MSCI EAFE Index

An index designed to provide access to developed markets outside the United States

The MSCI EAFE Index is a widely recognized international equities index of large companies across developed countries in Europe, Australasia and the Far East, excluding the U.S. and Canada. The MSCI EAFE Index includes equities across a range of industries and regions, providing broad opportunities for growth.

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An international approach

Equities from the United Kingdom, Japan, France and Germany account for more than 60% of the Index. Individual companies represented include Nestle, Toyota Motor Corp and Bayer — companies with a strong historical track record of positive returns. The MSCI EAFE Index includes ten market sectors including financials, health care and energy.

MSCI EAFE Index
MSCI EAFE Index

The international market growth opportunity

The United States represents only 41% of the total global stock market.2 The remaining 59% of the world’s equities are traded on markets in Paris, London, Berlin, Singapore and beyond. In an increasingly global economy, international markets provide substantial growth opportunities. In fact, the World Bank forecasts world economic growth to exceed the growth in the United States in each of the next three years.3

A wide-reaching international equities index

MSCI EAFE is the oldest international equities index and includes a selection of stocks from 21 countries. MSCI EAFE selects stocks from developed markets providing the opportunity to participate in returns from international companies while limiting exposure to emerging markets.4 The MSCI EAFE is reviewed quarterly to reflect changes in the international equities market.5

MSCI EAFE Index

MSCI EAFA developed markets countries
Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, United Kingdom7

For more information about MSCI EAFE, please visit www.msci.com/eafe

MSCI EAFE Index

Chart assumptions: Index growth from 12/31/2005 – 12/31/2015. Calendar year-end returns are the percentage change between the closing price on December 31 of the year noted and December 31 of the prior year. Past performance is not an indicator of or guarantee of future performance.

Last 10 years of MSCI EAFE Index performance

MSCI EAFE provides an international equities opportunity with nearly 30 years of live history. Domestic indices such as the S&P 500® Index exclude international equities markets and a majority of the world’s equities. The table below illustrates how the MSCI EAFE price index and the S&P 500® price index have performed over the last 10 years.

With the international economy projected to outperform the United States over the next several years, MSCI EAFE may capture a portion of that growth and provide an opportunity to harness that potential.3

1 Source: MSCI. MSCI EAFE is one of MSCI’s oldest indices, dating back to 1969. MSCI EAFE’s long history makes it one of the most popular benchmarks of international equities.

2 Source: World Bank, Global Economic Prospects, 2016.

3 Source: World Bank, Global Economic Prospects, 2016. The MSCI EAFE Index is designed to represent the performance of large and mid-cap securities across 21 developed markets excluding the U.S. and Canada. A portion of the world GDP could include emerging markets, which are countries in the process of rapid development with less mature markets and regulations, as well as the developed markets tracked by the MSCI EAFE Index.

4 Limiting exposure to emerging markets may reduce potential volatility but may also reduce potential short-term returns of emerging markets countries experiencing rapid growth.

5 Semi-annual index reviews in May and November rebalance the index and establish the large and mid capitalization cutoffs.

6 Source: MSCI Indexes

7 As of August 31, 2016. Developed markets are advanced economies with strong institutions and high levels of per capita income.

Fixed indexed annuities are not an investment and do not directly participate in the stock market or any index. International investing could involve risk such as currency, economic, geographical, political and differences in accounting standards. The MSCI EAFE Index is unmanaged and cannot be invested into directly, and past performance is not indicative of future results.

Neither Nationwide nor any of its affiliates are affiliated with MSCI Inc. or its affiliates.

This product is not sponsored, endorsed, sold or promoted by MSCI Inc. (“MSCI”), any of its affiliates, any of its information providers or any other third party involved in, or related to, compiling, computing or creating any MSCI index (collectively, the “MSCI Parties”). The MSCI indexes are the exclusive property of MSCI. MMSCI and the MSCI Index names are service mark(s) of MSCI or its affiliates and have been licensed for use for certain purposes by nationwide. None of the MSCI Parties makes any representation or warranty, express or implied, to the issuer or owners of this product or any other person or entity regarding the advisability of investing in products generally or in this product particularly or the ability of any MSCI Index to track corresponding stock market performance. MSCI or its affiliates are the licensors of certain trademarks, service marks and trade names and of the MSCI Indexes which are determined, composed and calculated by MSCII without regard to this product or the issuer or owners of this product or any other person or entity. None of the MSCI Parties has any obligation to take the needs of the issuer or owners of this product or any other person or entity into consideration in determining, composing or calculating the MSCI Indexes. None of the MSCI Parties is responsible for or has participated in the determination of the timing of, prices at, or quantities of this product to be issued or in the determination or calculation of the equation by or the consideration into which this product is redeemable. Further, none of the MSCI Parties has any obligation or liability to the issuer or owners of this product or any other person or entity in connection with the administration, marketing or offering of this fund.

Although MSCI shall obtain information for inclusion in or for use in the calculation of the MSCI Indexes from sources that MSCI considers reliable, none of the MSCI Parties warrants or guarantees the originality, accuracy and/or the completeness of any MSCI Index or any data included therein. None of the MSCI Parties makes any warranty, express or implied, as to results to be obtained by the issuer of the product, owners of the fund, or any other person or entity, from the use of any MSCI Index or any data included therein. None of the MSCI Parties shall have any liability for any errors, omissions or interruptions of or in connection with any MSCI Index or any data included therein. Further, none of the MSCI Parties makes any express or implied warranties of any kind, and the MSCI Parties hereby expressly disclaim all warranties of merchantability and fitness for a particular purpose, with respect to each MSCI Index and any data included therein. Without limiting any of the foregoing, in no event shall any of the MSCI Parties have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages.