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Performance 
 
 
Micro Cap Performance
  Performance Statistics
Small Cap Performance
SMid Cap Performance







  Micro Cap Performance

Micro Cap Growth Equity Historical Performance

Annual Returns Since Inception
[October 1, 1996 - March 31, 2009]
 

SJCM
Gross
SJCM
Net
Russell Micro
Growth
Russell 2000
Growth

S&P 500
2009
Q1

-10.05

-10.24

-8.83

-9.74

-11.01
2008 -54.23 -54.61 -44.65 -38.54 -37.00
2007 5.64 4.84 -2.68 7.05 5.49
2006 16.89 16.00 11.39 13.35 15.79
2005 8.69 7.87 2.05 4.15 4.91
2004 9.66 8.86 7.91 14.31 10.88
2003 97.41 95.99 69.83 48.54 28.68
2002 -8.43 -9.11 -29.02 -30.26 -22.10
2001 -24.34 -23.42 5.31 -9.23 -11.88
2000 26.06 25.12 n/a -22.43 -9.11
1999 137.02 135.37 n/a 43.09 21.04
1998 21.14 20.24 n/a 1.23 28.58
1997 59.02 57.89 n/a 12.95 33.36
1996* 8.82 8.60 n/a 0.26 8.34


Performance Disclosure
Sterling Johnston has prepared and presented this report in compliance with the Global Investment Performance Standards (GIPS).  Each composite, the Sterling Micro cap, Small cap and SMid cap composites have been verified by BDO Seidman since inception.  A copy of the verification report and additional information regarding the firm’s policies and procedures for calculating and reporting performance is available upon request.  A complete list and description of Sterling’s composites is available upon request.

Organization and General
Sterling Johnston Capital Management, L.P. is a Delaware limited partnership, the sole general partner of which is Sterling Johnston Capital Management, Inc., a California corporation (together “SJCM”). Sterling Johnston Capital Management, Inc. was incorporated on April 24, 1985, and registered on July 2, 1985 as an independent adviser with the Securities and Exchange Commission under the Investment Advisers Act of 1940. Pursuant to reorganization on January 1, 2001, Sterling Johnston Capital Management, L.P. succeeded to Sterling Johnston Capital Management, Inc.’s investment adviser registration. The Company was originally incorporated and registered as Sterling Financial Group, Inc. by Mr. Johnston, its founder and owner, and operated as an independent registered investment advisor from July 1, 1985 through December 31, 1992. The corporation was inactive from January 1, 1993 until September 26, 1996, while Scott S. Johnston, its 100% owner, was Chief Investment Officer of another investment advisor, Apodaca Johnston Capital Management. It was re-activated October 1, 1996.

The accompanying schedules conform to the Global Investment Performance Standards (“GIPS”) which utilizes the following criteria:

(a) The calculations are made on a time-weighted basis, cash flows consist principally of contributions, withdrawals and management fees, and are weighted for the amount   of time they impact the calculation.

(b) The rate of return reflects realized and unrealized gains and losses and includes portfolio income (interest and dividends).

(c)  The calculations are weighted for the size of each client’s account as a relationship to the total composite.


(d) 
Rates of return are compiled monthly using the Modified Dietz method, as defined in GIPS. The monthly results are then geometrically linked to derive the quarterly rates of return and the quarterly rates of return are geometrically linked to derive the annual rates of return. Geometric linking is the method used to combine rates of return for multiple periods.

Fair Value
Fair value of the composite is the sum of the Portfolio Accounts’ total assets, including cash, cash equivalents, short-term investments and securities valued at current market prices on a trade date basis.

Leverage, Derivatives & Currency
Leverage has not been used in Portfolio Accounts included in the composite.  Derivatives are not used in Sterling’s Micro, Small or SMid strategy.  The US dollar is used for all valuations.

Annual Dispersion
Composite dispersion measures represent the consistency of the Company’s composite performance results with respect to the individual portfolio returns within the composite. Annual composite dispersion is calculated through the use of an asset weighted standard deviation for portfolios included in the composite for the entire year. Only portfolios that have been managed for the full year are included in the dispersion calculation.  A composite must have more than 5 accounts to measure dispersion. The calculation is an asset weighted standard deviation.

Management Fees
In accordance with GIPS, a comparative presentation before fees provides for the most efficient judgment of manager contribution to client investment returns, and provides performance comparability with similar market indices and with other performance measurement services.  Net of fees, composite returns are reduced by the advisory fee and any applicable incentive fees.

Comparison with Market Indices (Unaudited)
The Russell Micro Cap Growth, Russell 2000 Growth, Russell 2500 Growth and Standard & Poor’s 500 indices are used for comparison purposes to illustrate the investment environment existing during the time periods shown. For comparison purposes, the indices are fully invested (i.e., includes reinvestment of dividends) and have been time-linked in the manner described above for the composite’s rates of return. The rates of return for the indices do not include any transaction costs, management fees or other costs.  Each Sterling composite can invest in equities not included in the respective index.

Future Performance
Past Performance is not indicative of future results. Investment results will vary from time to time depending upon market conditions, the composition of the composite portfolios, and trading expenses, so that any investment results reported should not be considered representative of what an investment may earn in any future period. Investment results will vary among the individual portfolios in the composite. These factors and possible differences in calculation methods should be considered when comparing the composite results with those published by other investment advisors, other investment vehicles and unmanaged indices. Also, the rates of return should be considered relative to the risks associated with the investment objectives of the portfolios in the composite.

micro cap comp

Organization and General
The general investment selection criteria, management style, and market capitalization range of portfolios managed have been consistent throughout the history presented.

Composite Description
The Sterling Johnston Micro Cap Growth Equity composite includes all accounts that are long-only equity and focused on equities typically between $50 million and $1 billion in market capitalization.  The performance inception date for the composite is October 1, 1996.  Accounts eligible to be included in the composite must be fully discretionary and fully invested (cash is less than 10%).

Annual Dispersion
Annual dispersion is not applicable for the periods October 1, 1996 through December 31, 2002, since there was only one portfolio in the composite for the full period.

Management Fees
Management fees are generally 0.75% of assets based on the market value on the last business day of each calendar quarter, but may vary depending on the size of the portfolio.  Performance fees, if taken, are calculated as a percentage of the return in excess of the Russell Micro Cap Growth Index as of the last day of the year. The management and performance fee schedules are set forth in Part II of the firm’s Form ADV, which is available upon request.

*Represents the three-month period from October 1, 1996 to December 31, 1996.

**The Russell Micro Cap Growth Benchmark is applied since 2001 through 2006.  For years prior to 2001 the Russell 2000 Growth is applied.  The Russell Micro cap Growth benchmark was created in 2005 and included return data dating back to 2001.  SJCM converted to the Russell Micro Cap Growth benchmark as its primary benchmark in 2006.               

***Net returns are calculated assuming the standard fee schedule as stated in the ADV part II and are calculated annually.  The standard fee schedule includes a base management fee 0.75% per annum and a performance incentive fee of 20% of the out-performance after management fees above the benchmark per annum.