Click Capital Management, LLC

Report for Third Quarter 2011

The major stock indexes suffered their worst decline since the first quarter of 2009.
Investors were concerned about Europe's ability to deal with its sovereign debt
crisis, and the United States lost its triple-A credit rating. Growth forecasts for the global
economy were cut across the board, stirring fears of a double dip recession. Even gold,
which often moves inversely to the stock market, declined toward the end of the quarter.
The ups and downs led to a very volatile period for the markets, with the Dow moving by
more than 200 points 18 times during the quarter.

While the third quarter is historically the worst of the year, the fourth quarter is the
best. Corporate earnings reports for the third quarter are starting to come in, and are
expected to meet or beat expectations. Long-term investors are using the correction to
accumulate companies with good fundamentals that are trading at a discount. With the
outlook for bonds clouded, dividend-paying stocks are a good alternative, and have a
better chance of keeping up with inflation.

It is difficult to time the market in the short term. The market timer has to be correct
twice, first in deciding when to sell, and then in deciding when to buy again. There are
capital gains taxes incurred on any gains, and the transaction costs of buying and selling.
Unless one is convinced that the 2008-2009 downturn will be repeated, it is preferable to
stay the course, keeping an appropriate asset allocation.

David F. Click
Principal
Click Capital Management
561.747.7077
dfc1947@gmail.com