UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-5038
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Clearwater Investment Trust
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(Exact name of registrant as specified in charter)
2000 Wells Fargo Place, 30 East 7th Street, Saint Paul, Minnesota 55101-4930
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(Address of principal executive offices) (Zip code)
Susanne S. Smith
Chief Compliance Officer
Fiduciary Counselling, Inc.
2000 Wells Fargo Place, 30 East 7th Street
Saint Paul, Minnesota 55101-4930
(Name and address of agent for service)
Copy to:
Steven G. Lentz
Faegre & Benson LLP
90 South Seventh Street
2200 Wells Fargo Center
Minneapolis, Minnesota 55402
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(Name and address for agent for service)
Registrant's telephone number, including area code:
651-228-0935
Date of fiscal year end: December 31, 2008
Date of reporting period: December 31, 2008
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
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burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. Section 3507.
CLEARWATER INVESTMENT TRUST
Financial Statements
December 31, 2008
(With Report of Independent Registered Public Accounting Firm Thereon)
Letter to our shareholders (unaudited)
February 2009
On December 31, 2008, the net asset value of the Clearwater Growth Fund was
$18.60 per unit. The net asset value of the Clearwater Small Cap Fund was $10.39
per unit. On a total return basis for 2008, the Clearwater Growth Fund decreased
by -37.5% versus the Russell 1000 decrease of -37.6%, while the Clearwater Small
Cap Fund decreased by -37.4% versus the Russell 2000 Index decrease of -33.8%.
For the fourth quarter, the Clearwater Growth Fund decreased by -22.2%, versus
the Russell 1000 Index decrease of -22.5%, while the Clearwater Small Cap Fund
decreased by -27.4% versus an decrease of -26.1% for the Russell 2000 Index.
On December 31, 2008 the net asset value of the Clearwater Tax-Exempt Bond Fund
was $8.09 per unit. On a total return basis for 2008 the fund decreased -11.8%
with a fourth quarter return of -7.5%. For comparative purposes, the Lehman
5-Year Municipal Bond Index increased 5.8% for the year with a 3.9% increase in
the fourth quarter.
Parametric Portfolio Associates, the sub-advisor for the Clearwater Growth Fund,
made the following comments:
The US equity market suffered its worst quarterly decline in 21 years with the
S&P 500 Index losing 21.9% in the fourth quarter. Failure was imminent at many
of the largest and oldest financial institutions in the US due to their exposure
to mortgage-backed debt. On December 1, the National Bureau of Economic Research
revealed that the US economy has been in a recession since December 2007, making
it the fourth longest recession on record.
All economic sectors posted negative returns in the final quarter of 2008. Not
surprisingly, the financial services sector was the hardest hit, down 36.9%, as
the US government became the unintentional owner of troubled financial assets.
Other poor performing sectors were cyclical materials, -30.8%, technology,
- -25.7%, and industrials, -23.9%, all sectors that are sensitive to changes in
the overall economy. The top performing sectors were defensive, such as
telecommunications, -1.4%, utilities, -10.9%, health care, -12.1%, and consumer
staples, -12.8%, as investors favored stocks that can weather a slumping economy
and slowing corporate profit growth. Growth stocks beat value stocks during the
quarter (S&P 500/Citigroup Growth Index, -20.2%; S&P 500/Citigroup Value Index,
- -23.8%), largely due to the lack of financials in the Growth Index. Mid- and
small-cap stocks performed similarly to large-caps in a punishing quarter for
all segments of the market (S&P MidCap 400 Index, -25.6%; S&P SmallCap 600
Index, -25.2%).
Stocks are now inexpensive by historical measures. But the events of the past
year have little historical context. Whether the market collapse of 2008 proves
to be another example of an asset bubble bursting, or instead marks a
fundamental structural change in how credit markets operate, our broadly
diversified, sector-neutral Tax Managed Core portfolios will provide a great
opportunity to capture the next market leaders, while doing so in a tax
efficient manner.
Comparison of the Change in Value of a $10,000 Investment in the Clearwater
Growth Fund and the Russell 1000 Index*
Past performance is not predictive of future performance. The graph and table do
not reflect the deduction of taxes that you would pay on fund distributions or
the redemption of future shares.
Total Return One Year Five Year Ten Year
- --------------------------------------------------------------------------------
Growth Fund -37.5% -2.2% -0.5%
Russell 1000 -37.6% -2.0% -1.1%
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Growth Fund Russell 1000
12/31/1998 $10,000 $10,000
12/31/1999 $12,428 $12,091
12/31/2000 $12,176 $11,149
12/31/2001 $10,571 $ 9,761
12/31/2002 $ 8,215 $ 7,648
12/31/2003 $10,639 $ 9,934
12/31/2004 $11,867 $11,067
12/31/2005 $12,565 $11,760
12/31/2006 $14,420 $13,578
12/31/2007 $15,193 $14,362
12/31/2008 $ 9,501 $ 8,961
* The Russell 1000 Index is a capitalization-weighted total return index
composed of the largest 1,000 U.S. companies.
The Clearwater Small Cap Fund is advised by two subadvisors: Kennedy Capital
Management and Keeley Capital Management. For the year ended December 31, 2008,
the return for the Fund as a whole was -37.4%. The weight of each subadvisor and
their performance was:
One Year Return Weight
--------------------------------------------
Kennedy -35.5 76%
Keeley -43.0 24%
Kennedy Capital Management, one of the sub-advisors to the Clearwater Small Cap
Fund, made the following comments about the market and their portion of the
portfolio:
We have now closed out the most challenging year in our history. It has been a
frustrating period for both Kennedy Capital Management and our clients, as our
time-tested strategies did not enable us to sidestep the carnage in the global
capital markets. While it may be salutary to view this difficult period in the
rearview mirror, by no means should one interpret the switch to a new calendar
as anything more than that. We remain enmeshed in a worsening global
macroeconomic environment. Employment is unlikely to improve in the near term
and home prices are not poised to move higher. Globally, government balance
sheets will continue to worsen and safety nets will likely fray. In the "Current
Perspective" section below, we more fully explore this situation and how it
impacts the construction of the current Kennedy Core portfolio.
Although our Core strategy has not enabled us to outperform in 2008, years of
successfully implementing such a strategy lends confidence to our steadfast
approach. Some may view it as stubborn, but we simply see it as logical.
Historically, markets have eventually rewarded those companies that combine
advantaged business models with intelligent capital management.
One important tenet to our Core strategy is to invest in companies with limited
Wall Street coverage. A key strength of Kennedy is using the knowledge base and
size of our research team to uncover opportunities not yet found by other
investors and Wall Street. Although we find that opportunity set to be too small
to fully populate our portfolios, we still tend to over-weight stocks with fewer
sell-side analysts covering them. In 2008, that was a headwind for the
portfolio. Examining performance by number of analysts, we see that those with
1-5 analyst coverage underperformed those with 6-15 by more than 250 basis
points. There are probably several factors explaining this, but it is likely
that stocks with limited coverage tend to be more impacted by forced widespread
selling.
The valuation opportunities in our portfolio remain plentiful. As compared to
the Russell 2000(R), and to the previous quarter, our Core portfolio is
attractively valued. When we combine these rudimentary statistics with our
discipline of having constructed a portfolio that is highly focused on the
strongest management teams and the businesses with the most attractive return on
investment, we have exceptional confidence that we will out perform in the
future.
Performance
Sectors that were significantly over-weighted versus the benchmark in 2008 were
Materials & Processing, Technology and Utilities. Sectors that were
significantly underweighted were Financial Services, Health Care, and Consumer
Discretionary.
The areas of strongest relative performance in 2008 were Health Care, Consumer
Staples, and Technology sectors of the Composite. The areas of weakest relative
performance were within the Other Energy, Autos & Transportation, and Materials
& Processing sectors of the Composite.
Current Perspective
We expect that we would not meet with too much resistance if we argued that the
global economy has not yet bottomed. As described at the onset of this letter,
there are several apparent areas of continuing weakness, including employment
and housing. We will not be able to predict the bottom of this cycle. We can,
however, work to position ourselves to both weather the storm and participate in
the market recovery.
Our team is working diligently to find companies whose share prices too severely
discount likely cash flows. Viewed from another angle, we are trying to find
valuations that incorporate an irrational time span of depressed cash flow. At
the same time, we remain comfortable allocating a portion of our portfolio into
companies with persistent competitive advantage, secular tailwinds, and/or
superior management teams.
Creditworthiness is an important topic to address in our perspective. While it
is imperative to consider the soundness of a company's balance sheet, equity
investors often over-react to the presence of debt. Relatively high debt to
capitalization is worthy of a red flag, but it is far from the whole story. We
need to understand the tenor of the debt, the interest rate, and the covenants.
Many leveraged companies with cash-generative business models, low interest
rates, and low capital intensity continue to generate solid free cash flows to
equity holders. This is what we are ultimately working to forecast.
This is from our October 2008 investor letter:
"While our near-term outlook is far from optimistic, we do believe we are
progressing towards a bottom and a likely turnaround. We recognize that
our expertise is not in precisely timing the upturn; therefore, we remain
well-diversified across industries; however, you will find that we will
likely have a paucity of ideas in sectors that directly rely on a consumer
rebound."
Of course, we continue to progress towards a bottom. Although we still have very
few ideas that rely on a consumer rebound, we are working hard to find the well
managed companies whose share prices overly discount the plight of the consumer.
These difficult times will fade before long. The market will price in the
recovery well before it is evidenced by economic statistics. In fact, we have
already had some bouts of market anticipation of economic recovery. There will
inevitably be fits and starts as intra-quarter perception crashes into
quarter-end earnings and forecasts.
Portfolio Construction and Outlook
Our Financial Services weighting rose appreciably in Q4 '08. Despite a 414 basis
point increase in our allocation, we remain substantially underweight the sector
(-600 bps). Our increased holdings in the reinsurance area comprised a large
portion of our increased exposure. We have become incrementally more comfortable
that certain reinsurance companies have bolstered their balance sheets and are
experiencing a strengthening underwriting environment.
Our Materials & Processing weighting has fallen sharply in the latest quarter,
as we became increasingly concerned that valuations were not appropriately
capturing the likely length and depth of the global industrial weakness.
Our Technology weighting remains high - rising from 16.09% to 17.80% of the
portfolio -- but includes a heavy defense orientation, including such stocks as
Viasat Inc., CACI International Inc., and Anaren Inc.
We continue our commitment to managing well-diversified portfolios on behalf of
our clients, with approximately 90-115 positions representing a broad array of
growth and value. We believe the Clearwater portfolio exhibits excellent
risk-return characteristics overall, characterized by expected long-term
earnings growth rates commensurate with the benchmark, but with superior
valuations. Based on several metrics, including Price to Book, Price to Sales
and Price to Forward Earnings ratios, the portfolio exhibits an increasingly
attractive valuation profile, which we believe will serve Clearwater well in
months and years to come.
Keeley Capital Management: the other sub-advisor to the Clearwater Small Cap
Fund, made the following comments:
Market Overview
Investors endured one of the harshest periods on record during the fourth
quarter. These severe declines in the equity markets made the full year 2008
finish with the worst annual market performance since the 1930s. The United
States and many other countries are caught in the grip of a deep recession which
began over one year ago and worsened in the last four months of the year.
A host of problems plagued the stock market throughout the year starting with an
unprecedented credit crisis, severe traumas to the housing and energy markets
and a succession of bailout and rescue maneuvers that will likely alter the
financial landscape
for decades to come. At this time, the U.S. economy is operating in an
environment of extreme consumer and business caution which is keeping spending
and, in turn, the economy in a serious recession. In response, the government is
taking aggressive action to facilitate a turnaround in the economy. For
instance, in December the Federal Reserve dropped the Fed Funds rate to 25 basis
points and will allow this rate to float between zero and .25. In addition, the
Fed announced that they will "employ all available tools...to preserve price
stability". Notable here are the lending programs and mortgage support
initiatives which have already begun to drive mortgages rates lower in recent
weeks. In addition, a major stimulus package will likely be enacted. This
stimulus is in addition to the TARP plan which has been primarily used to inject
capital into our banking system. Clearly the Fed is being much more aggressive
than the Bank of Japan following Japan's "bubble bust' as well as more proactive
than during the United States Depression years.
Given this backdrop, much of the pressure that the market and our portfolios
experienced toward the end of the 3rd quarter spilled over into the 4th quarter.
The credit crisis provoked a massive deleveraging in the financial system
initiated by hedge fund liquidations in response to an unprecedented (sometimes
40:1) amount of leverage. Panic and poor performance eventually led to hedge
fund client redemptions - exacerbating the selling pressure of the stocks within
their portfolios. Unfortunately, hedge funds found many of our positions to be
attractive, specifically stocks in the industrial, energy, and materials
sectors. While these sectors led the market higher for much of the past few
years, the recent forced selling via hedge fund redemptions made the sell-off in
these areas much more severe than the fundamentals would suggest. Unfortunately,
very little attention is being paid to this fundamental data, as panic and
uncertainty engulfed the market.
In emotional markets such as these it is imperative to stick to our discipline
of continually monitoring the fundamental health of the companies that we hold.
To that end, we have been generally pleased with these fundamental results as we
have evaluated quarterly earnings reported over the past months. Overall, the
majority of our stocks posted positive earnings - validating our belief that
many of our companies continue to possess strong fundamentals and a solid
long-term growth story. However, we do understand that global growth has been
downsized dramatically and the lack of long-term visibility by management was
apparent during several of our conference calls. Many of our companies are
bracing for a difficult short-term environment. While that may sound
pessimistic, we believe the market has already priced in much of this negativity
and companies are trading at valuations we have not seen since the 1973-1974
bear market. There is currently an abundance of opportunities, and we plan on
patiently taking advantage.
Sector Weightings
Since inception of the portfolio, we have favored companies in the energy and
industrial sectors while underweighting the portfolio in financial services
related companies. This sector emphasis served the portfolio very well in recent
years--up until the beginning of
the third quarter. A hallmark of severe downturns in the stock market is that
ultimately all of the sectors that had been leading the market endure a sharp
correction. The energy and industrial sectors had been the leadership sectors
for the past three years. However, in the third quarter these sectors began a
very sudden and steep sell-off which continued into the fourth quarter. At the
same time the financial services sector-- which had been among the weakest
groups in recent years, staged a rally in the third quarter and remained
stronger than the broader market in the fourth quarter. These abrupt sector
reversals are the primary reason that the portfolio underperformed the benchmark
during the second half of the year.
Outlook
We believe the economy will show positive sequential performance starting with
the second quarter of 2009. At that time, we expect that the market will begin
to show positive gains as well. Additionally, despite the near-term uncertainty
surrounding many of these companies, we continue to believe the fundamentals of
our positions in the energy, industrial, and materials sectors are more
compelling than most, especially the financial sector. Although the performance
of many financial stocks has held up better than the broad market, especially
late in the 3rd quarter, we can find very few compelling reasons to own the
majority of these stocks. Government involvement has placed even more doubt
around this sector which already lacked any true fundamental transparency. These
events were disappointing to us as we believe our assessment of the situation
has been accurate and consistent with our discipline of avoiding value traps and
focusing on companies that we can understand. We remain committed to our
fundamental belief that our current portfolio over-weights are correct.
