdom, five are in Japan and Korea, and four are in Taiwan.  As the managing partner, Costco operates 27 warehouses in Mexico through a 50%-owned joint venture.  The Company buys nearly all of its merchandise directly from manufacturers for shipment either directly to Costco’s selling warehouses or to a consolidation point, where various shipments are combined to minimize freight and handling costs.

Dell Inc. designs, develops, manufactures, markets, sells and supports a range of customized computer systems and services. These include enterprise systems (servers, storage, networking products, and workstations), client systems (notebooks and desktops), software and peripherals, and service and support programs. Dell also offers a portfolio of services that help maximize information technology (IT). In addition, the Company provides financial services to its business and consumer customers in the United States. Dell markets and sells its products and services directly to its customers who include large corporations, government, healthcare and education accounts, as well as small to medium-sized businesses and individual consumers.

eBay Inc. allows individuals and small businesses to sell their goods through their Internet-based marketplace. Things that are bought and sold on eBay include but not limited to: trading cards, antiques, dolls, housewares, cars, clothing, books, compact disks, and electronics. EBay members can sell, buy, or do both on an automated, arranged service that is online. Paypal is its major online payment services. EBay is available to the U.S. and many other foreign countries.

Fluor Corporation provides services of engineering, procurement, construction, and maintenance in the following five segments in the United States: Oil & Gas – On top of building new facilities, FLR improves and restores old facilities, rebuilds facilities in the result of fire and explosion destruction, and expands for refineries, pipeline, and offshore facility installations for the energy industry. Industrial & Infrastructure – FLR provides its services to the following sectors: manufacturing, life sciences, commercial and institutional, chemicals, mining, microelectronics, telecommunications, and transportation. If clients desire new construction and improvements of old facilities, FLR will lend its architectural, industrial design, engineering, construction, construction management, and commissioning expertise. Government – FLR provides project management services to the department of energy for the U.S. government. Global Services – FLR provides its services of outsourcing industrial fleet, plant turnaround, temporary staffing. Power – Because power industries such as fossil fuel are dependant on power, FLR designs and constructs new power facilities for them.

Home Depot, Inc. is a home improvement retailer. The company stands behind Wal-Mart as the second largest retailer in the US and the third largest in the world. The company has over 2000 stores in North America and operates in countries such as Mexico, Canada and Puerto Rico. Home Depot stores sell a wide assortment of building materials, home improvement and lawn and garden products and provide a number of services. Home Depot stores average about 106,000 square feet of enclosed space, with approximately 22,000 additional square feet in the outside garden area. Home Depot also operated 54 EXPO Design Center stores that sell products and services primarily for home decorating and remodeling projects, 11 Home Depot Landscape Supply stores, five Home Depot Supply stores, and two stores called The Home Depot Floor Store. The Home Depot is the world’s largest home improvement retailer.

Infosys Technologies LTD. (India) is a global technology services company. The Company provides end-to-end business solutions, which leverage technology for its clients, including consulting, design, development and software re-engineering. They provide business process management services, such as offsite customer relationship management, finance and accounting, and administration and sales order processing. With Infosys’ global delivery they also provide software products and coding for the banking industry in North America, Europe and the Asia-Pacific region.

International Business Machines is a worldwide information technology company which operates in the following six segments: Global Services – IBM will lend its consulting services to its clients who are in need for application and systems integration, client relationship management, financial management, human capital, business strategy and change, supply chain management, and transformation of business processes. Systems and Technology Group – includes system and component design services, outsourcing of clients' design teams, technology/manufacturing consulting services, data storage products (disk, tape, and storage area networks), semiconductor technology and products, packaging solutions, and engineering technology. Personal Systems Group – deals with desktop and notebook computers, production print solutions, on demand print-related solutions, enterprise workgroup print technologies, and print management software services. Software – involves with middleware software (which allows its clients to integrate systems, processes, and applications across their enterprises) and operating systems software. It also offers software that handles collaboration and messaging to engage in asynchronous communication, and knowledge management. Global Financing – provides lease and loan (commercial) financing to end users, remarketing, and internal customer financing. Enterprise Investments – IBM develops and provides information technology solutions supporting the hardware, software, and global services segments of the company. Product life cycle management software and document processing technologies are its major product lines.

