The Commerce Company | Retirement and Investment Services

Our suggested asset allocations reflect:

With a cautious outlook for the remainder of 2010, we are decreasing equity exposure in four models: 5% moves to fixed income in the Growth and Aggressive portfolios; 3% to cash for the Balanced; 5% to cash for the Moderate. International exposure within equity portfolios are being reduced to the 10-15% range with a bias towards emerging markets.

The economic outlook has weakened since last quarter, as a number of significant headwinds remain in the near term: lingering problems in real estate; tight bank credit; and contractionary fiscal policy at the state and local levels. Additionally, the Gulf oil spill and the European debt crisis are two major developments that are having a negative impact on growth.

We believe U.S. equities are more likely to stagnate over the next 12 months than to rise as earnings growth slows, incomes for higher wage earners are hit with higher federal taxes next year, and consumers continue to suffer from higher costs of credit card debt.

The investment profile is hypothetical, and the asset allocations are presented only as examples and are not intended as investment advice. Asset allocation does not assure a profit or protect against loss. Please contact us if you have questions about these examples and how they relate to your own financial situation. 10-15% of equities should be invested internationally. Please note that international investing involves special risks, including currency fluctuations, differing financial accounting standards,and possible political and economic volatility. These suggestions and asset allocation models may not be suitable for all investors. Consult your financial advisor before making an investment decision.

The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Past performance may not be indicative of future results. The opinions and investment commentary are those of The Commerce Company and not of RJFS or Raymond James. Expressions of opinion are as of this date and are subject to change without notice.

Securities offered through Raymond James Financial Services, Inc. member FINRA/SIPC.