While we will opportunistically identify attractive situations within the
financial sector, we cannot feel comfortable with the majority of these names
until the credit cycle is corrected and government intervention is circumvented.
With that said, we are beginning to find opportunities among some property &
casualty stocks, which we hope can gain market share at the expense of companies
such as AIG. Likewise, we have become more constructive on select health care
companies as some restructuring and spin-offs have developed in the
manufacturing and distribution areas of that sector.
During periods of uncertainty, fundamentals are often ignored due to emotion and
distress, but we continue to focus on companies that possess sound fundamentals
and strong balance sheets. Strong cash flow is and always has been a key
component of our fundamental analysis. We believe these characteristics will
carry our companies through this environment and eventually allow them to
capture market share by making strategic acquisitions or benefiting from the
less stable. Fortunately, opportunities are plentiful and we will take advantage
of the volatility and lack of confidence that is encompassing the markets on a
day-to-day basis. Remember, we are trying to identify stocks that we can hold
for the next 3-5 years. At times like this our buy and hold methodology will
face challenges, but we are not trying to pick the bottom of this market nor do
we need to. Valuations at present levels are attractive and the growth potential
of our companies over a long-term perspective is extremely compelling.
Clearly, what we face today in our financial markets is unique and in many ways
unparalleled in our history. However, in turbulent times we point to our
experience in the investment business and the many lessons learned during that
time period. Experience has taught us that despite how the markets perform on a
day-to-day basis, companies with strong fundamentals will prevail in the
long-term. We believe the experience of our investment research team and the
repeatability of our unique corporate restructuring process gives us a distinct
advantage over our peers and passive benchmarks over the long-term.
The current environment will continue to present road blocks and challenges. We
have the utmost confidence in our investment process and our ability to identify
opportunities that will prosper once a sense of normalcy and stability returns
to the financial markets. This will not be easy and it will take time. However,
while the short-term outlook may be unclear, we believe that long-term investors
face a fantastic opportunity to benefit from the compelling valuations that are
offered right now.
Comparison of the Change in Value of a $10,000 Investment in the
Clearwater Small Cap Fund and the Russell 2000 Index*
Past performance is not predictive of future performance. The graph and table do
not reflect the deduction of taxes that you would pay on fund distributions or
the redemption of future shares.
Total Return One Year Five Year Ten Year
--------------------------------------------------------------
Small Cap Fund -37.4% 0.0% 8.5%
Russell 2000 -33.8% -0.9% 3.0%
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Small Cap Fund Russell 2000
12/31/1998 $10,000 $10,000
12/31/1999 $12,730 $12,126
12/31/2000 $14,091 $11,759
12/31/2001 $15,966 $12,052
12/31/2002 $14,327 $ 9,583
12/31/2003 $22,732 $14,111
12/31/2004 $27,482 $16,698
12/31/2005 $30,022 $17,458
12/31/2006 $35,144 $20,661
12/31/2007 $36,244 $20,342
12/31/2008 $22,693 $13,467
* The Russell 2000 Index is a capitalization-weighted total return index of the
2,000 smallest companies in the Russell 3000 Index.
SIT Investment Associates: the sub-advisor for the Clearwater Tax-Exempt Bond
Fund, made the following comments:
2008 was one of the most volatile years on record for the fixed income markets.
The first half of the year was difficult (downgrades of bond insurers, failures
of auction-rate securities, and the collapse of Bear Stearns), continuing the
weakness from the liquidity crisis that began in July 2007. Fixed income markets
really soured after Labor Day, however, as first FNMA and FHLMC had to be
rescued, Lehman failed, AIG was rescued, and many banks and brokers merged,
received capital infusions from the federal government, or both. U.S. Treasuries
were the only strong performers during this period.
The Federal Reserve applied aggressive actions throughout the year, lowering the
federal funds rate from 4.25% at the beginning of the year to near zero by
December. In addition, the Fed used many other means to pump liquidity into
fixed income markets. Investor fears resulted in a flight to quality, with only
U.S. Treasuries and agencies, as well as mortgage-backed securities backed by
agencies, producing positive returns. Returns for both corporate and tax-exempt
indices were generally negative, with only the very shortest maturities
providing positive returns.
The U.S. Treasury and municipal yield curves steepened considerably during the
year. Long-term Treasury yields finished the year about 175 basis points lower,
while short-term yields fell about 315 basis points. Long-term municipal yields
actually increased about 150 basis points during 2008, while short-term yields
fell close to 100 basis points. Heavy issuance in the government markets
continued, but issuance slowed considerably in the corporate and tax-exempt
markets as the liquidity crisis worsened. Deleveraging by hedge funds and
remarketing of short-term variable or auction-rate debt into long-term fixed
rate debt were the primary drivers in forcing tax-exempt yields higher.
Ratios of tax-exempt yields to Treasuries reached unprecedented levels in 2008,
rising from their normal level of 85-90% of Treasuries to more than 200% in some
cases. This phenomenon is un-sustainable, and will likely be brought closer to
historic norms by both a rise in Treasury yields and a fall in tax-exempt yields
during 2009. With a recession gripping the domestic economy, the Fed is likely
to continue to be accommodative in 2009. Furthermore, fiscal stimulus from the
Obama administration will have a significant impact on fixed income markets in
2009 and beyond. Returns in fixed income markets, except for U.S. Treasuries,
are likely to be bumpy but positive as the Fed's accommodative policies and the
federal government's fiscal stimulus take hold.
The recent trend of revenue bonds underperforming general obligation bonds
remained intact during 2008, shorter duration outperformed longer duration, and
higher quality issues outperformed those of lower credit quality, as investors
favored high quality and certainty in bond structures over yield. We expect
revenue bonds to be strong performers in 2009, however, as the Fed's
accommodative policies and the Obama administration's fiscal stimulus should
help allay liquidity concerns in the market, and investor focus returns to
yield.
General obligation bond performance should weaken on a relative basis, however,
as many cities, counties and states may experience revenue shortfalls with the
economy in recession and continued weakness in the housing sector. In addition,
potential problems funding retirement pension and healthcare obligations still
persist. The Fund's performance, with its heavy emphasis on revenue bonds, was
very weak on an absolute basis due to the sectors and structures in which it was
invested, its longer duration, and its use of non-rated revenue bonds, whose
spreads widened considerably with the flight to quality in the municipal market.
Non-rated and rated revenue bonds significantly enhance total return performance
in periods of stable or rising interest rates, but often underperform in an
environment of rapidly falling Treasury rates, which is what the market and the
Fund experienced in 2008.
The economy officially dipped into recession in December 2007, and has continued
to get progressively weaker. We expect the recession to continue through the
first half of 2009, with slightly positive growth in the second half of 2009, as
the Fed's accommodative policies and the federal government's proposed stimulus
plan take effect. With the housing and subprime mortgage mess still unwinding
and unemployment reaching levels not seen in decades, interest rates are likely
to be volatile over the first half of the year. The Treasury yield curve should
remain relatively steep, with yields rising across the curve, while the
tax-exempt curve grows somewhat flatter, with long-term municipal yields
falling.
Given that the Fed is done with its easing, we lengthened the Fund's average
life duration, a measure of the Fund's sensitivity to changes in interest rates,
from 4.6 to 5.6 years during the year, accompanied by a meaningful increase in
yield. For comparison, the Fund's benchmark, the Lehman 5-Year Municipal Bond
Fund Index, had duration of 4.1 years at December 31, 2008. The Fund's longer
duration and its use of non-rated bonds have positioned it opportunistically for
the economic and interest rate environment that we expect in 2009. The Fund's
strong yield (its 12-month distribution rate improved to 4.80% at December 31)
should continue to produce high tax-exempt income for its shareholders in the
current and expected market environment. Investment of new cash flows will be
focused on maturities in the 5-25 year range.
Comparison of the Change in Value of a $10,000 Investment in the Clearwater
Tax-Exempt Bond Fund and the Lehman Brothers 5-Year Municipal Bond Fund Index*
Past performance is not predictive of future performance. The graph and table do
not reflect the deduction of taxes that you would pay on fund distributions or
the redemption of future shares.
Total Return One Year Five Year Inception 1/14/2000
---------------------------------------------------------------------------
Tax-Exempt Bond Fund -11.8% 0.3% 3.1%
Lehman 5 Yr Muni 5.8% 3.6% 5.1%
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Tax-Exempt Bond Fund Lehman 5-Year Municipal Bond Index
1/14/2000 $10,000 $10,000
12/31/2000 $10,890 $10,772
12/31/2001 $11,549 $11,441
12/31/2002 $12,370 $12,502
12/31/2003 $12,882 $13,017
12/31/2004 $13,406 $13,372
12/31/2005 $14,017 $13,499
12/31/2006 $14,765 $13,949
12/31/2007 $14,858 $14,665
12/31/2008 $13,102 $15,514
* The Lehman Brothers 5- year Municipal Bond Index consists of issues with a
maturity of 4-6 years, a minimum credit rating of at least Baa, have been issued
as a part of a deal of over $50 million, and have been issued within the last 5
years.
Clearwater Investment Trust Clearwater Management Company
- --------------------------- -----------------------------
G. H. Weyerhaeuser, Jr., President and CEO P. W. Pascoe, Chairman and Treasurer
L. R. Jones W. T. Weyerhaeuser, V.P. and Secretary
C. W. Rasmussen S. B. Carr, Jr.
L. Rasmussen W. J. Driscoll
F. T. Weyerhaeuser E. D. Hlavka
J. H. Weyerhaeuser C. W. Morley
F. W. Piasecki
D. C. Titcomb
Shareholder Expense Example (Unaudited)
As a shareholder of the Funds, you incur costs, including management fees and
other Fund expenses. This Example is intended to help you to understand your
ongoing costs (in dollars) of investing in the Funds.
The example is based on an investment of $1,000 invested at the beginning of the
period and held for the entire period from July 1, 2008 to December 31, 2008.
Actual Expenses
The first section of the table below provides information about actual account
values and actual expenses. You may use the information in this section,
together with the amount you invested, to estimate the expenses that you
incurred over the period. Simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the
result by the number in the first section under the heading entitled "Expenses
Paid During the Period" to estimate the expenses attributable to your investment
during this period.
Hypothetical Example for Comparison Purposes
The second section of the table below provides information about hypothetical
account values and hypothetical expenses based on the Fund's actual expense
ratio and an assumed rate of return of 5% per year before expenses, which is not
the Fund's actual return. Thus, you should not use the hypothetical account
values and expenses to estimate the actual ending account balance or your
expenses for the period. Rather, these figures are provided to enable you to
compare the ongoing costs of investing in the Clearwater Funds and funds offered
by other organizations. To do so, compare this 5% hypothetical example with the
5% hypothetical examples that appear in the shareholder reports of the other
funds.
Please note that the expenses shown in the second section of the table are meant
to highlight your ongoing costs only. Therefore, the second section of the table
is useful in comparing ongoing costs only, and will not help you compare the
relative total costs of the Clearwater Funds to funds that charge transaction
costs and/or sales charges or redemption fees.
Expenses Paid
Ending Account During the Period*
Beginning Account Value July 1, 2008 thru
Value December 31, December 31,
Actual July 1, 2008 2008 2008
- -----------------------------------------------------------------------------------------
Growth Fund $1,000.00 $ 705.40 $1.20
Small Cap Fund $1,000.00 $ 660.10 $3.96
Tax-Exempt Bond Fund $1,000.00 $ 883.20 $1.70
Hypothetical (5% return before
expenses)
Growth Fund $1,000.00 $1,025.14 $1.43
Small Cap Fund $1,000.00 $1,025.14 $4.84
Tax-Exempt Bond Fund $1,000.00 $1,025.14 $1.83
*Expenses are equal to the Fund's annualized expense ratios, multiplied by the
average account value over the period, multiplied by 184/365 (to reflect the
one-half year period). The annualized expense ratios are as follows:
Growth Fund 0.28%
Small Cap Fund 0.95%
Tax-Exempt Bond Fund 0.36%
Quarterly Portfolio Schedule of Investments
The Funds file a complete schedule of their portfolio holdings as of the close
of the first and third quarters of their fiscal years with the SEC on Form N-Q.
Shareholders may request copies of Form N-Q free of charge by calling the
Transfer Agent toll free at 1-888-228-0935 or by sending a written request to:
Fiduciary Counselling, Inc, 30 East 7th Street, Suite 2000, St. Paul, MN 55101
Attn: Clearwater Investment Trust Transfer Agent. These filings are also
available on the SEC's Internet site at http://www.sec.gov and may be reviewed
and copied at the SEC's Public Reference Room in Washington, DC. Information
about the public reference room may be obtained by calling 1-800-SEC-0330.
Voting Proxies on Fund Portfolio Securities
The funds have established Proxy Voting Policies and Procedure ("Policies") that
the funds use to determine how to vote proxies relating to portfolio securities.
They also report, on Form N-PX, how the Funds voted any such proxies during the
most recent 12-month period ended June 30. Shareholders may request copies of
the Policies or Form N-PX free of charge by calling the Transfer Agent toll free
at 1-888-228-0935 or by sending a written request to: Fiduciary Counselling,
Inc, 30 East 7th Street, Suite 2000, St. Paul, MN 55101 Attn: Clearwater
Investment Trust Transfer Agent. Form N-PX is also available from the EDGAR
database on the SEC's Internet site at http://www.sec.gov.
EXECUTIVE OFFICERS AND TRUSTEES
Information About the Independent Trustees
- ----------------------------------------------------------------------------------------------------------------
Number of
Term of Portfolios in
Office and Principal the Fund Other
Positions Length of Occupation(s) Complex Directorships
Name, Address Held with the Time During the Last Overseen by Held by the
and Age Funds Served 5 Years the Trustee Trustee
- ----------------------------------------------------------------------------------------------------------------
Lucy R. Jones (67) Trustee Tenure: 9 yrs Private Investor 3 None
30 East 7th Street, Term:
Saint Paul, Minnesota Indefinite
55101
- ----------------------------------------------------------------------------------------------------------------
Charles W. Rasmussen Trustee Tenure: 9 yrs President and Chief 3 None
(42)(1) Term: Executive Officer,
30 East 7th Street, Indefinite P&G Manufacturing,
Saint Paul, Minnesota Inc. (air
55101 filtration
equipment,
2002-Present)
- ----------------------------------------------------------------------------------------------------------------
Laura E. Rasmussen Trustee Tenure: 9 yrs Business Owner 3 None
(45)(1) Term:
30 East 7th Street, Indefinite
Saint Paul, Minnesota
55101
- ----------------------------------------------------------------------------------------------------------------
Justin H. Weyerhaeuser Trustee Tenure: 1 yr Private Investor 3 None
(35)
30 East 7th Street, Term:
Saint Paul, Minnesota Indefinite
55101
- ----------------------------------------------------------------------------------------------------------------
(1) Mr. Rasmussen and Ms. Rasmussen are spouses-in-law, and are nieces or
nephews of Mr. Frederick T. Weyerhaeuser (see below).
