Thematic Investing Capitalizing on Tomorrow’s Trends Today

> Our thematic portfolios seek to identify and exploit powerful themes that may drive profits across industries. > Our current themes target opportunities associated with major trends like climate change, high-speed Internet and genomic medicine. > may provide an attractive diversification element to an overall portfolio, potentially Products Offered enhancing returns while reducing overall portfolio risk. • Are Not FDIC Insured • May Lose Value • Are Not Guaranteed

Thematic Investing 1

Big Changes May Lead to Big Opportunities

Portfolios built on innovative ideas that can transform the investing landscape allow to participate in some of the world’s most promising .

Searching the Horizon for Promising Themes Research Leads Us to Opportunity We’re living in a period of extraordinary change. Identifying the right themes isn’t easy. The High-speed Internet access has spread like wildfire investment world is full of promising ideas that across the globe, altering the way we spend our go nowhere. It takes teams of analysts with deep time—at work and at play. Many believe rising expertise in a variety of industries to see through temperatures are threatening our very future on this the hype. We’ve spent two decades building one planet—and inspiring people around the world to of the largest research efforts in the investment “think green.” Revolutionary discoveries in genetics world—and we believe this helps us build will soon allow us to diagnose and treat many of the thematic portfolios that include companies of diseases that afflict us, prolonging our lives. unusual promise. Disruptive ideas, innovations and economic forces In this brochure, we’ll discuss how we approach like these are constantly reshaping our world. We thematic investing and how the themes that drive believe the companies that can exploit them will our investments will reshape our world and create become the next great investment opportunities. the potential for major opportunities for investors. Thematic investing uses these ideas as a guide to help build portfolios of companies with unusual promise, positioned to capitalize on exciting A thematic approach can help identify long-term trends. companies poised to exploit the bold new ideas of tomorrow. 2 AllianceBernstein

Research Drives Our Investment Themes

Our thematic research team tries to identify and exploit profound economic or technological changes that are powerful enough to drive profits across many different industries.

Leveraging Research Insights from Across Our Firm Targeting the Right Companies To find the themes that will drive tomorrow’s But simply identifying these transformational markets, we draw heavily on our firm’s research themes and their impact is only part of the story: strength. Analysts from our Research on Strategic we must also identify companies that will reap Change group help us identify and define long- the benefits. To do so, we focus on the strategic term themes like climate change and genomic advantages of a company’s business plan over our medicine. The themes we choose to invest in three- to five-year investment time horizon. must be powerful enough to create and disrupt Our Early Stage Growth team helps us target business opportunities. innovations on the cusp of being commercially To target the industries most likely to benefit from viable, and our growth and value analysts give us each theme, we build a profound understanding of deep insight into company fundamentals. all the underlying market dynamics. For example, We refine our portfolio selections with the help of after studying the economics of producing solar our economic analysts, who identify the cyclical energy, we concluded that investors should focus less forces that may affect our themes in the next 12 to on renewable energy such as wind and solar, 18 months. In addition, we constantly balance the and more on nuclear power, plug-in hybrids and risk/reward trade-offs of the stocks held in our clean coal technologies. portfolios with tools developed by our quantitative research group.

Our thematic investment process draws on the best ideas of our research analysts.

Research on Strategic Change Identifies key secular themes and beneficiaries Early Stage Growth Research Quantitative Research Identifies emerging technologies Analyzes portfolio risk/reward ratio ´ Thematic Research Economic Research ´ Team ´ Fundamental Research Provides global cyclical outlook ´ ´ Identifies attractive investment candidates ´ Portfolio Themes > Climate Change > (re)Emerging Middle Class > Web 2.0 > Heightened Cyclicality > Genomic Age

Portfolio themes are subject to change. Source: AllianceBernstein Thematic Investing 3

Capitalizing on Tomorrow’s Trends Today

Here are five key themes that we currently believe will transform industries and create enormous opportunities for our clients.

A Changing Climate Will Inspire Massive New emissions, will be retooled so that they channel Investment Around the World their emissions underground. Efforts that promote The threat of catastrophic changes in the world’s energy efficiency, nuclear energy and plug-in climate is leading people around the world to hybrids will also help.

