Glossary

Energy security is the uninterrupted availability of energy sources at an affordable price.

Inflation is the rate at which prices for goods and services rise.

Risk assets those with a high degree of risk and volatility, such as such as equities, high-yield credit, commodities, and currencies.

Alpha measures the difference between a portfolio’s actual return and its expected return given its risk level as measured by its beta.

Beta measures the historical market risk of a portfolio or the volatility of a portfolio relative to an underlying index over a defined historical period of time.

Growth-oriented refers to areas of the market more likely to realize high earnings growth in the future and likely trade at a higher price relative to their earnings than the broader market.

Value-oriented refers to areas of the market less likely to realize earnings high growth in the future and likely trade at a lower price relative to their earnings than the broader market.

The “right side of disruption” refers to companies that in our view are aligned with key secular growth trends and/or are creating new innovative solutions.

Green economy refers to investments leading the climate transition.

Equity risk premia refer to the excess return earned by an investor when they invest in the stock market over a risk-free rate.

TINA stands for There Is No Alternative.

TARA stand for There Are Reasonable Alternatives.

Speculative-grade fixed income refers to high yield fixed income.

Duration measures the sensitivity of the price of a fixed income investment to a change in interest rates.

Short duration refers to a bond with a small amount of time to maturity.

Treasuries refers to US Treasury debt obligations.

Inflation-adjusted yields refer to the measure of return that takes into account the time period's inflation rate.

Innovation-oriented equities refer to companies that offer innovative solutions and are in line with long-term secular growth trends, such as technological innovation, environmental sustainability, future health care, and the new-age consumer.

Liquid alternatives are alternative mutual funds that often have characteristics similar to hedge funds but are public vehicles that can be traded easily.

Green bonds are fixed income investments with proceeds used to finance projects with dedicated environmental impact

GDP stands for gross domestic product and refers to the value of finished goods and services produced within a country's borders over one year.

Median return is the middle return in a sorted list of each individual security's return.

Risk premia refer to the amount by which the return of a risky asset is expected to outperform the known return on a risk-free asset.

Leverage ratio is a financial measurement that assesses the ability of a company to meet its financial obligations.

Interest coverage ratio is a measurement used to determine how easily a company can pay interest on its outstanding debt.

Drawdown is a peak-to-trough decline during a specific period for an investment, trading account, or fund.

Low quality companies would rank low based on low return on equity (LOE), high leverage or debt to equity, and unstable earnings.

German 10Y is a bond that reflects the yield received on government bonds issued by the German government maturing in 10 years.

Spain 10Y is a bond that reflects the yield received on government bonds issued by the Spanish government maturing in 10 years.

US 10Y Treasury is a bond that reflects the yield received on government bonds issued by the United States government maturing in 10 years.

United Kingdom 10Y is a bond that reflects the yield received on government bonds issued by the UK government maturing in 10 years.

Italy 10Y reflects the yield received on government bonds issued by the Italian government maturing in 10 years.

US 2Y Treasury is a bond that reflects the yield received on government bonds issued by the United States government maturing in 10 years.

ICE BofA US High Yield Index value, which tracks the performance of US dollar denominated below investment grade rated corporate debt publicly issued in the US domestic market.

ICE BofA Euro Corporate Index value, which tracks the performance of Euro dollar denominated investment grade rated corporate debt.

ICE BofA High Yield Master II OAS uses an index of bonds that are below investment grade (those rated BB or below).

EMBI (Emerging Market Bond Index) is JP Morgan's index of dollar-denominated sovereign bonds issued by a selection of emerging market countries. The Global Diversified limits the weights of countries with larger debt stocks by only including a specified portion of these countries' eligible current face amounts of debt outstanding.

ICE BofA US Corporate Index, which tracks the performance of US dollar denominated investment grade rated corporate debt publicly issued in the US domestic market.

Risk Considerations

All investing is subject to risk, including the possible loss of the money you invest.

Equity securities are more volatile than bonds and subject to greater risks. Dividends are not guaranteed and a company’s future ability to pay dividends may be limited.

Bonds are subject to interest rate, price and credit risks. Prices tend to be inversely affected by changes in interest rates. Typically, when interest rates rise, there is a corresponding decline in the market value of bonds.

Investments in fixed income securities are subject to the risks associated with debt securities including credit and interest rate risk.

Investments in foreign securities entail special risks such as currency, political, economic, and market risks. These risks are heightened in emerging markets.

Investments in commodities may be affected by changes in overall market movements, commodity index volatility, changes in interest rates or factors affecting a particular industry or commodity.

High-yield, lower-rated securities involve greater price volatility and present greater credit risks than higher-rated fixed income securities.

Private equity investments are speculative, highly illiquid, involve a high degree of risk, have high fees and expenses that could reduce returns, and subject to the possibility of partial or total loss of fund capital; they are, therefore, intended for experienced and sophisticated long-term investors who can accept such risks.