Information about the Funds' Executive Officers and Interested Trustees
- ----------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
the Fund
Term of Principal Complex Other
Name, Positions Office and Occupation(s) Overseen Directorships
Address and Held with Length of During the Last by the Held by the
Age the Funds Time Served 5 Years Trustee Trustee
- ----------------------------------------------------------------------------------------------------------------
Frederick T. Trustee, Vice As Trustee; Private Investor 3 Potlatch
Weyerhaeuser (77)* President and Tenure: 21 yrs Corporation
30 East 7th Street, Secretary Term: Indefinite (1960-2003)
Saint Paul,
Minnesota 55101 As Officer;
Tenure: 21 yrs
Term:
Reappointed
Annually
- ----------------------------------------------------------------------------------------------------------------
George H. Trustee, As Trustee: Senior Vice 3 None
Weyerhaeuser Jr. Chairman, Tenure: 2 yrs President,
(55)** Chief Term: Technology,
30 East 7th Street, Executive Indefinite Weyerhaeuser
Saint Paul, Officer and Company (1998 -
Minnesota 55101 Treasurer As Officer: 2006)
Tenure: 2 yrs
Term: Director,
Reappointed Clearwater
Annually Management Company
(1987 - 2006)
Member,
Advisory Board,
Pictet Advisory
Overseas Services
Ltd (2009-Present)
- ----------------------------------------------------------------------------------------------------------------
Susanne S. Smith Chief Tenure: October Clearwater N/A N/A
(49) Compliance 2004 - June Management
30 East 7th Street, Officer 2006; December Company, Inc:
Saint Paul, 2007 - Present Chief Compliance
Minnesota 55101 Term: Officer, 10-04 to
Reappointed 6-06, and 12-07 to
Present; Fiduciary
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
Annually Counselling, Inc.:
Chief Compliance
Officer, 10-04- to
6-06, and 12-07 to
Present;
Secretary, 12-07
to Present; Senior
Compliance and Tax
Analyst, 6-06 to
12-2007; Manager,
Tax Compliance,
1987 to 6-06.
- ----------------------------------------------------------------------------------------------------------------
* Mr. F.T. Weyerhaeuser is an interested trustee due to his daughter's position
as a director of Clearwater Management Company, the Funds' investment manager.
**Mr. G.H. Weyerhaeuser Jr. is an interested trustee due to his positions as the
Funds' CEO and Treasurer.
Additional information about the Fund Directors is available in the Fund's
Statement of Additional Information (SAI). The SAI is available, without charge,
upon request, by contacting the transfer agent at (888) 228-0935 or writing the
funds at 2000 Wells Fargo Place, 30 East 7th Street, St. Paul, Minnesota
55101-4930. The funds do not have an Internet Web site.
Board Approval of the Investment Advisory Agreement and Subadvisory Contracts
(Unaudited)
Clearwater Management Company
- -----------------------------
Clearwater Management Company (CMC) is responsible for managing the investment
programs and strategies for the Growth Fund, Small Cap Fund and Tax-Exempt Bond
Fund. The Trustees agreed to retain CMC under the terms of the investment
advisory agreement dated March 1, 1998. The agreement will continue for one year
and is renewable for successive one-year periods.
The Trustees discussed the materials presented throughout the year and those
presented during the meeting in connection with the annual advisory agreement
renewal with Clearwater Management Co. Inc. (CMC). The board based its decision
on the information contained in the materials presented. The Trustees considered
the factors discussed below among others. No single factor determined whether or
not the agreement would be renewed but rather the totality of factors considered
was determinative.
Nature, Extent and Quality of Services Provided
- -----------------------------------------------
The Trustees considered the nature and quality of the services provided by CMC
since 1987. The Trustees considered the quality of the due diligence work that
CMC performs on the sub-advisers and noted the good reputation that the CMC
board has with the shareholder base. They also noted their approval of the
various ideas for enhancements and adjustments to the funds made by CMC. The
Trustees considered reports presented to them which demonstrate CMC's compliance
with both its and the fund's compliance policies and procedures and Codes of
Ethics. Based on their analysis of the data presented, the Trustees concluded
that they were pleased with the nature and quality of the service provided.
Investment Performance
- ----------------------
The Trustees considered the work performed by CMC in monitoring the investment
performance of the various sub-advisers. They noted their approval of the
investment performance of the funds compared to other funds with similar
objectives. The Trustees concluded that they were pleased with the services that
CMC provided regarding the investment performance of the funds.
Cost of Services
- ----------------
The Trustees reviewed the fees paid to CMC. They noted their appreciation that
CMC has negotiated the best deal possible with the sub-advisers regarding their
fees. They were also pleased with CMC's willingness to limit their profitability
through voluntary fee reductions, including the most recent waiver effective
July 1, 2008. It was also noted that CMC charges a fixed fee which results in
fewer cost fluctuations and willingly pays certain expenses that are normally
borne by the shareholders, namely the Fidelity transaction fee. The Trustees
concluded that they were pleased with the cost of services paid to CMC, noting
that the fee is very reasonable for the services provided.
Parametric Portfolio Associates
- -------------------------------
Parametric Portfolio Associates (Parametric) is responsible for managing the
investment program and strategies for the Growth Fund. The Trustees agreed to
retain Parametric under the terms of the subadvisory contract dated September
20, 2001. The agreement will continue for one year and is renewable for
successive one-year periods.
The Trustees considered the materials presented throughout the year and based
their decision on that information, including the most recent evaluation of
Parametric's investment staff, portfolio management process and fund
performance. The Trustees considered the factors discussed below among others.
No single factor determined whether or not the agreement would be renewed but
rather the totality of factors considered was determinative.
Nature, Extent and Quality of Services Provided
- -----------------------------------------------
The trustees considered the depth and experience of the Parametric organization.
Parametric was founded in 1987 and currently has assets under management of
$20.0 billion and employs a team of thirty-one investment professionals. They
specialize in index-based and structured equity strategies and are considered
the industry leader in tax-efficient portfolio management. Parametric uses a
quantitative, technology driven process that can be highly automated. Parametric
has been managing the Growth Fund since 1997 and has had four ownership changes
during this timeframe. Brian Langstraat is the Chief Executive Officer and he
has been with Parametric since 1990. Brook Beresh manages the portfolio. The
investment objective of the Clearwater Growth Fund is to achieve long-term,
broad, diversified exposure to the U.S. equity market in a tax-efficient and low
cost manner. The portfolio targets the Russell 1000 index. The trustees also
considered reports presented to them which demonstrate Parametric's compliance
with both its and the fund's compliance polices and procedures and codes of
ethics. Based on their analysis of the data presented, the trustees concluded
that they were pleased with the nature and quality of the services provided.
Investment Performance
- ----------------------
The trustees considered the fund's performance in the short and intermediate
terms as well as since inception. They compared the fund's performance to
relevant benchmarks and peer groups and noted that the returns have met
expectations in recent years. They paid particular attention to the performance
reports prepared for their consideration by the fund's transfer agent and
shareholder service provider that demonstrated consistent performance relative
to the benchmark and noted that the tax efficiency targets have been met or
exceeded. It was noted that the tracking error has been significantly below the
upper limit of 1.5% and is currently at 0.4%.
Cost of Services
- ----------------
The trustees made a comparative analysis of the fund's subadvisory fee relative
to similar funds as well as other institutional investment accounts. The
trustees noted that management fees charged by most advisers directly managing a
fund's portfolio (i.e. not
via hiring a subadviser to manage the portfolio) also covers significant
administrative services not required of Parametric. Parametric charges a fee
based on assets under management on a sliding scale ranging from 45 basis points
on the first $1 million under management to 10 basis points on assets in excess
of $75 million. It was noted that trading costs are exceptionally low as is
typical for a tax-managed account. The management expense as a percentage of
average assets under management in 2008, the time period examined by the
trustees, was 15 basis points or 0.15%. The trustees relied on presentations by
the fund's transfer agent and shareholder servicing provider comparing
Parametric's management fee to its relevant peer groups both within the
investment company universe and within the institutional investor universe in
general. Such presentations relied on reports published by Morningstar. This
analysis led the trustees to determine that the fees charged to the fund were
fair and reasonable in light of the high quality services tailored specifically
to the fund's circumstances. Additionally, the trustees relied, in making their
decision, on Parametric's representation that the fee charged is less than a new
client would pay. The trustees also noted that the fee charged by Parametric
when combined with all other fund expenses resulted in an overall expense ratio
to the fund of .28% of average net assets versus the industry average for large
cap domestic funds of 1.00% according to fund analysis company Morningstar, Inc.
Management Profitability
- ------------------------
The trustees did not consider the profitability of Parametric resulting from its
relationship with the fund. The fund's situation is different from that where
the portfolio is managed by the sole adviser, which established, promotes and
markets the fund as a method of increasing its assets under management and,
therefore, its profitability. Parametric is an independent firm and the advisory
fee charged is the result of arm's length bargaining between Parametric and the
fund's adviser under the supervision of the trustees.
Economies of Scale
- ------------------
The trustees considered whether the fund could enjoy economies of scale as it
grows as a result of Parametric realizing economies of scale. Due to the
quantitative, technology-driven service that can be highly automated, it was
determined that there is no natural limit to the assets that they could manage
under this approach. Also, since the current fee charged by Parametric (.15%) is
lower than their general fee schedule (.20%), there are no benefits to be seen
regarding reducing fees. Based on the above, the trustees determined that
further economies of scale resulting from the relationship with Parametric were
not a consideration in that the fee is already low.
Kennedy Capital Management
- --------------------------
Kennedy Capital Management (Kennedy) is responsible for managing a portion of
the investment program and strategies for the Small Cap Fund. The Trustees
agreed to retain Kennedy under the terms of the subadvisory contract dated April
16, 1999. The agreement will continue for one year and is renewable for
successive one-year periods.
The Trustees considered the materials presented throughout the year and based
their decision on that information, including the most recent evaluation of
Kennedy's investment staff, portfolio management process and fund performance.
The Trustees
considered the factors discussed below among others. No single factor determined
whether or not the agreement would be renewed but rather the totality of factors
considered was determinative.
Nature, Extent and Quality of Services Provided
- -----------------------------------------------
The trustees considered the depth, experience and organizational stability of
the Kennedy Capital organization. Kennedy has been managing investment
portfolios since 1980 with total assets under management of $2.5 billion and
employs a team of twenty-eight investment professionals, including 16 analysts.
They provide active small cap domestic security selection with 93% institutional
and 7% high net worth clients. Kennedy has had a number of management changes
over the years and is currently headed by Randy Kirkland, President and CEO.
Donald Cobin, CFA, is the portfolio manager of the small cap portion and has 15
years of investment experience and has served previously as a portfolio manager,
director of research, and analyst. Tim Hasara is the portfolio manager for the
micro cap portion. Tim Hasara has 13 years of experience as an investment
analyst and portfolio manager at Kennedy. Kennedy Capital is research-intensive
and narrowly focused on small cap equities. Their process has evolved since they
were originally hired to manage the fund in 1994 into a very sophisticated set
of fundamental criteria that captures the contrarian philosophy of the firm's
founders. This has resulted in long term investment returns well above both the
fund's peers and its comparable indices. The trustees also considered reports
presented to them which demonstrate Kennedy's compliance with both its and the
fund's compliance polices and procedures and codes of ethics. Based on their
analysis of the data presented, the trustees concluded that they were pleased
with the nature and quality of the services provided.
Investment Performance
- ----------------------
The trustees considered the fund's performance in the short and intermediate
terms as well as since inception. They compared the fund's performance to
relevant benchmarks and peer groups and noted that the returns have not met
expectations. They paid particular attention to the performance reports prepared
for their considerations by the fund's transfer agent and shareholder service
provider that demonstrated average to below average relative performance. The
lack of significant excess returns is fairly recent, however. There is no
indication of a lack of investment skill on the part of the manager. Trading
continues to be a strength for Kennedy. Abel-Noser reports place their execution
near the top of their peer group. Tax efficiency is not a high priority for
Kennedy, but the portfolio manager does review the portfolio for tax-loss
harvesting opportunities and strives to hold securities long enough to achieve
long-term gain status. Due to their long-term exceptional pre-tax returns, the
minimal attention to tax efficiency has not been a large drawback. The trustees
concluded that they were satisfied with Kennedy Capital's long-term investment
management performance.
Cost of Services
- ----------------
The trustees made a comparative analysis of the fund's subadvisory fee relative
to similar small cap funds as well as other institutional investment accounts.
The trustees noted that management fees charged by most advisers directly
managing a fund's portfolio (i.e. not via hiring a subadviser to manage the
portfolio) also cover significant administrative
services not required of Kennedy. Kennedy charges a fee based on assets under
management on a sliding scale ranging from 85 basis points on the first $50
million under management to 80 basis points on assets in excess of $50 million.
The management expense as a percentage of average assets under management in
2008, the time period examined by the trustees, was 82 basis points or 0.82%.
The trustees relied on presentations by the fund's transfer agent and
shareholder servicing provider comparing Kennedy's management fee to its
relevant peer groups both within the investment company universe and within the
institutional investor universe in general. Such presentations relied upon
reports published by Morningstar. This analysis led the trustees to determine
that the fees charged to the fund were fair and reasonable in light of the high
quality services provided. Additionally, the trustees relied, in making their
decision, on Kennedy's representation that no client with a similar account was
being charged a lesser fee. The trustees also noted that the fee charged by
Kennedy when combined with all other fund expenses resulted in an overall
expense ratio to the fund of 0.95% of average net assets versus the industry
average for small cap domestic funds of 1.19% according to fund analysis company
Morningstar, Inc.
Management Profitability
- ------------------------
The trustees did not consider the profitability of Kennedy resulting from its
relationship with the fund. The fund's situation is different from that where
the portfolio is managed by the sole adviser, which established, promotes and
markets the fund as a method of increasing its assets under management and,
therefore, its profitability. Kennedy is an independent firm and the advisory
fee charged is the result of arm's length bargaining between Kennedy and the
fund's adviser under the supervision of the trustees.
Economies of Scale
- ------------------
The trustees considered whether the fund could enjoy economies of scale as it
grows as a result of Kennedy realizing economies of scale. They found that there
was some room in the current fee schedule for Kennedy's fee, as a percentage of
assets under management, to go down slightly as a growing asset base moves the
overall percentage down from the current 82 basis points towards 80 basis
points. The trustees determined that further economies of scale resulting from
the relationship with Kennedy were not a major consideration given that the
relationship is the result of arm's length bargaining, most of the economies of
scale have already been realized and that the fee is already low-especially in
light of the quality of service provided.
Keeley Asset Management
- -----------------------
Keeley Asset Management (Keeley) is responsible for managing a portion of the
investment program and strategies for the Small Cap Fund. The Trustees agreed to
retain Keeley under the terms of the subadvisory contract dated August 1, 2006.
The agreement will continue for two years and is renewable for successive
one-year periods.
The Trustees considered the materials presented throughout the year and based
their decision on that information, including the most recent evaluation of
Keeley's investment staff, portfolio management process and fund performance.
The Trustees considered the factors discussed below among others. No single
factor determined whether or not the
agreement would be renewed but rather the totality of factors considered was
determinative.
Nature, Extent and Quality of Services Provided
- -----------------------------------------------
The trustees considered the depth, experience and organizational stability of
the Keeley Asset Management organization. Keeley has been managing investment
portfolios since 1982 with total assets under management of $6.1 billion and
employs a team of ten investment professionals. Keeley is headed by John L.
Keeley, Jr., who is its President, and the fund's portfolio manager. Their
investment strategy is to invest in small to mid cap companies undergoing
internal corporate restructuring. This strategy is viewed as a complement to the
diversified small cap portfolio that is managed by Kennedy Capital Management.