“think green.” Support continues to grow for The capital expenditures needed to push CO2 strong regulatory efforts to reduce greenhouse concentrations below dangerous levels will be

gas emissions like CO2. This concerted effort by massive and will likely occur over decades. governments, corporations and global movement We believe that the investment implications will should lead to strict new policies and may alter be profound for a wide variety of industries—from the way businesses operate. Much of the world electric utilities and power equipment makers has already adopted regulations with this goal in to pipeline operators and construction & mind, and we expect them to become stricter and engineering firms. more widespread. This redefined regulatory regime will promote existing and developing technologies, allowing us New expenditures to control climate change to control carbon emissions in many new ways. have profound investment implications. Electric power plants, the largest source of these

A new generation of global power plants will use clean coal, nuclear and renewable energy.

Capital Expenditures of Global Power Generation USD Billions

600 Traditional Coal Plants Gas 400 Oil Renewables

Nuclear 200 Clean Coal

0 2006 2010E 2014E 2018E 2022E 2026E 2030E

Neither current analysis nor estimates nor performance guarantees future results. Source: Energy Information Association, International Energy Agency, Oak Ridge National Laboratory, World Resources Institute and AllianceBernstein 4 AllianceBernstein

Innovative Companies Have Prospered as the One of the most important trends is the rise of World Goes Online the “cloud computing” model which allows users High-speed networks have made enormous strides to access powerful programs and computing in the first decade of the 21st century. Just 15 infrastructure via web browsers—without using years ago, few people had Internet access in their software or storage on their local computers. It homes; these days, many of us carry it with us on simplifies technology for computer users because our cell phones. The developed world’s thirst for software and data is stored on servers elsewhere on high-speed Internet access is now spreading to the the Internet “cloud.” Leveraging these “clouds” emerging markets. Some of the companies that creates new business concepts like “software- helped build the infrastructure for this revolution as-a-service” allowing enterprise companies to are facing slower growth, but other companies turn capital technology expenditures into more are poised to take advantage of the new ability to predictable operating expenses. We believe cloud connect to the information superhighway almost computing will lead to many new investment anytime—and anywhere. opportunities as it gains traction and takes market from traditional IT technologies. Consumers are spending more time online, and as they expand their Internet use to bandwidth-intensive The efficiencies of global networks are encouraging activities like streaming video such as YouTube and companies to divest themselves of non-core high-definition TV, demand for additional capacity businesses and outsource to firms that can produce will grow dramatically. We believe this will create goods and services at lower cost. attractive investment opportunities in companies that support, organize and secure data. We believe the evolution of consumers’ online preferences will also Promising new companies are learning include a surge in multi-player games, online virtual how to exploit the global increase in worlds and other new forms of entertainment, which are already attracting new users by the millions. Some broadband capacity. innovative new companies in this sector have learned how to capitalize on a variety of trends enabled by high-speed internet access.

Mobile internet is ramping up faster than desktop internet and we believe more users will connect to internet via mobiles than PCs within 5 years.

Computing Growth Drivers Over Time 1960–2020E

More than Just Phones 1,000,000 Mobile Internet Smartphone 10 Bil.+ Units Estimated Kindle 100,000 iPad Desktop Internet 10,000 1 Bil.+ Units/Users Cell phone/PDA Car Electronics GPS, ABS, A/V 1000 PC Mobile Video 100 Mil.+ Units Home Entertainment 100 Minicomputer Games 10 Mil.+ Units Wireless Home Appliances 10 Mainframe

Devices/Users (Mil. in Log Scale) Devices/Users (Mil. 1 Mil.+ Units Increasing Integration 1

0 1960 1970 1980 1990 2000 2010 2020 Historical analysis and current estimates do not guarantee future results. Note: PC installed base reached 100MM in 1993, cellphone/Internet users reached 1B in 2002/2005 Source: ITU, Mark Lipacis, Morgan Stanley Research and AllianceBernstein Thematic Investing 5