Johnson & Johnson is engaged in the manufacture and sale of products in the health care field primarily in the United States. Johnson & Johnson has more than 230 operating companies, which manufacture and market thousands of products, all designed to help us lead healthy and happy lives. The companies business operates through three segments: Consumer, Pharmaceutical, and Medical Devices and Diagnostics. The Consumer segment manufactures and markets a range of products used in the baby and child care, skin care, oral and women’s health care fields, as well as over the counter pharmaceutical and nutritional products. The Pharmaceutical segment franchises various products in the anti-fungal, anti-infective, cardiovascular, contraceptive, dermatology, gastrointestinal, hematology, immunology, neurology, oncology, pain management, psychotropic, and urology fields. The Medical devices and Diagnostics segment products used by or under the direction of physicians, nurses, therapist, hospitals, diagnostic laboratories, and clinics.

JPMorgan Chase & Co. operates as a global financial services company in the United States. It operates in six segments: Investment Banking, Retail Financial Services, Card Services, Commercial Banking, Treasury and Securities Services, and Asset and Wealth Management. JP Morgan Chase is headquartered in New York City. With assets of $1.2 trillion, JP Morgan is one of the largest banking institutions in the US. Under the JP Morgan, Chase and Bank One brands, the firm serves millions of consumers in the United States and many of the world's most prominent corporate, institutional and government clients. It operates approximately 2,508 branches in 17 U.S. states and 6,650 automated teller machines. In addition, the company has operations in approximately 50 countries in Europe, Middle East, Africa, Asia-Pacific, Latin America, and the Caribbean. On the last fiscal year, the company reported $80 billion in revenues and $8.4 billion in net income.

Microsoft Corporation develops, manufactures, licenses, and supports a range of software products for various computing devices. The software products include operating systems for servers, personal computers, and intelligent devices; server applications for distributed computing environments; information worker productivity applications; business solutions applications; and software development tools. Microsoft also provides consulting and product support services; and trains and certifies system integrators and developers. Additional products include the Xbox video game console and games, as well as PC games and peripherals. The company’s online businesses include the MSN subscription and the MSN network of Internet products and services. Microsoft also researches and develops advanced technologies. Microsoft also offers music download service in 19 market versions in 17 countries, including 13 western European countries. The company has strategic alliances with Dell, Inc.; KT Corp.; Langchao Group; and MTV Networks, Inc. 

Nestle S.A. is the world’s #1 food company. The Group’s principal activity is the manufacture of different types of baby food, dairy products, nutrition products (cereals, dietetic foods, yogurt, etc.), ice cream, chocolate and confectionery, prepared foods, beverages, food services, bottled water, pharmaceutical products, cosmetics and pet care products. In 2005 the Swiss based company posted record sales and profits.

The News Corp. is a diversified international media and entertainment company with operations in eight industry segments, including filmed entertainment, television, cable network programming, direct broadcast satellite television, magazines and inserts, newspapers, book publishing and other. The Company activities are conducted principally in the United States, Continental Europe, the United Kingdom, Australia, Asia and the Pacific Basin.  News Corporation is a holding company that conducts all of its activities through subsidiaries and affiliates. Some of its major subsidiaries include HarperCollins, Fox Entertainment Group, DIRECTV, Inc., the New York Post, and NDS Group.

PepsiCo Inc., founded through the 1965 merger of the Pepsi-Cola and Frito-Lay companies. The company manufactures, markets, and sells a variety of salty, convenient, sweet and grain-based snacks, carbonated and non-carbonated beverages and foods. The company is organized in four divisions: Frito-Lay North America (32% of revenues in 2005), PepsiCo Beverages North America (28%), PepsiCo International (35%), and Quaker Foods North America (5%). The company distributes its products through direct store delivery, broker warehouse, and food service and vending distribution networks to its customers, including franchise bottlers, distributors, and retailers. PepsiCo is the largest snack company in the world with 2005 revenues of more than $32 billion.

Pfizer, Inc. engages in the discovery, development, manufacture, and marketing of prescription medicines for humans and animals, as well as consumer healthcare products worldwide. It operates in three segments: Human Health, Consumer Healthcare, and Animal Health. In addition, the company offers empty soft-gelatin capsules, contract manufacturing, and bulk pharmaceutical chemicals. It offers its products to health care providers, such as doctors, nurse practitioners, physician assistants, pharmacists, hospitals, Pharmacy Benefit Managers, Managed Care Organizations, and government agencies.

Koninklijke Philips Electronics N.V. is the parent company of the Philips group. The activities of the Philips group are divided into six operating product divisions: Medical Systems, Domestic Appliances and Personal Care, Consumer Electronics, Lighting, Semiconductors and other activities. Philips is the world’s largest lighting maker, a top three hospital maker, and Europe’s biggest consumer electronics producer.