Keeley favors industries with long product life cycles, avoiding technology and
healthcare. A typical portfolio will contain 60-70 holdings with each holding
representing no more than 2% of the portfolio. Cash positions range between
3-10% and the average portfolio turnover is approximately 33%. Keeley regularly
re-balances the portfolio in order to reduce the holdings of appreciated stocks
and to free cash for investment in underweighted securities. The trustees also
considered reports presented to them which demonstrate Keeley's compliance with
both its and the fund's compliance polices and procedures and codes of ethics.
Based on their analysis of the data presented, the trustees concluded that they
were pleased with the nature and quality of the services provided.
Investment Performance
- ----------------------
The trustees considered the subadviser's performance in the short period since
inception. They compared the fund's performance to relevant benchmarks and peer
groups. They paid particular attention to the performance reports prepared for
their considerations by the fund's transfer agent and shareholder service
provider. The trustees concluded that they were satisfied with Keeley's
investment management performance to date but will continue to monitor closely
due to the short-term history with Clearwater.
Cost of Services
- ----------------
The trustees made a comparative analysis of the fund's subadvisory fee relative
to similar small cap funds as well as other institutional investment accounts.
The trustees noted that management fees charged by most advisers directly
managing a fund's portfolio (i.e. not via hiring a subadviser to manage the
portfolio) also cover significant administrative services not required of
Keeley. Keeley charges a fee based on assets under management on a sliding scale
ranging from 100 basis points on the first $2 million under management to 70
basis points on assets in excess of $10 million. The trustees relied on
presentations by the fund's transfer agent and shareholder servicing provider
comparing Keeley's management fee to its relevant peer groups both within the
investment company universe and within the institutional investor universe in
general. Such presentations relied upon reports published by Morningstar. This
analysis led the trustees to determine that the fees charged to the fund were
fair and reasonable in light of the high quality services provided.
Management Profitability
- ------------------------
The trustees did not consider the profitability of Keeley resulting from its
relationship with the fund. The fund's situation is different from that where
the portfolio is managed by the sole adviser, which established, promotes and
markets the fund as a method of increasing its assets under management and,
therefore, its profitability. Keeley is an independent firm and the advisory fee
charged is the result of arm's length bargaining between Keeley and the fund's
adviser under the supervision of the trustees.
Economies of Scale
- ------------------
The trustees considered whether the fund could enjoy economies of scale as it
grows as a result of Keeley realizing economies of scale. They found that there
was some room in the current fee schedule for Keeley's fee, as a percentage of
assets under management, to go down as a growing asset base moves the overall
percentage.
Sit Fixed Income Advisers II
- ----------------------------
Sit Fixed Income Advisers II (Sit) is responsible for managing the investment
program and strategies for the Tax-Exempt Bond Fund. The Trustees agreed to
retain Sit under the terms of the subadvisory contract dated December 15, 1999.
The agreement will continue for one year and is renewable for successive
one-year periods.
The Trustees considered the materials presented throughout the year and based
their decision on that information, including the most recent evaluation of
Sit's investment staff, portfolio management process and fund performance. The
Trustees considered the factors discussed below among others. No single factor
determined whether or not the agreement would be renewed but rather the totality
of factors considered was determinative.
Nature, Extent and Quality of Services Provided
- -----------------------------------------------
The trustees considered the depth, experience and organizational stability of
the Sit organization. Sit and its affiliates have been managing investment
portfolios since 1981 with total assets under management of $6.60 billion and
$5.0 billion in fixed income. Sit is a stable, well-capitalized organization and
has had no ownership changes. Mr. Michael C. Brilley, President and Senior Fixed
Income Officer and manager of the fund, has been in the investment management
business for over 38 years and has been with Sit since 1984. Mr. Paul J.
Jungquist, Vice President and Senior Fixed Income Portfolio Manager and Fixed
Income Credit Analyst and co-manager of the fund has been with Sit since 1994.
He specializes in non-rated securities. The portfolio managers adhere to a
research-intensive and disciplined investment process which, historically, has
resulted in sound investment returns at a level of volatility well below that of
both the fund's peers and its comparison indices. The trustees also considered
reports presented to them which demonstrate Sit's compliance with both its and
the fund's compliance polices and procedures and codes of ethics. Based on their
analysis of the data presented, the trustees concluded that they were pleased
with the nature and quality of the services provided.
Investment Performance
- ----------------------
The trustees considered the fund's performance in the short and intermediate
terms as well as since inception. They compared the fund's performance to
relevant benchmarks and peer groups and noted that the combined risk-adjusted
returns have historically met or exceeded expectations. The Fund's poor
performance over the past two years can be attributed to market conditions, not
to poor decisions on the part of the manager. Sit has continued to maintain
their investment process, and the recent losses are expected to be only
temporary. They paid particular attention to the performance reports prepared
for their considerations by the fund's transfer agent and shareholder service
provider that demonstrated solid relative and absolute performance.
Cost of Services
- ----------------
The trustees made a comparative analysis of the fund's subadvisory fee relative
to similar tax-exempt bond funds as well as other institutional investment
accounts. The trustees noted that management fees charged by most advisers
directly managing a fund's portfolio (i.e. not via hiring a subadviser to manage
the portfolio) also cover significant administrative services not required of
Sit. Sit charges a fee based on assets under management on a sliding scale
ranging from 40 basis points on the first $20 million under management to 20
basis points on assets in excess of $75 million. The management expense as a
percentage of average assets under management in 2008, the time period examined
by the trustees, was 22 basis points or 0.22%. The trustees relied on
presentations by the fund's transfer agent and shareholder servicing provider
comparing Sit's management fee to its relevant peer groups both within the
investment company universe and within the institutional investor universe in
general. Such presentations relied upon published reports from Morningstar. This
analysis led the trustees to determine that the fees charged to the fund were
fair and reasonable in light of the high quality services provided.
Additionally, the trustees relied, in making their decision, on Sit's
representation that no client with a similar account was being charged a lesser
fee. The trustees also noted that the fee charged by Sit when combined with all
other fund expenses resulted in an overall expense ratio to the fund of 0.36% of
average net assets versus the industry average for tax exempt bond mutual funds
of 0.72% according to fund analysis company Morningstar, Inc.
Management Profitability
- ------------------------
The trustees did not consider the profitability of Sit resulting from its
relationship with the fund. The fund's situation is different from that where
the portfolio is managed by the sole adviser, which established, promotes and
markets the fund as a method of increasing its assets under management and,
therefore, its profitability. Sit is an independent firm and the advisory fee
charged is the result of arm's length bargaining between Sit and the fund's
adviser under the supervision of the trustees.
Economies of Scale
- ------------------
The trustees considered whether the fund could enjoy economies of scale as it
grows as a result of Sit realizing economies of scale. They found that there was
some room in the current fee schedule for Sit's fee, as a percentage of assets
under management, to go
down as a growing asset base moves the overall percentage down from the current
22 basis points towards 20 basis points. The trustees determined that further
economies of scale resulting from the relationship with Sit were not a major
consideration given that the relationship is the result of arm's length
bargaining, most of the economies of scale have already been realized and that
the fee is already low-especially in light of the quality of service provided.
Report of Independent Registered Public Accounting Firm
The Board of Trustees and Shareholders
Clearwater Investment Trust:
We have audited the accompanying statements of assets and liabilities, including
the schedules of investments, of Clearwater Growth Fund, Clearwater Small Cap
Fund, and Clearwater Tax-Exempt Bond Fund (funds within Clearwater Investment
Trust) (the Funds) as of December 31, 2008, and the related statements of
operations for the year then ended, the statements of changes in net assets for
each of the years in the two-year period then ended, and the financial
highlights for each of the years in the five-year period then ended. These
financial statements and financial highlights are the responsibility of the
Funds' management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audits to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. Our procedures included
confirmation of securities owned as of December 31, 2008, by correspondence with
the custodian and brokers or by other appropriate auditing procedures where
replies from brokers were not received. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Clearwater Growth Fund, Clearwater Small Cap Fund, and Clearwater Tax-Exempt
Bond Fund as of December 31, 2008, the results of their operations for the year
then ended, the changes in their net assets for each of the years in the
two-year period then ended, and the financial highlights for each of the years
in the five-year period then ended, in conformity with U.S. generally accepted
accounting principles.
/s/ KPMG LLP
Minneapolis, Minnesota
February 27, 2009
CLEARWATER INVESTMENT TRUST
Statements of Assets and Liabilities
December 31, 2008
Growth Small Cap Tax-Exempt
Fund Fund Bond Fund
------------- ------------- -------------
Assets
Investments in securities, at fair value
(identified cost: $189,802,855 Growth Fund;
$164,466,965 Small Cap Fund; $444,539,532
Tax-Exempt Bond Fund) $ 196,738,621 123,935,982 368,520,387
Cash in bank on demand deposit -- 318,400 --
Receivable for securities sold 4,768,278 2,422,263 --
Receivable for fund shares sold 140,300 -- --
Accrued dividend and interest receivable, less
the allowance for uncollectible interest
of $575,025 (Tax-Exempt Bond Fund) 442,191 140,752 5,674,104
------------- ------------- -------------
Total assets 202,089,390 126,817,397 374,194,491
------------- ------------- -------------
Liabilities
Disbursements in excess of cash balances -- -- 207
Payables for investment securities purchased 2,043,428 1,120,594 447,722
Payables for fund shares redeemed 2,636,721 4,539,041 2,533,661
Accrued investment advisory fee 146,365 311,637 364,928
------------- ------------- -------------
Total liabilities 4,826,514 5,971,272 3,346,518
------------- ------------- -------------
Net assets $ 197,262,876 120,846,125 370,847,973
============= ============= =============
Capital
Capital stock and additional paid-in capital
(authorized unlimited number of shares at
no par value for each Fund: outstanding
10,604,152; 11,633,098; and 45,835,014
shares, respectively) $ 199,789,022 194,505,595 451,837,287
Undistributed net investment income 52,082 12,224 24,490
Accumulated net realized loss (9,513,994) (33,140,711) (4,994,659)
Unrealized appreciation (depreciation) of
investments 6,935,766 (40,530,983) (76,019,145)
------------- ------------- -------------
Net assets $ 197,262,876 120,846,125 370,847,973
============= ============= =============
Net asset value per share of outstanding
capital stock $ 18.60 10.39 8.09
See accompanying notes to financial statements.
2
CLEARWATER INVESTMENT TRUST
Statements of Operations
Year ended December 31, 2008
Growth Small Cap Tax-Exempt
Fund Fund Bond Fund
-------------- ------------ ------------
Investment income:
Income:
Dividends (net of foreign taxes withheld
of $3,337, $684, and $0, respectively) $ 6,143,980 2,340,199 1,311,620
Interest 46,092 188,928 18,413,777
-------------- ------------ ------------
Total income 6,190,072 2,529,127 19,725,397
-------------- ------------ ------------
Expenses:
Investment advisory fee 1,265,420 2,664,003 2,194,532
Voluntary fee reduction (478,048) (766,999) (860,754)
-------------- ------------ ------------
Total net expenses 787,372 1,897,004 1,333,778
-------------- ------------ ------------
Net investment income 5,402,700 632,123 18,391,619
-------------- ------------ ------------
Realized and unrealized gain (loss) on investments:
Net realized gain (loss) on security transactions (3,244,756) (33,071,302) (3,472,572)
Unrealized appreciation (depreciation) during
the period (129,750,015) (50,669,506) (64,059,902)
-------------- ------------ ------------
Net gain (loss) on investments (132,994,771) (83,740,808) (67,532,474)
-------------- ------------ ------------
Net decrease in net assets
from operations $ (127,592,071) (83,108,685) (49,140,855)
============== ============ ============
See accompanying notes to financial statements.
3
CLEARWATER INVESTMENT TRUST
Statements of Changes in Net Assets
Years ended December 31, 2008 and 2007
Growth Fund Small Cap Fund Tax-Exempt Bond Fund
--------------------------- -------------------------- -------------------------
2008 2007 2008 2007 2008 2007
------------- ----------- ------------ ----------- ----------- -----------
Operations:
Net investment income (loss) $ 5,402,700 5,170,839 632,123 (12,960) 18,391,619 14,886,778
Net realized gain (loss) on investments (3,244,756) 136,985 (33,071,302) 34,784,802 (3,472,572) (1,013,835)
Unrealized appreciation (depreciation)
during the period (129,750,015) 10,512,841 (50,669,506) (26,981,490) (64,059,902) (12,377,821)
------------- ----------- ------------ ----------- ----------- -----------
Net increase (decrease) in net
assets from operations (127,592,071) 15,820,665 (83,108,685) 7,790,352 (49,140,855) 1,495,122
------------- ----------- ------------ ----------- ----------- -----------
Distributions to shareholders from:
Net investment income (5,407,889) (5,154,945) (619,899) -- (18,367,129) (14,920,314)
Net realized gain on investments -- -- -- (35,634,818) -- --
------------- ----------- ------------ ----------- ----------- -----------
Total distributions to
shareholders (5,407,889) (5,154,945) (619,899) (35,634,818) (18,367,129) (14,920,314)
------------- ----------- ------------ ----------- ----------- -----------
Capital share transactions:
Proceeds from shares sold 44,225,789 31,313,700 70,802,034 15,529,100 171,622,315 66,006,758
Reinvestment of distributions from net
investment income and gain 5,407,889 5,154,945 619,899 35,634,818 18,367,120 14,920,313
Payments for shares redeemed (50,362,010) (7,656,170) (113,834,226) (30,178,531) (89,028,497) (13,851,638)
------------- ----------- ------------ ----------- ----------- -----------
Increase (decrease) in net assets
from capital shares transactions (728,332) 28,812,475 (42,412,292) 20,985,387 100,960,938 67,075,433
------------- ----------- ------------ ----------- ----------- -----------
Total increase (decrease) in
net assets (133,728,292) 39,478,195 (126,140,876) (6,859,079) 33,452,954 53,650,241
Net assets:
At the beginning of the year 330,991,168 291,512,973 246,987,001 253,846,080 337,395,019 283,744,778
------------- ----------- ------------ ----------- ----------- -----------
At the end of the year $ 197,262,876 330,991,168 120,846,125 246,987,001 370,847,973 337,395,019
============= =========== ============ =========== =========== ===========
Undistributed net investment income (loss) $ 52,082 57,241 12,224 -- 24,490 (4,179)
See accompanying notes to financial statements.
4
CLEARWATER INVESTMENT TRUST
Notes to Financial Statements
December 31, 2008
(1) Organization
Clearwater Investment Trust (the Trust) was established on January 12,
1987 as a Massachusetts business trust and is registered under the
Investment Company Act of 1940 (as amended) as a diversified open end
management investment company and presently includes three series of
funds: Clearwater Growth Fund, Clearwater Small Cap Fund, and Clearwater
Tax-Exempt Bond Fund (the Funds). The Trust's declaration of trust permits
the Board of Trustees to create additional funds in the future. The
investment objective of the Clearwater Growth and Small Cap Funds is long
term capital growth. The investment objective of the Clearwater Tax-Exempt
Bond Fund is high current income that is exempt from federal income tax,
consistent with preservation of capital.