A Promising New Age of Genomic Medicine Is These exciting developments will help us live About to Begin longer, more productive lives. They will also Technological advances often lead to scientific transform the way medicine is practiced and open discoveries that change how we treat illnesses, up vast new opportunities in the healthcare and creating breakthrough investment opportunities. industries. We’re now identifying which Improvements in microscopes during the companies we believe are positioned to thrive 1850s helped us understand how bacteria cause in this new era of medicine—and which may be many infectious diseases, leading to vaccines left behind. and improvements in hygiene. In the 1940s, We believe many of these companies are going our ability to manipulate chemistry fueled the unnoticed and being undervalued. Few investment development of antibiotics and the birth of the organizations have dedicated sufficient resources pharmaceutical industry. to deeply understand the investment implications, Science is now crossing a new medical milestone and many sophisticated investors are still skeptical with the mapping of the human genome—the of the biotech industry. As a result, relatively basic genetic information contained in our DNA. few understand the major developments that this As methods for decoding this map become faster science will soon bring to the health care industry and the tools utilized become cheaper, companies and beyond. will be able to develop tests and medicines tailored to our specific needs. Doctors hope to eventually be able to predict the diseases that New genetic therapies will redefine how will affect us and prescribe medical treatments we practice medicine and open up vast for some of our most challenging illnesses—from heart disease to cancer. new opportunities.

Knowledge of the genetic origins of disease is increasing at an exponential rate.

Cumulative Genomic Associations with Human Disease

800 Age-related macular degeneration Crohn's disease AIDS progression Cystic fibrosis severity 600 Asthma Cholesterol Attention deficit hyperactivity Heart Related Illness 400 disorder Height Mental Illness Multiple sclerosis Body mass index Parkinson's disease 200 Cancer (Breast, Prostate, Diabetes and Pancreatic) 0 2005 2006 2007 2008 2009

Current analysis does not guarantee future results. As of December 31, 2009 Source: National Human Genome Research Institute, US Congressional Reports and AllianceBernstein 6 AllianceBernstein

A Powerful Middle Class Is Growing Stimulus Efforts Have Led Us to a Reshaped Around the World Environment of Cyclical Opportunities The rapid growth of emerging economies—partic- We believe the massive stimulus efforts in progress ularly in China and elsewhere in Asia—has given will help revive the global economy. But we birth to a new and rapidly growing middle class. also believe they may lead to a more volatile These consumers are spending more on business cycle. discretionary items such as personal luxuries, To combat potential inflation, governments will be name-brand products and entertainment. Firms forced to take drastic measures to remove the excess selling products in these surging markets are liquidity from the system. As a result, we may see moving production centers closer in an effort a return to the shorter and sharper economic cycles to reduce manufacturing costs—and have been of the 1970s and early 1980s, which were driven reaping sizable profits. largely by monetary and fiscal policy. The ranks of the middle class are growing This intensely cyclical environment is likely to lead in the developed markets as well. Economic to many new investment opportunities. Companies changes and new policy decisions are helping to with strong balance sheets should be able to capture change consumer spending patterns and opening market share from weaker rivals, becoming more up additional new investment opportunities, efficient. At the same time, active managers may particularly in Europe and the Americas. have the opportunity to capitalize on companies arising from the various economic scenarios that may occur.

When per-capita GDP reaches $6,000, consumption Dramatic growth in the could lead to growth in emerging markets has historically taken off. higher inflation.

Consumer Contribution to GDP* Growth of Monetary Base Year over Year Percent 90 $6,000 120 80 100 Periods of 70 80 60 Infrastructure buildout Rise in Consumption 60 50 40 40 20 30 0 $0 10 20 30 40 50 –20 1930 1940 1950 1960 1970 1980 1990 2000 2010 India China Global Trend (1955–now) Historical analysis does not guarantee future results. Through December 31, 2009 Historical analysis does not guarantee future results. Source: Bloomberg, FactSet and AllianceBernstein As of December 31, 2009 *Consumption % GDP vs. per-capita GDP in USD purchasing power of parity terms Source: Nomura and AllianceBernstein estimates Thematic Investing 7

Change Is Constant; Opportunities Aren’t

Big investment themes are never static: they continue to evolve as the world changes. Our portfolios are designed to adapt to these changes.

Building portfolios on the basis of promising Sometimes themes that begin as separate ideas investment themes forces us to keep watch on converge. Other times, themes need to be redefined how new events are affecting our investments. to capture the new directions they’re taking. Our interest in opportunities associated with the We also adjust the portfolio weightings we assign Internet is a good example. Our initial efforts to each theme depending on the investment targeted manufacturers of high-speed Internet opportunities we see. technology, but as more people started using it to watch streaming video, play games and interact online in new ways, we changed our focus to follow We try to identify the most dynamic companies that can exploit these new trends. economic and technological trends and then find companies poised to benefit from them.