Siemens Aktiengesellschaft operates as an electronics and electrical engineering company worldwide. The Information and Communications segment offers analogue and digital telephones, enterprise solutions, carrier networks, wireless modules, and information technology (IT) environment integration, and IT consulting services. The company’s Automation and Control segment provides products and services in low voltage control and installation technology; automation, motion control, and drive system; and process automation areas. Siemens Power segment offers equipment for converting energy into electricity and heat; and supplies various power-related equipment, systems, and services. The company’s Transportation segment provides products and services for railway transportation. The Medical segment offers diagnostic and therapeutic systems and devices, and information technology systems for clinical and administrative purposes. Siemens Lighting segment offers lighting products for various applications. The Financing and Real Estate segment offers various services, including equipment and sales financing, project and export financing, investment management, and insurance services, and provides real estate development, disposal, lease, and management services.

Starbucks Inc. Starbucks Corporation engages in purchasing, roasting, and

selling whole bean coffees worldwide. The company also sells

brewed coffees, espresso beverages, cold blended beverages, food items, teas, branded coffee drinks, a line of ice creams, and a line of compact discs through its retail stores. In addition, its stores offer pastries, sodas, juices, games, and

seasonal novelty items, as well as coffee-related accessories and equipment, such as  coffee grinders, coffeemakers, coffee filters, storage containers, travel tumblers, and mugs. Starbucks operates retail stores primarily in the United States, Canada, the United Kingdom, Australia, Singapore, and Thailand.  By the end of 2005 Starbucks operated 5,028 stores domestically, 1,188 stores internationally, and over 2,500 licensed locations and joint ventures both domestically and abroad.  Their long term goal is to open up 15,000 domestic stores and 15,000 international stores. The company is headquartered in Seattle, Washington.

Toyota Motor Corporation and its subsidiaries engage in the production of automobiles. The company operates in three segments: Automotive Operations, Financial Service Operations, and Other Operations. The Automotive Operations segment designs, manufactures, assembles, and sells cars, recreational and sport-utility vehicles, minivans and trucks, and related parts and accessories. The Financial Services Operations segment primarily provides finance to dealers and their customers for the purchase or lease of Toyota vehicles. This segment also provides retail financing, retail leasing, wholesale financing and insurance, credit cards, and mortgage loans. Toyota sells its vehicles approximately in 170 countries. It operates in Japan, North America, and Europe. Toyota Motor Corp. was founded in 1933 and is based in Toyota City, Japan.

T. Rowe Price Group Inc. manages assets for individuals through mutual funds and for institutions in separate portfolios. It has a family of more than 80 stock, bond, and money market funds with low expenses. It also offers discount-brokerage and trust services, retirement accounts, and investment-management services. Fund managers are guided by the company's investment philosophy of controlling risk, resulting in relatively stable fund returns. Nearly all of its funds have below-average expenses compared with other funds in the same categories, and portfolio managers are careful about their investments, paying attention to valuation and not betting the farm on any one stock or sector.

Univision Communications Inc. is a Spanish-language media company in the United States. It operates in four business segments: Television, Radio, Music and Internet. The Company's Television segment consists primarily of the Univision, TeleFutura and Galavision television network, the Univision Television Group owned-and-operated broadcast television stations and the TeleFutura Television Group owned-and-operated broadcast television stations. Univision Radio, which operates in the Company's Radio segment, is a Spanish-language radio broadcasting company in the United States. The Company's Music segment consists of its music recording and music publishing business, which includes the Univision Records label, Fonovisa Records and an ownership interest in Disa Records. In the Internet segment, Univision Online, Inc. operates the Company's Internet portal, which provides Spanish-language content directed at Hispanics in the United States, Mexico, and Latin America. The company has been steadily gaining market share in the Hispanic segment of the population and it is the 5th most-watched TV network in the US (including English-speaking). Univision put itself for sale in early 2006, and is currently receiving interest from Mexico’s Televisa media company.

Waste Management, Inc (WMI) provides waste and environmental services in North America. The company provides collection, transfer, recycling and resource recovery, disposal, and landfill services. Waste Management also develops, operates, and owns waste-to-energy facilities in the United States. WMI also rents and services portable restroom facilities to cities and commercial customers; and provides street and parking lot sweeping services. WMI’s customers include commercial, industrial, municipal, and residential customers; other waste management companies; electric utilities; and governmental entities. The Company manages and evaluates its operations through seven operating Groups, five of which are organized by geographic area (Eastern, Midwest, Southern, Western and Canadian Groups) and two of which are organized by function (Recycling and Wheelabrator Groups).

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