The Clearwater Growth Fund is passively managed to track but not replicate
the Russell 1000 Index (the Index), an unmanaged, capitalization weighted
index of the largest 1000 public companies in the United States. The Fund
is managed so that its holdings match the holdings of the Index as closely
as possible while attempting to minimize the realization of taxable gains.
This means that the Fund will not buy and sell securities to match changes
in the composition of securities in the Index. Instead, the Fund's
portfolio is adjusted periodically to reflect the holdings and weightings
of the Index, but only after consideration of the Fund's policy to
minimize realization of taxable gains.
The Clearwater Small Cap Fund invests primarily in equity securities of
issuers with market capitalizations, at the time of investment, no greater
than the range of capitalizations of the companies included in the Russell
2000 Index, an unmanaged, capitalization weighted index of the largest
3000 public companies in the United States less the largest 1000 tracked
by the Russell 1000 Index.
The Clearwater Tax-Exempt Bond Fund invests at least 80% of its assets in
municipal securities, which are debt obligations issued by or for the U.S.
states, territories and possessions, and the District of Columbia. The
interest on these securities is generally exempt from regular federal
income tax and may also be exempt from federal alternative minimum tax.
However, the Fund may invest up to 20% of its assets in securities that
generate interest income subject to federal alternative minimum tax.
(2) Summary of Significant Accounting Policies
The significant accounting policies followed by the Funds are as follows:
(a) Investments in Securities
Investments in equity securities are valued at the last sales price
on the principal exchange or market where they are traded. Equity
securities which have not traded on the date of valuation or
securities for which sales prices are not generally reported are
valued at the mean between the last bid and asked prices. Debt
securities maturing more than 60 days from the valuation date are
valued at the market price supplied by an independent pricing
vendor; those securities with maturities of less than 60 days when
acquired, or which subsequently are within 60 days of maturity, are
valued at amortized cost, which approximates fair value. Securities
for which no market quotations are readily available (including
those the trading of which has been suspended) will be valued at
fair value as determined in good faith by the board of trustees,
although the actual computations may be made by persons acting
pursuant to the direction of the board.
5 (Continued)
CLEARWATER INVESTMENT TRUST
Notes to Financial Statements
December 31, 2008
Security transactions are accounted for on the trade date which is
the date the securities are purchased or sold. Realized gains and
losses are calculated on an identified cost basis. Dividend income
is recognized on the ex-dividend date and interest income, including
amortization of original issue discount and premium, is accrued
daily.
(b) Federal Taxes
The Trust's policy is to comply with the requirements of the
Internal Revenue Code applicable to regulated investment companies.
On a calendar-year basis, the Funds intend to distribute
substantially all of their net investment income and realized gains,
if any, to avoid the payment of federal income and excise taxes.
Therefore, no income tax provision is required. Each fund is treated
as a separate entity for federal income tax purposes.
Financial Accounting Standards Board (FASB) Interpretation 48 (FIN
48), "Accounting for Uncertainty in Income Taxes," clarifies the
accounting for uncertainty in income taxes recognized in accordance
with FASB Statement 109, "Accounting for Income Taxes." FIN 48
provides guidance for how uncertain tax positions should be
recognized, measured, presented, and disclosed in the financial
statements. Management has analyzed the Funds' tax positions taken
on federal tax returns for all open tax years and has concluded that
as of December 31, 2008, no provision for income tax would be
required in the Funds' financial statements. The Funds' federal and
Minnesota state income and federal excise tax returns for the 2005,
2006 and 2007 tax years for which the applicable statutes of
limitations have not expired remain subject to examination by the
Internal Revenue Service and state departments of revenue.
Net investment income and net realized gains (losses) for the Funds
may differ for financial statement and tax purposes. The character
of distributions made during the year from net investment income or
net realized gains may differ from their ultimate characterization
for federal income tax purposes. Also, due to the timing of dividend
distributions, the fiscal year in which amounts are distributed may
differ from the year that the income or realized gains (losses) were
recorded by the Funds. The tax character of distributions paid
during the years ended December 31, 2008 and 2007 was as follows:
Long-term
Tax-Exempt Ordinary Income capital gain
--------------------------------------------------------------------------
2008 2007 2008 2007 2008 2007
---------- ---------- --------- ---------- ---------- ----------
Growth Fund $ -- -- 5,407,889 5,154,945 -- --
Small Cap Fund -- -- 619,899 6,487,523 -- 29,070,454
Tax-Exempt Bond Fund 18,268,358 14,887,748 98,771 32,566 -- --
Return of Capital
-----------------------
2008 2007
---------- ----------
Growth Fund $ -- --
Small Cap Fund -- 76,840
Tax-Exempt Bond Fund -- --
6 (Continued)
CLEARWATER INVESTMENT TRUST
Notes to Financial Statements
December 31, 2008
As of December 31, 2008, the components of distributable earnings on
a tax basis were as follows:
Tax-Exempt
Growth Fund Small Cap Fund Bond Fund
------------ -------------- -----------
Undistributed ordinary income $ 52,082 12,224 3,571
Undistributed tax exempt income -- -- 20,919
Undistributed capital gain -- -- --
Accumulated capital losses (9,227,824) (33,061,735) (4,994,659)
Unrealized appreciation (depreciation) 6,649,596 (40,609,959) (76,019,145)
------------ ----------- -----------
Total $ (2,526,146) (73,659,470) (80,989,314)
============ =========== ===========
On the statements of assets and liabilities, due to permanent
book-to-tax differences, the following adjustments have been made:
Tax-Exempt
Growth Fund Small Cap Fund Bond Fund
------------ -------------- -----------
Undistributed net income $ 30 $ -- $ 4,179
Accumulated net realized gains (28) -- 101
Additional paid-in capital (2) -- (4,280)
(c) Distributions to Shareholders
Distributions to shareholders from net investment income, if any,
are declared annually for the Growth and Small Cap Funds and
declared daily, payable monthly, for the Tax-Exempt Bond Fund.
Distributions to shareholders from net realized gains, if any, are
declared annually for all Funds. Distributions are paid in cash or
reinvested in additional shares.
(d) Use of Estimates
The preparation of financial statements in conformity with U.S.
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of
increase and decrease in net assets from operations during the
period. Actual results could differ from those estimates.
(3) Fair Value Measurements
The Funds adopted Statement of Financial Accounting Standards No. 157,
Fair Value Measurements (SFAS 157), effective January 1, 2008, which
governs the application of generally accepted accounting principles that
require fair value measurements of the Funds' assets and liabilities. Fair
value is an estimate of the price the Funds would receive upon selling a
security in a timely transaction to an independent buyer in the principal
or most advantageous market of the security. SFAS 157 establishes a
three-tier hierarchy to maximize the use of observable market data and
minimize the use of unobservable inputs and to establish classification of
fair value measurements for disclosure purposes. Various inputs are used
in determining
7 (Continued)
CLEARWATER INVESTMENT TRUST
Notes to Financial Statements
December 31, 2008
the value of the Funds' investments, as described in note 2(a) above.
These inputs are summarized in the three broad levels listed below.
o Level 1 - quoted prices in active markets for identical
securities
o Level 2 - other significant observable inputs
o Level 3 - significant unobservable inputs (including the
Funds' own assumptions in determining fair value of
investments)
The following is a summary of the Funds' assets that are measured at fair
value at December 31, 2008, aggregated by the level in the fair value
hierarchy within which those measurements fall:
Growth Small Cap Tax-Exempt
Fund Fund Bond Fund
------------ -------------------------
Level 1 $196,738,621 123,935,982 24,819,403
Level 2 -- -- 343,700,984
Level 3 -- -- --
------------ -------------------------
Total $196,738,621 123,935,982 368,520,387
============ =========================
There were no level three securities held during the period ended December
31, 2008.
(4) Investment Security Transactions
The cost of purchases and proceeds from sales of securities, other than
temporary investments in short term securities, for the year ended
December 31, 2008, were as follows:
Purchases Sales
------------ -----------
Growth Fund $ 44,842,555 45,350,768
Small Cap Fund 224,760,702 260,323,911
Tax-Exempt Bond Fund 213,626,256 113,926,742
(5) Capital Share Transactions
Transactions in shares of each fund for the years ended December 31, 2008
and 2007 were as follows:
Growth Fund Small Cap Fund Tax-Exempt Bond Fund
------------------------ ----------------------- ------------------------
2008 2007 2008 2007 2008 2007
------------ --------- ---------- ---------- ----------- ----------
Sold $ 1,825,122 1,013,940 5,527,593 784,046 19,251,653 6,665,005
Issued for reinvested distributions 290,747 168,628 59,663 2,136,380 2,036,379 1,508,770
Redeemed (2,338,433) (247,568) (8,764,097) (1,680,388) (10,437,584) (1,399,865)
------------ --------- ---------- ---------- ----------- ----------
Increase (decrease) $ (222,564) 935,000 (3,176,841) 1,240,038 10,850,448 6,773,910
============ ========= ========== ========== =========== ==========
8 (Continued)
CLEARWATER INVESTMENT TRUST
Notes to Financial Statements
December 31, 2008
(6) Capital Loss Carry Over
For federal income tax purposes, the Growth Fund, Small Cap Fund, and
Tax-Exempt Bond Fund have capital loss carryovers of $9,227,824,
$33,061,736 and $4,994,659, respectively, at December 31, 2008, which, if
not offset by subsequent capital gains, will expire as follows:
Small Cap Tax-Exempt
Growth Fund Fund Bond Fund
----------- ----------- -------------
Year of expiration:
2010 $ 5,878,353 -- --
2012 -- -- --
2013 183,070 -- 508,252
2014 -- -- --
2015 -- -- 1,013,836
2016 3,166,401 33,061,735 3,472,571
----------- ----------- -------------
Total $ 9,227,824 33,061,735 4,994,659
=========== =========== =============
(7) Expenses and Related-Party Transactions
The Trust has a contract for investment advisory services with Clearwater
Management Company (CMC), a management firm of which the Trust's President
and Treasurer is a shareholder. Under terms of an agreement, Clearwater
Growth Fund, Clearwater Small Cap Fund, and Clearwater Tax-Exempt Bond
Fund pay a fee equal to an annual rate of 0.45%, 1.35%, and 0.60% of
average net assets, respectively. CMC is responsible for the payment or
reimbursement of all the Funds' expenses, except brokerage, taxes,
interest, and extraordinary expenses. On July 1, 2002 CMC voluntarily
reduced the fees paid by the funds to 0.39%, 1.33%, and 0.56%,
respectively. Effective April 1, 2004 CMC made an additional voluntary fee
reduction to 0.37%, 1.20%, and 0.50%, respectively. Effective April 1,
2005 CMC voluntarily reduced the fees paid by the funds to 0.35%, 1.12%,
and 0.47%, respectively. Effective April 1, 2006 CMC voluntarily reduced
the fees paid by the funds to 0.30%, 1.00%, and 0.41%, respectively.
Effective April 1, 2007 CMC voluntarily reduced the fees paid by the funds
to 0.28%, 0.97%, and 0.37%, respectively. Effective July 1, 2008 CMC
voluntarily reduced the fees paid by the Clearwater Small Cap Fund and
Clearwater Tax-Exempt Bond Fund funds to 0.95% and 0.36%, respectively.
These voluntary fee reductions may be discontinued at any time.
CMC has entered into sub advisory contracts with independent investment
advisory firms for each fund to provide daily investment management
services. The sub advisory fee for the Clearwater Growth Fund, payable to
Parametric Portfolio Associates, is equal to an annual rate of 0.15% of
net assets. The subadvisory fee for the Clearwater Small Cap Fund, payable
to Kennedy Capital Management, Inc., is equal to an annual rate of 0.85%
of the first $50 million in net assets it manages and then decreasing to
0.80% of net assets in excess of $50 million. The subadvisory fee for the
Clearwater Small Cap Fund, payable to Keeley Asset Management, is equal to
an annual rate of 1.00% of the first $2 million in net assets it manages,
decreasing to 0.85% on the next $8 million in net assets, and further
decreasing to 0.70% of net assets in excess of $10 million. The
subadvisory fee for the Clearwater Tax-Exempt Bond Fund, payable to Sit
Fixed Income Advisers II, LLC, is equal to an annual rate of 0.40% on the
first $20 million in net assets and then decreasing in reduced percentages
to 0.20% of net assets in excess of $75 million.
9 (Continued)
CLEARWATER INVESTMENT TRUST
Notes to Financial Statements
December 31, 2008
(8) Financial Highlights
Per share data (rounded to the nearest cent) for a share of capital stock
outstanding throughout the years and selected information for each year is
as follows:
Year ended December 31,
------------------------------------------------------
Growth Fund 2008 2007 2006 2005 2004
- --------------------------------------------------------- --------- -------- -------- -------- --------
Net asset value, beginning of year $ 30.57 29.47 26.03 24.93 22.66
Income from investment operations:
Net investment income 0.51 0.48 0.40 0.37 0.38
Net realized and unrealized gain (loss) (11.96) 1.10 3.44 1.10 2.24
--------- -------- -------- -------- --------
Total from investment operations (11.45) 1.58 3.84 1.47 2.62
--------- -------- -------- -------- --------
Less distributions:
Dividends from net investment income (0.52) (0.48) (0.40) (0.37) (0.35)
Distributions from net realized gains -- -- -- -- --
--------- -------- -------- -------- --------
Total distributions (0.52) (0.48) (0.40) (0.37) (0.35)
--------- -------- -------- -------- --------
Net asset value, end of year $ 18.60 30.57 29.47 26.03 24.93
========= ======== ======== ======== ========
Total return (a) (37.5)% 5.4% 14.8% 5.9% 11.5%
Net assets, end of year (000s omitted) $ 197,263 330,991 291,513 229,371 202,580
Ratio of expenses to average net assets (b) ( c) 0.28% 0.28% 0.31% 0.36% 0.37%
Ratio of net investment income to average net assets (b) 1.92% 1.61% 1.56% 1.52% 1.62%
Portfolio turnover rate (excluding short-term securities) 14.71% 17.99% 5.24% 5.80% 1.52%
(a) Total return figures are based on the change in net asset value of a share
during the period and assume reinvestment of distributions at net asset
value.
(b) Total fund expenses are contractually limited to 0.45% of average daily
net assets. However, during the years ended December 31, 2008, 2007, 2006,
2005, and 2004, the investment advisor voluntarily reduced management fees
otherwise payable by the Funds. Had the Funds incurred these expenses, the
ratio of expenses to average daily net assets would have been 0.45%,
0.45%, 0.45%, 0.45%, and 0.45%, for the years ended December 31, 2008,
2007, 2006, 2005, and 2004, respectively, and the ratio of net investment
income to average daily net assets would have been 1.75%, 1.44%, 1.42%,
1.43%, and 1.54%, respectively.
(c) In addition to fees and expenses which the Fund bears directly, the Fund
indirectly bears a pro rata share of the fees and expenses of the acquired
funds in which it invests. Such indirect expenses are not included in the
above reported expense ratios.