Our investment themes evolve over time.

Cyclical/Other Broadband Revolution/ Cyclical/Other Broadband Revolution/ Broadband Revolution/ Personalized Media* Cyclical/Other Heightened Cyclicality Personalized Media* Personalized Media* Abating Climate Change Developing World’s Broadband Revolution/ Web 2.0 Emerging Middle Class† Abating Climate Change Personalized Media* Developing World’s Emerging Middle Class† Biotech Revolution/ Developing World’s † Developing World’s Personalized Medicine‡ Emerging Middle Class Emerging Middle Class† Abating Climate Abating Climate Biotech Revolution/ Change

Weighting ‡ Change Productivity Super Cycle/ Personalized Medicine Biotech Revolution/ Deverticalization* Personalized Medicine‡ Biotech Revolution/ Developing World’s Personalized Medicine‡ Emerging Middle Class† Productivity Super Cycle/ (re)Emerging Productivity Super Cycle/ Productivity Super Cycle/ Biotech Revolution/ Middle Class Deverticalization* ‡ Deverticalization* Deverticalization* Personalized Medicine Industrial Renaissance Productivity Super Cycle/ Rise of Electronic Rise of Electronic Deverticalization* Financial Exchanges* Genomic Age Industrial Renaissance Financial Exchanges* Genomic Age Housing

Investment themes and weights are subject to change. As of December 31, 2009 * Now part of Web 2.0 † Now part of (re)Emerging Middle Class ‡ Now part of Genomic Age Source: AllianceBernstein 8 AllianceBernstein

Unique Insights Lead to Diversified Portfolios

Unique insights from our global team of research analysts allow investors to diversify their global portfolio, potentially enhancing returns while reducing risk.

Drawing on Our Research Strength Diverse Investment Platforms AllianceBernstein’s approach to thematic investing We’ve designed our thematic investment portfolios is supported by more than 160 fundamental and to help investors build and preserve their wealth. To quantitative analysts from across the firm. Our do this effectively, we offer a variety of investment analysts, who have an average of 14 years of platforms to suit individual needs: investment experience, have the deep insights > Mutual Funds required to understand and challenge the market’s > Separately Managed Accounts view of a company. > Subadvisory Services Our thematic research often leads us to unique insights—and as a result, our thematic portfolios > Education Strategies don’t look or perform like others. They span sector > Services and country borders with no regard for industry- To find out more about AllianceBernstein’s defined style. Thematic companies may behave like offerings, contact your financial advisor. growth stocks during one phase and value stocks in another. Because thematic portfolios aren’t highly correlated with style or index-sensitive holdings, they can help diversify an overall portfolio, enhance Thematic portfolios may be a good return potential and reduce overall risk. complement to traditional style- and benchmark-driven investments.

Diversification does not eliminate the risk of loss.

A Word About Risk Note to Canadian Readers: Market Risk: The market values of the portfolio’s holdings rise and fall AllianceBernstein provides its services in from day to day, so investments may lose value. Canada through its affi liates Sanford C. Bernstein & Co., LLC and AllianceBernstein Canada, Inc. Foreign (Non-US) Risk: Investing in non-US securities may be more volatile because of political, regulatory, market and economic AllianceBernstein Investments, Inc. (ABI) is the distributor of the uncertainties associated with such securities. These risks are magnifi ed AllianceBernstein family of mutual funds. ABI is a member of FINRA and is an in securities of emerging or developing markets. affi liate of AllianceBernstein L.P., the manager of the funds. ® Currency Risk: If a non-US ’s trading currency weakens versus AllianceBernstein and the AB logo are registered trademarks and service the US dollar, its value may be negatively affected when translated back marks used by permission of the owner, AllianceBernstein L.P. into US dollar terms. © 2010 AllianceBernstein L.P. Derivatives Risk: Investing in instruments such as options, futures, forwards or swaps can be riskier than , and may be more volatile, especially in a down market. There is no guarantee that any forecasts or opinions in this material will be realized. Information should not be construed as investment advice.

Investors should consider the investment objectives, risks, charges and expenses of the Fund/Portfolio carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.alliancebernstein.com or contact your AllianceBernstein Investments representative. Please read the prospectus and/or summary prospectus carefully before investing.

To learn more about the benefi ts of AllianceBernstein’s Thematic Investments, contact your fi nancial advisor.

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