Alternative Investments often engage in leverage and other investment practices that are extremely speculative and involve a high degree of risk. Such practices may increase the volatility of performance and the risk of investment loss, including the loss of the entire amount that is invested. There may be conflicts of interest relating to the Alternative Investment and its service providers, including Goldman Sachs and its affiliates. Similarly, interests in an Alternative Investment are highly illiquid and generally are not transferable without the consent of the sponsor, and applicable securities and tax laws will limit transfers.

An investment in real estate securities is subject to greater price volatility and the special risks associated with direct ownership of real estate.

Hedge funds and other private investment funds (collectively, “Alternative Investments”) are subject to less regulation than other types of pooled investment vehicles such as mutual funds. Alternative Investments may impose significant fees, including incentive fees that are based upon a percentage of the realized and unrealized gains and an individual’s net returns may differ significantly from actual returns. Such fees may offset all or a significant portion of such Alternative Investment’s trading profits. Alternative Investments are not required to provide periodic pricing or valuation information. Investors may have limited rights with respect to their investments, including limited voting rights and participation in the management of such Alternative Investments.

The above are not an exhaustive list of potential risks. There may be additional risks that should be considered before any investment decision.

General Disclosures

The views expressed herein are as January 17, 2023 and subject to change in the future. Individual portfolio management teams for Goldman Sachs Asset Management may have views and opinions and/or make investment decisions that, in certain instances, may not always be consistent with the views and opinions expressed herein.

THIS MATERIAL DOES NOT CONSTITUTE AN OFFER OR SOLICITATION IN ANY JURISDICTION WHERE OR TO ANY PERSON TO WHOM IT WOULD BE UNAUTHORIZED OR UNLAWFUL TO DO SO.

This material is provided for informational purposes only and should not be construed as investment advice or an offer or solicitation to buy or sell securities. This material is not intended to be used as a general guide to investing, or as a source of any specific investment recommendations, and makes no implied or express recommendations concerning the manner in which any client’s account should or would be handled, as appropriate investment strategies depend upon the client’s investment objectives.

Prospective investors should inform themselves as to any applicable legal requirements and taxation and exchange control regulations in the countries of their citizenship, residence or domicile which might be relevant.

This information discusses general market activity, industry or sector trends, or other broad-based economic, market or political conditions and should not be construed as research or investment advice. This material has been prepared by Goldman Sachs Asset Management and is not financial research nor a product of Goldman Sachs Global Investment Research (GIR). It was not prepared in compliance with applicable provisions of law designed to promote the independence of financial analysis and is not subject to a prohibition on trading following the distribution of financial research. The views and opinions expressed may differ from those of Goldman Sachs Global Investment Research or other departments or divisions of Goldman Sachs and its affiliates. Investors are urged to consult with their financial advisors before buying or selling any securities. This information may not be current and Goldman Sachs Asset Management has no obligation to provide any updates or changes.

Although certain information has been obtained from sources believed to be reliable, we do not guarantee its accuracy, completeness or fairness. We have relied upon and assumed without independent verification, the accuracy and completeness of all information available from public sources.

Any reference to a specific company or security does not constitute a recommendation to buy, sell, hold or directly invest in the company or its securities. It should not be assumed that investment decisions made in the future will be profitable or will equal the performance of the securities discussed in this document.

Economic and market forecasts presented herein reflect a series of assumptions and judgments as of the date of this presentation and are subject to change without notice. These forecasts do not take into account the specific investment objectives, restrictions, tax and financial situation or other needs of any specific client. Actual data will vary and may not be reflected here. These forecasts are subject to high levels of uncertainty that may affect actual performance. Accordingly, these forecasts should be viewed as merely representative of a broad range of possible outcomes. These forecasts are estimated, based on assumptions, and are subject to significant revision and may change materially as economic and market conditions change. Goldman Sachs has no obligation to provide updates or changes to these forecasts. Case studies and examples are for illustrative purposes only.

Past performance does not guarantee future results, which may vary. The value of investments and the income derived from investments will fluctuate and can go down as well as up. A loss of principal may occur.

References to indices, benchmarks or other measures of relative market performance over a specified period of time are provided for your information only and do not imply that the portfolio will achieve similar results. The index composition may not reflect the manner in which a portfolio is constructed. While an adviser seeks to design a portfolio which reflects appropriate risk and return features, portfolio characteristics may deviate from those of the benchmark.

Index Benchmarks Indices are unmanaged. The figures for the index reflect the reinvestment of all income or dividends, as applicable, but do not reflect the deduction of any fees or expenses which would reduce returns. Investors cannot invest directly in indices.

The Global Industry Classification Standard (“GICS”) was developed by and is the exclusive property and a service mark of MSCI Inc. (“MSCI”) and S&P Global Market Intelligence (“S&P”) and is licensed for use by Goldman Sachs. Neither MSCI, S&P, nor any other party involved in making or compiling the GICS or any GICS classifications makes any express or implied warranties or representations with respect to such standard or classification (or the results to be obtained by the use thereof), and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability and fitness for a particular purpose with respect to any of such standard or classification. Without limiting any of the foregoing, in no event shall MSCI, S&P, any of their affiliates or any third party involved in making or compiling the GICS or any GICS classifications 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.

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Date of First Use: January 19, 2023 303206-OTU-1729696