10 (Continued)
CLEARWATER INVESTMENT TRUST
Notes to Financial Statements
December 31, 2008
Year ended December 31,
------------------------------------------------------
Small Cap Fund 2008 2007 2006 2005 2004
- --------------------------------------------------------- --------- -------- -------- -------- --------
Net asset value, beginning of year $ 16.68 18.71 18.09 19.14 18.35
Income from investment operations:
Net investment income (loss) 0.05 -- (0.04) (0.04) (0.09)
Net realized and unrealized gains (losses) (6.29) 0.58 3.13 1.81 3.92
--------- -------- -------- -------- --------
Total from investment operations (6.24) 0.58 3.09 1.77 3.83
--------- -------- -------- -------- --------
Less distributions:
Distributions from net investment income (0.05) -- -- -- --
Distributions from net realized gains -- (2.61) (2.47) (2.82) (3.04)
--------- -------- -------- -------- --------
Total distributions (0.05) (2.61) (2.47) (2.82) (3.04)
--------- -------- -------- -------- --------
Net asset value, end of year $ 10.39 16.68 18.71 18.09 19.14
========= ======== ======== ======== ========
Total return (a) (37.4)% 3.1% 17.1% 9.2% 20.9%
Net assets, end of year (000s omitted) $ 120,846 246,987 253,846 203,351 213,273
Ratio of expenses to average net assets (b) (c) 0.95% 0.98% 1.03% 1.14% 1.24%
Ratio of net investment income (loss) to average net
assets (b) 0.32% --% (0.23)% (0.19)% (0.45)%
Portfolio turnover rate (excluding short-term securities) 117.12% 115.19% 69.57% 73.65% 83.25%
(a) Total return figures are based on the change in net asset value of a share
during the period and assume reinvestment of distributions at net asset
value.
(b) Total fund expenses are contractually limited to 1.35% of average daily
net assets. However, during the years ended December 31, 2008, 2007, 2006,
2005, and 2004, the investment advisor voluntarily reduced management fees
otherwise payable by the Funds. Had the Funds incurred these expenses, the
ratio of expenses to average daily net assets would have been 1.35%,
1.35%, 1.35%, 1.35%, and 1.35%, for the years ended December 31, 2008,
2007, 2006, 2005, and 2004, respectively, and the ratio of net investment
income (loss) to average daily net assets would have been (.08)%, (0.37)%,
(0.55)%, (0.40)%, and (0.56)%, respectively.
(c) In addition to fees and expenses which the Fund bears directly, the Fund
indirectly bears a pro rata share of the fees and expenses of the acquired
funds in which it invests. Such indirect expenses are not included in the
above reported expense ratios.
11 (Continued)
CLEARWATER INVESTMENT TRUST
Notes to Financial Statements
December 31, 2008
Year ended December 31
Tax-Exempt ------------------------------------------------------
Bond Fund 2008 2007 2006 2005 2004
- --------------------------------------------------------- --------- -------- -------- -------- --------
Net asset value, beginning of year $ 9.64 10.06 10.00 10.03 10.12
Income from investment operations:
Net investment income 0.46 0.46 0.43 0.48 0.50
Net realized and unrealized gains (1.55) (0.42) 0.06 (0.03) (0.10)
--------- -------- -------- -------- --------
Total from investment operations (1.09) 0.04 0.49 0.45 0.40
--------- -------- -------- -------- --------
Less distributions:
Distributions from net investment income (0.46) (0.46) (0.43) (0.48) (0.49)
Distributions from net realized gains -- -- -- -- --
--------- -------- -------- -------- --------
Total distributions (0.46) (0.46) (0.43) (0.48) (0.49)
--------- -------- -------- -------- --------
Net asset value, end of year $ 8.09 9.64 10.06 10.00 10.03
========= ======== ======== ======== ========
Total return (a) (11.80)% 0.60% 5.3% 4.6% 4.1%
Net assets, end of year (000s omitted) $ 370,848 337,395 283,745 225,476 188,677
Ratio of expenses to average net assets (b) (c) 0.37% 0.38% 0.42% 0.48% 0.51%
Ratio of net investment income to average net assets (b) 5.03% 4.75% 4.66% 4.77% 4.84%
Portfolio turnover rate (excluding short-term securities) 32.20% 27.58% 40.20% 41.39% 35.25%
(a) Total return figures are based on the change in net asset value of a share
during the period and assume reinvestment of distributions at net asset
value.
(b) Total fund expenses are contractually limited to 0.60% of average daily
net assets. However, during the years ended December 31, 2008, 2007, 2006,
2005, and 2004 the investment advisor voluntarily reduced management fees
otherwise payable by the Funds. Had the Funds incurred these expenses, the
ratio of expenses to average daily net assets would have been 0.60%,
0.60%, 0.60%, 0.60%, and 0.60%, for the years ended December 31, 2008,
2007, 2006, 2005, and 2004, respectively, and the ratio of net investment
income to average daily net assets would have been 4.80%, 4.53%, 4.48%,
4.65%, and 4.75%, respectively.
(c) In addition to fees and expenses which the Fund bears directly, the Fund
indirectly bears a pro rata share of the fees and expenses of the acquired
funds in which it invests. Such indirect expenses are not included in the
above reported expense ratios.
12
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Common stocks:
Consumer discretionary:
2,300 ABERCROMBIE + FITCH CO $ 50,218 53,061
1,809 ACCO BRANDS CORP 16,591 6,241
2,900 ADVANCE AUTO PARTS 103,545 97,585
6,950 AMAZON COM INC (b) 323,198 356,396
10,050 AMERICAN EAGLE OUTFITTERS INC 100,802 94,068
900 AMERICAN GREETINGS CORP 13,869 6,813
229 ASCENT MEDIA CORP (b) 5,300 5,001
1,700 AUTOLIV 69,331 36,482
1,400 AUTOZONE INC (b) 134,557 195,258
5,475 BED BATH + BEYOND INC (b) 181,359 139,175
1,250 BELO CORP 14,941 1,950
7,650 BEST BUY CO INC 210,571 215,042
1,400 BIG LOTS INC (b) 15,477 20,286
1,300 BLACK + DECKER CORPORATION 44,208 54,353
3,800 BORG WARNER INC 107,106 82,726
1,950 BRINKER INTL INC 41,847 20,553
8,300 BROCADE COMMUNICATIONS SYS INC (b) 52,215 23,240
6,400 CABLEVISION SYS CORP 104,096 107,776
5,468 CARMAX INC (b) 78,791 43,088
9,600 CARNIVAL CORP 318,908 233,472
9,343 CBS CORP CLASS B 242,763 76,519
19,275 CLEAR CHANNEL OUTDOOR HLDGS IN (b) 149,539 118,541
7,500 COACH INC (b) 71,549 155,775
66,567 COMCAST CORP NEW 1,201,630 1,123,651
1,300 COPART INC (b) 32,032 35,347
8,600 COSTCO WHSL CORP NEW 291,902 451,500
13,200 D R HORTON INC 130,608 93,324
2,800 DARDEN RESTAURANTS INC 65,099 78,904
16,123 DIRECTV GROUP INC (b) 245,263 369,378
2,296 DISCOVERYCOMMUNICATIONS INC (b) 30,438 32,511
2,296 DISCOVERYCOMMUNICATIONS INC (b) 27,334 30,743
5,700 DISH NETWORK CORP (b) 174,889 63,213
44,260 DISNEY WALT CO 1,048,422 1,004,259
2,000 DOLBY LABORATORIES INC (b) 43,420 65,520
1,600 DOLLAR TREE INC (b) 39,797 66,880
3,900 EASTMAN KODAK CO 90,363 25,662
6,220 EXPEDIA INC DEL (b) 124,528 51,253
766 EW SCRIPPS CO OH (b) 7,582 1,693
6,300 FAMILY DLR STORES INC 159,422 164,241
3,000 FOOT LOCKER INC 40,394 22,020
37,863 FORD MTR CO DEL (b) 271,334 86,706
4,300 FORTUNE BRANDS INC 149,332 177,504
3,800 GAMESTOP CORP NEW (b) 15,311 82,308
10,000 GANNETT INC 211,212 80,000
14,300 GAP INC 234,156 191,477
1,600 GARMIN LTD 72,406 30,672
15,400 GENERAL MTRS CORP (b) 213,830 49,280
9,200 GENTEX CORP 131,306 81,236
4,200 GOODYEAR TIRE AND RUBBER (b) 114,093 25,074
6,081 HANESBRANDS INC (b) 171,664 77,533
7,150 HARLEY DAVIDSON INC 41,890 121,336
7,050 HEARST ARGYLE TELEVISION INC 169,510 42,723
4,600 HERTZ GLOBAL HLDGS INC (b) 46,429 23,322
33,825 HOME DEPOT INC 22,060 778,652
1,084 HSN INC DEL (b) 20,274 7,881
5,300 INTERNATIONAL GAME TECHNOLOGY 181,663 63,017
24,200 INTERPUBLIC GROUP COS INC (b) 87,279 95,832
644 INTERVAL LEISURE GROUP INC (b) 12,087 3,471
See accompanying notes to financial statements. 13 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Consumer discretionary (Cont'd):
5,300 J C PENNEY INC $ 210,583 104,410
14,050 JOHNSON CTLS INC 283,752 255,148
1,200 KB HOME (b) 31,938 16,344
6,950 KOHLS CORP (b) 55,509 251,590
700 LAMAR ADVERTISING CO (b) 26,224 8,792
1,300 LEAR CORP (b) 21,307 1,833
1,100 LEGGETT +PLATT INC 23,652 16,709
10,437 LIBERTY MEDIA CORP NEW - INTERACTIVE (b) 168,746 32,563
3,331 LIBERTY MEDIA CORP NEW - CAPTIAL (b) 34,332 15,689
10,524 LIBERTY MEDIA CORP NEW - SERIES A (b) 132,977 183,960
10,290 LIMITED BRANDS INC 118,493 103,312
34,800 LOWES COSINC 697,346 748,896
6,200 MACYS INC 143,111 64,170
10,300 MARRIOTT INTL INC NEW 42,474 200,335
8,700 MATTEL INC 164,712 139,200
23,800 MCDONALDSCORP 711,646 1,480,122
7,290 MCGRAW HILL COS INC 279,379 169,055
2,900 MOHAWK INDS INC (b) 216,361 124,613
4,200 NEWELL RUBBERMAID INC 97,738 41,076
43,775 NEWS CORP 678,724 397,915
7,000 NIKE INC 251,483 357,000
7,700 NORDSTROMINC 152,957 102,487
4,500 OFFICE DEPOT INC (b) 65,209 13,410
7,495 OMNICOM GROUP 278,273 201,765
2,500 PENN NATLGAMING INC (b) 97,645 53,450
1,300 PETSMART INC 33,146 23,985
1,500 POLO RALPH LAUREN CORP 31,320 68,115
700 PRICELINECOM INC (b) 92,103 51,555
7,500 PULTE HOMES INC (b) 77,063 81,975
3,000 REGAL ENTMT GROUP 55,920 30,630
2,300 ROSS STORES INC 36,395 68,379
2,600 RYLAND GROUP INC 71,175 45,942
1,000 SCHOLASTIC CORP 28,560 13,580
2,300 SCRIPPS NETWORKS INTERACTIVE I 91,239 50,600
1,227 SEARS HLDGS CORP (b) 78,518 47,693
1,300 SHERWIN WILLIAMS CO 62,645 77,675
3,027 SIRIUS XMRADIO INC (b) 6,840 363
1,400 SNAP ON INC 52,729 55,132
2,900 STANLEY WORKS 129,263 98,890
16,250 STAPLES INC 264,742 291,200
19,650 STARBUCKSCORP (b) 279,363 185,889
5,010 STARWOOD HOTELS + RESORTS INC 224,617 89,679
19,100 TARGET CORP 700,947 659,523
644 TICKETMASTER (b) 19,048 4,134
3,000 TIFFANY +CO NEW 86,618 70,890
6,133 TIM HORTONS INC 136,187 176,876
71,300 TIME WARNER INC NEW 918,341 717,278
8,447 TJX COS INC NEW 160,244 173,755
5,500 TOLL BROSINC (b) 124,557 117,865
800 TRW AUTOMOTIVE HLDGS CORP (b) 18,216 2,880
2,057 UNITED RENTALS INC (b) 39,425 18,760
3,227 URBAN OUTFITTERS INC (b) 61,562 48,340
2,300 V F CORP 135,032 125,971
12,556 VIACOM INC NEW (b) 511,922 239,317
4,100 VIRGIN MEDIA INC 70,268 20,459
1,166 WABCO HLDGS INC 40,995 18,411
49,696 WAL MART STORES INC 2,306,522 2,785,958
9,090 WENDYS/ARBYS GROUP INC 56,673 44,905
1,600 WHIRLPOOLCORP 69,376 66,160
See accompanying notes to financial statements. 14 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Consumer discretionary (Cont'd):
2,200 WILEY JOHN + SONS INC $ 89,428 78,276
5,989 WYNDHAM WORLDWIDE CORP 97,386 39,228
1,100 WYNN RESORTS LTD (b) 51,278 46,486
10,016 YUM BRANDS INC 105,346 315,504
2,400 ZALE CORPNEW (b) 39,515 7,992
------------- -------------
20,808,825 19,985,618 10.13%
Consumer staples:
45,200 ALTRIA GROUP INC 430,921 680,712
14,200 ARCHER DANIELS MIDLAND CO 313,471 409,386
9,362 AVON PRODS INC 275,428 224,969
3,283 BROWN FORMAN CORP 130,753 169,042
1,800 BUNGE LIMITED 184,419 93,186
6,200 CAMPBELL SOUP CO 168,826 186,062
4,000 CLOROX CO 229,721 222,240
49,959 COCA COLA CO 1,919,175 2,261,644
13,000 COCA COLAENTERPRISES INC 277,718 156,390
11,790 COLGATE PALMOLIVE CO 694,115 808,087
8,400 CONAGRA INC 191,907 138,600
33,122 CVS CAREMARK CORP 658,181 951,926
5,773 DEL MONTEFOODS CO 57,723 41,219
6,000 DR PEPPERSNAPPLE GROUP INC (b) 125,060 97,500
7,200 GENERAL MLS INC 334,431 437,400
1,600 HANSEN NAT CORP (b) 61,969 53,648
8,075 HEINZ H JCO 303,404 303,620
2,000 HERSHEY CO / THE 79,040 69,480
3,100 HORMEL FOODS CORP 111,616 96,348
5,800 KELLOGG CO 268,705 254,330
10,350 KIMBERLY CLARK CORP 615,872 545,859
29,338 KRAFT FOODS INC 512,603 787,725
16,500 KROGER CO 302,529 435,765
1,867 LAUDER ESTEE COS INC 70,634 57,802
4,100 LORILLARDINC 107,638 231,035
2,800 MCCORMICK+ CO INC 97,399 89,208
3,200 MOLSON COORS BREWING CO 125,165 156,544
1,000 NBTY INC (b) 21,300 15,650
3,700 PEPSI BOTTLING GROUP INC 103,155 83,287
35,226 PEPSICO INC 1,511,021 1,929,328
45,900 PHILIP MORRIS INTL ORD SHR 856,107 1,997,109
65,839 PROCTER AND GAMBLE CO 1,736,767 4,070,167
9,819 SAFEWAY INC 212,761 233,398
12,350 SARA LEE CORP 200,173 120,907
5,400 SMITHFIELD FOODS INC (b) 108,846 75,978
1,400 SMUCKER JM CO 64,533 60,704
4,606 SUPERVALUINC 89,569 67,248
11,300 SYSCO CORP 230,766 259,222
2,100 TERRA INDS INC 102,659 35,007
9,527 TYSON FOODS INC (DEL) 111,286 83,457
2,554 UST INC 132,498 177,197
25,150 WALGREEN CO 299,045 620,451
7,600 WHOLE FOODS MKT INC (b) 176,927 71,744
------------- -------------
14,605,832 19,860,578 10.07%
Energy:
9,846 ANADARKO PETE CORP 402,657 379,563
8,434 APACHE CORP 376,498 628,586
6,800 BAKER HUGHES INC 413,255 218,076
12,500 BJ SVCS CO 297,345 145,875
1,804 CABOT OIL+ GAS CORP 57,973 46,904
4,900 CAMERON INTL CORP (b) 189,035 100,450
16,686 CHESAPEAKE ENERGY CORP 404,571 269,813
See accompanying notes to financial statements. 15 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Energy (Cont'd):
44,495 CHEVRON CORP $ 2,197,356 3,291,295
2,800 CIMAREX ENERGY CO 154,862 74,984
33,144 CONOCOPHILLIPS 1,101,446 1,716,859
2,000 CONTINENTAL RES INC OK (b) 73,772 41,420
9,300 DENBURY RES INC (b) 88,955 101,556
9,823 DEVON ENERGY CORPORATION NEW 489,869 645,469
600 DIAMOND OFFSHORE DRILLING INC 83,493 35,364
4,100 DRESSER RAND GROUP INC (b) 134,747 70,725
13,900 EL PASO CORP 103,337 108,837
1,200 ENCORE AQUISITION CO (b) 85,206 30,624
4,554 ENSCO INTL INC 193,114 129,288
4,500 EOG RESOURCES INC 42,789 299,610
4,000 EQUITABLERES INC 132,900 134,200
116,983 EXXON MOBIL CORP 5,389,170 9,338,753
2,000 FMC TECHNOLOGIES INC (b) 104,383 47,660
900 FOREST OIL CORP (b) 63,743 14,841
20,158 HALLIBURTON CO 464,616 366,472
5,600 HELMERICHAND PAYNE INC 72,586 127,400
5,900 HESS CORP 446,457 316,476
12,386 MARATHON OIL CORP 336,738 338,881
2,800 MURPHY OIL CORP 60,761 124,180
5,400 NABORS INDUSTRIES LTD 164,133 64,638
10,722 NATIONAL OILWELL VARCO INC (b) 326,348 262,046
5,142 NEWFIELD EXPL CO (b) 222,527 101,555
6,000 NOBLE CORPORATION 295,985 132,540
4,700 NOBLE ENERGY INC 59,008 231,334
16,614 OCCIDENTAL PETE CORP 155,865 996,674
2,000 OCEANEERING INTL INC (b) 102,370 58,280
900 OIL STATES INTL INC (b) 54,464 16,821
7,700 PATTERSONUTI ENERGY INC 157,042 88,627
3,200 PIONEER NAT RES CO 48,507 51,776
5,600 PRIDE INTERNATIONAL INC (b) 188,739 89,488
5,810 QUICKSILVER RES INC (b) 119,305 32,362
2,300 RANGE RESCORP 115,573 79,097
1,100 ROWAN COSINC 50,419 17,490
4,000 SANDRIDGEENERGY IN (b) 34,380 24,600
25,300 SCHLUMBERGER LTD 1,455,952 1,070,949
4,900 SMITH INTL INC 162,363 112,161
3,200 SUNOCO INC 36,080 139,072
4,700 SUPERIOR ENERGY SVCS INC (b) 169,835 74,871
1,800 TESORO CORP 42,248 23,706
3,300 TETRA TECHNOLOGIES INC DEL (b) 68,507 16,038
2,300 TIDEWATERINC 118,715 92,621
11,444 VALERO ENERGY CORP 242,958 247,648
17,400 WEATHERFORD INTERNATIONAL LTD 495,033 188,268
2,000 WHITING PETE CORP NEW (b) 166,142 66,920
13,675 WILLIAMS COS INC 253,252 198,014
9,746 XTO ENERGY INC 336,514 343,741
------------- -------------
19,603,891 23,965,498 12.15%
Financials:
1,300 ACE LIMITED 80,746 68,796
11,750 AFLAC INC 439,738 538,620
7,800 ALLIED CAP CORP NEW 169,385 20,982
2,700 ALLIED WORLD ASSURANCE COMPANY 86,630 109,620
12,300 ALLSTATE CORP 547,785 402,948
4,829 AMB PPTY CORP 162,795 113,095
21,333 AMERICAN EXPRESS CO 815,984 395,727
111 AMERICAN INTL GROUP INC (b) 2,800 174
2,700 AMERICREDIT CORP (b) 31,865 20,628
See accompanying notes to financial statements. 16 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Financials (Cont'd):
7,391 AMERIPRISE FINL INC $ 288,205 172,654
14,400 ANNALY CAPITAL MANAGEMENT INC 233,405 228,528
6,200 AON CORP 182,416 283,216
2,811 APARTMENTINVT + MGMT CO 87,509 32,467
4,100 ASSOCIATED BANC CORP 116,092 85,813
1,800 ASSURANT INC 119,588 54,000
7,800 ASTORIA FINL CORP 69,146 128,544
1,100 AVALONBAYCMNTYS INC 105,375 66,638
5,100 AXIS CAPITAL HOLDINGS LTD 187,376 148,512
3,400 BANCORPSOUTH INC 62,679 79,424
111,280 BANK AMERCORP 3,437,718 1,566,822
27,101 BANK NEW YORK MELLON CORP 863,705 767,771
12,658 BB+T CORP 372,058 347,589
4,106 BERKLEY WR CORP 128,060 127,286
600 BLACKROCKINC CLA 110,619 80,490
2,988 BOSTON PPTYS INC 285,378 164,340
6,500 BRANDYWINE RLTY TR 107,015 50,115
3,080 BROADRIDGE FINL SOLUTIONS INC 52,817 38,623
6,847 CAPITAL ONE FINL CORP 274,221 218,351
11,200 CAPITALSOURCE INC 65,275 51,744
3,700 CB RICHARD ELLIS GROUP INC (b) 84,241 15,984
14,500 CBL + ASSOC PPTYS INC 134,053 94,250
9,000 CHUBB CORP 420,411 459,000
2,756 CINCINNATI FINL CORP 103,501 80,117
1,100 CIT GROUPINC NEW 17,463 4,994
108,915 CITIGROUPINC 2,090,539 730,820
1,573 CME GROUPINC 638,516 327,357
4,600 COMERICA INC 233,547 91,310
1,500 DIGITAL RLTY TR INC 60,188 49,275
9,887 DISCOVER FINL SVCS 148,722 94,223
2,500 DUKE RLTYCORP 66,038 27,400
15,500 E TRADE FINL CORP (b) 56,033 17,825
1,300 EAST WESTBANCORP INC 18,831 20,761
5,416 EQUITY RESIDENTIAL 174,162 161,505
2,900 ERIE INDTY CO 151,861 109,127
2,400 EVEREST REINSURANCE GROUP LTD 184,908 182,736
17,950 FEDERAL HOME LN MTG CORP (b) 54,545 13,104
4,281 FIDELITY NATL FINL INC 72,081 75,988
4,742 FIDELITY NATL INFORMATION SVC 96,711 77,152
3,000 FIFTH THIRD BANCORP 32,595 24,780
600 FIRST CTZNS BANCSHARES INC N C 86,506 91,680
9,068 FIRST HORIZON NATL CORP 129,296 95,849
1,200 FOREST CITY ENTERPRISES INC (b) 54,504 8,040
829 FORESTAR REAL ESTATE GROUP INC (b) 20,649 7,892
4,859 FRANKLIN RES INC 89,208 309,907
14,300 FULTON FINL CORP PA 158,276 137,566
4,400 GENWORTH FINL INC (b) 95,523 12,452
10,126 GOLDMAN SACHS GROUP INC 1,083,859 854,533
1 GUARANTY FINL GROUP INC (b) 7 3
1,200 HANOVER INS GROUP INC 51,342 51,564
4,700 HARTFORD FINANCIAL SVCS GRP 259,891 77,174
7,100 HCP INC 118,485 197,167
4,000 HEALTH CARE REIT INC 162,580 168,800
13,067 HOST HOTELS + RESORTS INC 238,041 98,917
6,400 HRPT PPTYS TR 56,139 21,568
10,500 HUDSON CITY BANCORP INC 166,268 167,580
8,300 HUNTINGTON BANCSHARES INC 77,106 63,578
1,900 INTERCONTINENTALEXCHANGE INC (b) 304,918 156,636
6,300 INVESCO LTD 169,355 90,972
See accompanying notes to financial statements. 17 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Financials (Cont'd):
4,400 JANUS CAPGROUP INC $ 64,273 35,332
81,440 JPMORGAN CHASE + CO 2,607,452 2,567,803
15,200 KEYCORP NEW 300,120 129,504
5,301 KIMCO RLTY CORP 179,509 96,902
6,152 LEGG MASON INC 147,960 134,790
3,500 LEUCADIA NATL CORP 126,468 69,300
6,948 LINCOLN NATL CORP IN 251,421 130,900
3,700 LOEWS CORP 123,584 104,525
1,060 M + T BK CORP 90,056 60,855
5,400 MACK CA RLTY CORP 169,534 132,300
4,704 MANULIFE FINL CORP 68,320 80,109
11,478 MARSH + MCLENNAN COS INC 302,955 278,571
4,699 MARSHALL + ILSLEY CORP NEW 98,962 64,094
41,053 MERRILL LYNCH + CO INC 1,417,158 477,857
9,300 METLIFE INC 403,296 324,198
3,000 MF GLOBALLTD 34,695 6,120
5,700 MGIC INVTCORP WIS (b) 27,845 19,836
4,400 MOODYS CORP 173,138 88,396
26,360 MORGAN STANLEY 874,613 422,814
4,500 NASDAQ OMX GROUP INC (b) 139,568 111,195
1,200 NATIONWIDE FINL SVCS INC (b) 49,923 62,652
1,500 NATIONWIDE HEALTH PPTYS INC 48,338 43,080
3,249 NEW YORK CMNTY BANCORP INC 60,019 38,858
6,002 NORTHERN TRUST CORP 315,914 312,944
8,200 NYSE EURONEXT (b) 441,787 224,516
11,825 OLD REP INTL CORP 232,156 140,954
4,100 ONEBEACONINSURANCE GROUP LTD 90,672 42,804
7,623 PEOPLES UTD FINL INC 112,997 135,918
3,485 PLUM CREEK TIMBER CO INC 79,081 121,069
7,225 PNC FINL SVCS GROUP INC 415,080 354,025
15,300 POPULAR INC 151,853 78,948
2,800 PRICE T ROWE GROUP INC 18,906 99,232
4,950 PRINCIPALFINANCIAL GROUP 202,106 111,722
18,348 PROGRESSIVE CORP OHIO 320,780 271,734
4,472 PROLOGIS 184,689 62,116
9,200 PRUDENTIAL FINL INC 390,935 278,392
2,991 PUBLIC STORAGE 238,179 237,785
2,825 RAYMOND JAMES FINANCIAL INC 70,271 48,392
2,700 REALTY INCOME CORP 67,689 62,505
20,599 REGIONS FINL CORP NEW 247,471 163,968
25,200 SCHWAB CHARLES CORP 224,456 407,484
5,126 SIMON PPTY GROUP INC NEW 352,978 272,344
4,800 SL GREEN RLTY CORP 232,789 124,320
8,900 SLM CORP (b) 206,478 79,210
3,810 SOVEREIGNBANCORP INC (b) 27,795 11,354
1,700 ST JOE CO (b) 56,409 41,344
11,435 STATE STREET CORPORATION 576,163 449,739
5,334 SUNTRUST BKS INC 303,416 157,566
9,000 SYNOVUS FINL CORP 99,692 74,700
6,600 TCF FINANCIAL CORP 56,855 90,156
7,566 TD AMERITRADE HLDG CORP (b) 121,495 107,816
2,600 TORCHMARKINC 124,633 116,220
1,070 TORONTO DOMINION BK ONT 64,692 38,381
1,100 TRANSATLANTIC HLDGS INC 71,062 44,066
14,388 TRAVELERSCOS INC 583,417 650,338
180 TREE COM INC (b) 2,025 468
4,000 UNITRIN INC 101,606 63,760
8,900 UNUM GROUP 167,076 165,540
37,585 US BANCORP DEL 920,971 940,001
See accompanying notes to financial statements. 18 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Financials (Cont'd):
5,346 VALLEY NATL BANCORP $ 95,566 108,257
2,900 VENTAS INC 129,094 97,353
9,700 VISA INC 809,898 508,765
2,645 VORNADO RLTY TR 218,703 159,626
29,984 WACHOVIA CORP 2ND NEW 550,316 166,111
81,953 WELLS FARGO + CO NEW 1,248,366 2,415,974
18,044 WESTERN UN CO 160,005 258,751
2,800 WHITNEY HLDG CORP 53,158 44,772
7,225 XL CAPITAL LTD 92,119 26,733
3,500 ZIONS BANCORP 167,964 85,785
------------- -------------
36,806,237 27,567,052 13.97%
Healthcare:
35,235 ABBOTT LABS 1,388,931 1,880,492
12,900 AETNA INC 101,582 367,650
7,286 ALLERGAN INC 331,496 293,772
4,000 AMERISOURCEBERGEN CORP 121,747 142,640
23,050 AMGEN INC (b) 94,309 1,331,138
2,700 AMYLIN PHARMACEUTICALS INC (b) 82,493 29,295
3,300 BARD C R INC 264,405 278,058
15,100 BAXTER INTL INC 469,170 809,209
6,500 BECTON DICKINSON + CO 417,630 444,535
7,850 BIOGEN IDEC INC (b) 108,762 373,896
2,300 BIOMARIN PHARMACEUTICAL INC (b) 67,195 40,940
30,450 BOSTON SCIENTIFIC CORP (b) 399,951 235,683
42,300 BRISTOL MYERS SQUIBB CO 1,048,308 983,475
7,335 CARDINAL HEALTH INC 403,937 252,837
8,536 CELGENE CORP (b) 247,019 471,870
1,200 CEPHALON INC (b) 78,269 92,448
6,600 CIGNA CORP 107,215 111,210
1,400 COVANCE INC (b) 82,457 64,442
2,546 COVENTRY HEALTH CARE INC (b) 100,005 37,884
12,425 COVIDIEN LTD 452,824 450,282
3,225 DAVITA INC (b) 123,269 159,863
1,900 EDWARDS LIFESCIENCES CORP (b) 118,152 104,405
1,200 ENDO PHARMACEUTICALS HLDGS (b) 30,942 31,056
3,100 EXPRESS SCRIPTS INC (b) 103,497 170,438
380 FACET BIOTECH CORP (b) 5,841 3,644
7,250 FOREST LABS INC (b) 275,795 184,658
10,300 GENENTECHINC (b) 570,900 853,973
5,300 GENZYME CORP (b) 330,481 351,761
22,260 GILEAD SCIENCES INC (b) 549,373 1,138,376
10,600 HEALTH MGMT ASSOC (b) 68,741 18,974
2,450 HEALTH NET INC (b) 64,669 26,681
1,300 HILL ROM HLDGS 38,228 21,398
3,700 HILLENBRAND INC 88,840 61,716
6,000 HLTH CORP (b) 58,236 62,760
8,108 HOLOGIC INC (b) 180,379 105,972
6,805 HOSPIRA INC (b) 247,485 182,510
3,900 HUMANA INC (b) 39,107 145,392
2,600 ILLUMINA INC (b) 110,364 67,730
4,400 IMS HEALTH INC 108,416 66,704
800 INTUITIVESURGICAL INC (b) 199,170 101,592
1,800 INVERNESSMED INNOVATIONS INC (b) 57,627 34,038
63,084 JOHNSON +JOHNSON 2,345,424 3,774,316
1,931 KINETIC CONCEPTS INC (b) 71,019 37,037
9,700 KING PHARMACEUTICALS INC (b) 103,405 103,014
3,400 LABORATORY CORP AMER HLDGS (b) 99,252 218,994
5,973 LIFE TECHNOLOGIES CORP (b) 188,036 139,231
21,794 LILLY ELI+ CO (b) 954,591 877,644
See accompanying notes to financial statements. 19 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Healthcare (Cont'd):
1,950 LINCARE HLDGS INC (b) $ 58,492 52,514
6,300 MCKESSON CORP 258,943 243,999
10,756 MEDCO HEALTH SOLUTIONS INC (b) 182,933 450,784
22,550 MEDTRONICINC 84,144 708,521
48,686 MERCK + CO INC 1,656,725 1,480,054
953 MILLIPORECORP (b) 60,735 49,099
6,800 MYLAN INC (b) 81,695 67,252
2,600 PATTERSONCOS INC (b) 87,927 48,750
1,900 PDL BIOPHARMA INC 30,868 11,742
1,800 PERRIGO CO 59,715 58,158
145,575 PFIZER INC 1,240,482 2,578,133
3,400 PHARMACEUTICAL PROD DEV INC 119,843 98,634
3,665 QUEST DIAGNOSTICS INC 147,704 190,250
35,903 SCHERING PLOUGH CORP 672,851 611,428
3,074 SEPRACOR INC (b) 81,275 33,753
12,600 SERVICE CORP INTL 90,438 62,622
7,039 ST JUDE MED INC (b) 200,879 232,005
4,700 STRYKER CORP 18,139 187,765
12,900 TENET HEALTHCARE CORP (b) 56,567 14,835
26,602 UNITEDHEALTH GROUP INC 591,373 707,613
1,268 UNIVERSALHEALTH SVCS INC 67,747 47,639
5,200 VARIAN MED SYS INC (b) 191,672 182,208
2,400 VCA ANTECH INC (b) 71,120 47,712
3,300 VERTEX PHARMACEUTICALS INC (b) 84,680 100,254
2,175 WATSON PHARMACEUTICALS INC (b) 50,706 57,790
1,400 WELLCARE HEALTH PLANS INC (b) 49,539 18,004
11,849 WELLPOINTINC (b) 511,001 499,198
29,967 WYETH 1,252,227 1,124,062
6,874 ZIMMER HOLDINGS INC (b) 454,256 277,847
------------- -------------
22,013,615 27,978,257 14.18%
Industrials:
16,350 3M CO 1,175,090 940,779
4,210 AGCO CORP (b) 174,615 99,314
1,000 ALLIANCE DATA SYSTEMS CORP (b) 56,945 46,530
6,200 AMR CORP DEL (b) 52,778 66,154
2,600 APOLLO GROUP INC (b) 159,671 199,212
1,700 AVERY DENNISON CORP 90,518 55,641
2,000 BE AEROSPACE INC (b) 58,542 15,380
6,200 BLOCK H +R INC 58,017 140,864
18,400 BOEING CO 435,252 785,128
1,300 BUCYRUS INTL INC NEW 96,402 24,076
5,747 BURLINGTON NORTHN SANTA FE 214,383 435,105
3,200 C H ROBINSON WORLDWIDE INC 173,584 176,096
1,600 CAREER EDCORP (b) 26,824 28,704
1,400 CARLISLE COS INC 47,448 28,980
13,904 CATERPILLAR INC 528,647 621,092
3,700 CINTAS CORP 122,389 85,951
2,827 CON WAY INC 101,721 75,198
4,300 CONTINENTAL AIRLS INC (b) 102,190 77,658
3,900 CONVERGYSCORP (b) 69,089 24,999
2,800 COOPER INDUSTRIES LTD 127,796 81,844
1,200 COPA HOLDINGS S A 46,086 36,384
1,700 CORPORATEEXECUTIVE BRD CO 50,737 37,502
4,500 COVANTA HLDG CORP (b) 119,422 98,820
3,948 CRANE CO 66,572 68,064
10,200 CSX CORP 107,400 331,194
6,000 CUMMINS INC 184,025 160,380
5,200 DANAHER CORP 275,625 294,372
9,900 DEERE + CO 379,732 379,368
See accompanying notes to financial statements. 20 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Industrials (Cont'd):
11,850 DELTA AIRLINES INC DE (b) 87,483 135,801
1,978 DEVRY INCDEL 93,134 113,557
36,400 DOMTAR CORP (b) 217,293 60,788
1,600 DONALDSONCO INC 63,715 53,840
6,900 DONNELLEYR R + SONS CO 207,199 93,702
5,925 DOVER CORP 251,755 195,051
1,987 DUN + BRADSTREET CORP DEL NEW 49,383 153,396
3,100 EATON CORP 112,467 154,101
19,700 EMERSON ELEC CO 559,227 721,217
1,397 ENERGIZERHLDGS INC (b) 87,823 75,634
3,600 EXPEDITORS INTL WA INC 151,918 119,772
2,800 FASTENAL CO 109,422 97,580
6,753 FEDEX CORP 132,761 433,205
5,350 FISERV INC (b) 48,249 194,580
1,300 FLOWSERVECORP 119,620 66,950
4,250 FLUOR CORP NEW 127,616 190,698
2,800 FOSTER WHEELER LTD 172,525 65,464
700 FTI CONSULTING INC (b) 47,352 31,276
900 GARDNER DENVER INC (b) 50,054 21,006
1,400 GATX CORPORATION 24,276 43,358
8,300 GENERAL DYNAMICS CORP 447,055 477,997
229,200 GENERAL ELEC CO 5,413,801 3,713,040
700 GENERALE CABLE CORP (b) 50,306 12,383
5,050 GENUINE PARTS CO 153,969 191,193
3,700 GOODRICH CORP 111,298 136,974
4,100 GRACO INC 162,258 97,293
1,700 GRAINGER W W INC 74,317 134,028
2,200 HARSCO CORP 59,517 60,896
15,000 HONEYWELLINTL INC 401,329 492,450
2,400 HUBBELL INC 102,187 78,432
2,100 HUNT J B TRANS SVCS INC 40,530 55,167
11,924 ILLINOIS TOOL WKS INC 497,186 417,936
1,369 INGERSOLLRAND COMPANY LIMITED 56,194 23,752
5,400 IRON MTN INC PA (b) 121,527 133,542
3,600 ITT CORP NEW (b) 168,296 165,564
1,300 ITT EDL SVCS INC (b) 52,038 123,474
4,768 JACOBS ENGR GROUP INC (b) 150,683 229,341
432 JOHN BEANTECHNOLOGIES CORP 5,127 3,529
2,238 JOY GLOBAL INC 102,549 51,228
2,700 L 3 COMMUNICATIONS HLDG CORP 176,123 199,206
1,200 LANDSTAR SYS INC 38,351 46,116
400 LINCOLN ELEC HLDGS INC 31,486 20,372
6,500 LOCKHEED MARTIN CORP 432,082 546,520
2,600 MANITOWOCINC 107,595 22,516
1,475 MANPOWER INC WIS 66,373 50,135
8,800 MASCO CORP 173,216 97,944
1,800 MASTERCARD INC 193,005 257,274
4,200 MCDERMOTTINTL INC (b) 182,599 41,496
1,800 MONSTER WORLDWIDE INC (b) 45,970 21,762
9,960 NORFOLK SOUTHN CORP 358,053 468,618
7,560 NORTHROP GRUMMAN CORP 431,730 340,502
1,700 OVERSEAS SHIPHOLDING GROUP INC 109,761 71,587
5,600 OWENS CORNING NEW (b) 130,330 96,880
10,489 PACCAR INC 186,765 299,985
2,200 PALL CORP 55,214 62,546
3,950 PARKER HANNIFIN CORP 212,565 168,033
2,200 PENTAIR INC (b) 72,761 52,074
1,497 PHH CORP (b) 10,184 19,057
5,700 PITNEY BOWES INC 182,172 145,236
See accompanying notes to financial statements. 21 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Industrials (Cont'd):
4,000 PRECISIONCASTPARTS CORP 45,286 237,920
5,300 QUANTA SERVICES INC (b) 92,074 104,940
9,400 RAYTHEON CO 370,624 479,776
9,022 REPUBLIC SVCS INC 172,639 223,655
4,400 REYNOLDS AMERN INC 123,818 177,364
3,300 ROBERT HALF INTL INC 85,171 68,706
5,850 ROCKWELL AUTOMATION INC 82,443 188,604
3,614 ROCKWELL COLLINS INC 131,769 141,271
1,800 SHAW GROUP INC (b) 92,083 36,846
2,400 SKYWEST INC 26,040 44,640
18,565 SOUTHWESTAIRLS CO 262,809 160,030
1,300 SPIRIT AEROSYSTEMS HLDGS INC (b) 24,954 13,221
1,400 SPX CORP 92,591 56,770
3,300 STERICYCLE INC (b) 177,991 171,864
2,300 SUNPOWER CORP (b) 134,286 85,100
740 SUNPOWER CORP (b) 30,786 22,525
500 TELEFLEX INC 22,515 25,050
1,300 TEREX CORP NEW (b) 60,843 22,516
4,350 TEXTRON INC 118,864 60,335
1,790 TOTAL SYSSVCS INC 55,518 25,060
1,500 TRINITY INDS INC 41,498 23,640
10,333 TYCO ELECTRONICS LTD 288,257 167,498
11,325 TYCO INTERNATIONAL LTD BERMUDA 377,850 244,620
11,400 UNION PACCORP 436,933 544,920
13,940 UNITED PARCEL SVC INC 985,419 768,930
23,250 UNITED TECHNOLOGIES CORP 1,021,959 1,246,200
2,500 URS CORP NEW (b) 94,338 101,925
5,600 USG CORP (b) 79,142 45,024
2,100 WALTER INDS INC 56,774 36,771
10,950 WASTE MGMT INC DEL 214,223 362,883
------------- -------------
24,980,758 23,950,448 12.14%
Information technology:
13,200 ACCENTURELTD BERMUDA 511,648 432,828
12,600 ACTIVISION BLIZZARD INC (b) 111,241 108,864
14,524 ADOBE SYSINC (b) 368,313 309,216
24,400 ADVANCED MICRO DEVICES INC (b) 115,918 52,704
1,500 AFFILIATED COMPUTER SVCS INC (b) 70,406 68,925
10,400 AGILENT TECHNOLOGIES INC (b) 250,955 162,552
6,400 ALTERA CORP 120,963 106,944
5,300 AMDOCS LTD 161,841 96,937
4,000 AMPHENOL CORP NEW 168,180 95,920
4,200 ANALOG DEVICES INC 37,670 79,884
19,000 APPLE INC (b) 971,893 1,621,650
27,800 APPLIED MATERIALS INC 391,284 281,614
2,200 ARROW ELECTRS INC (b) 73,136 41,448
4,466 ASML HOLDING N V 30,563 80,701
5,486 AUTODESK INCORPORATED (b) 183,162 107,800
13,566 AUTOMATICDATA PROCESSING INC 495,304 533,686
1,800 AVNET INC (b) 64,539 32,778
3,350 BMC SOFTWARE INC (b) 58,044 90,149
9,012 BROADCOM CORP (b) 183,572 152,934
10,925 CA INC 208,510 202,440
9,000 CADENCE DESIGN SYS INC (b) 147,531 32,940
3,400 CERNER CORP (b) 153,423 130,730
128,550 CISCO SYSINC (b) 703,244 2,095,365
3,234 CITRIX SYS INC (b) 25,998 76,225
5,100 COGNIZANTTECHNOLOGY SOLUTIONS (b) 77,624 92,106
2,074 COMMSCOPEINC (b) 90,418 32,230
5,622 COMPUTER SCIENCES CORP (b) 262,493 197,557
See accompanying notes to financial statements. 22 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Information technology (Cont'd):
8,000 COMPUWARECORP (b) 54,024 54,000
39,200 CORNING INC 490,464 373,576
2,700 CYPRESS SEMICONDUCTOR CORP (b) 8,499 12,069
44,450 DELL INC (b) 1,086,441 455,168
18,500 EBAY INC (b) 170,492 258,260
5,000 ELECTRONIC ARTS INC (b) 260,777 80,200
45,910 EMC CORP (b) 396,942 480,678
3,700 EMULEX CORP (b) 49,943 25,826
2,100 EQUINIX INC (b) 162,761 111,699
1,400 F5 NETWORKS INC (b) 32,375 32,004
700 FAIR ISAAC CORPORATION 23,898 11,802
1,600 FAIRCHILDSEMICONDUCTOR INTL (b) 21,840 7,824
544 FIRST SOLAR INC (b) 60,237 75,050
7,983 FLEXTRONICS INTERNATIONAL LTD 89,720 20,436
1,700 FLIR SYS INC (b) 69,233 52,156
5,067 GOOGLE INC (b) 1,745,397 1,558,863
2,800 HARRIS CORP DEL 37,337 106,540
56,127 HEWLETT PACKARD CO 1,048,980 2,036,849
2,710 IAC INTERACTIVECORP (b) 66,598 42,628
500 IHS INC (b) 34,583 18,710
6,110 INTEGRATED DEVICE TECHNOLOGY (b) 79,318 34,277
123,000 INTEL CORP 678,427 1,803,180
31,200 INTERNATIONAL BUSINESS MACHS 2,691,017 2,625,792
7,800 INTERSIL CORP 123,552 71,682
7,800 INTUIT (b) 187,603 185,562
3,000 JABIL CIRCUIT INC 49,755 20,250
14,267 JUNIPER NETWORKS INC (b) 289,096 249,815
3,000 KLA TENCOR CORP 101,654 65,370
3,000 LAM RESH CORP (b) 83,706 63,840
2,371 LENDERPROCESSING SVCS INC 76,903 69,826
1,800 LEXMARK INTL INC (b) 75,928 48,420
4,600 LINEAR TECHNOLOGY CORP 143,858 101,752
28,600 LSI CORP (b) 120,263 94,094
10,300 MARVELL TECHNOLOGY GROUP LTD 105,209 68,701
2,900 MCAFEE INC (b) 65,012 100,253
6,914 MEMC ELECTR MATLS INC (b) 212,290 98,732
4,267 METAVANTETECHNOLOGIES INC (b) 97,561 68,741
5,400 MICROCHIPTECHNOLOGY INC 101,340 105,462
34,800 MICRON TECHNOLOGY INC (b) 184,801 91,872
177,750 MICROSOFTCORP 2,239,522 3,455,460
2,500 MOLEX INC 68,986 36,225
42,700 MOTOROLA INC 342,508 189,161
4,400 NATIONAL SEMICONDUCTOR CORP 72,388 44,308
4,000 NCR CORP NEW (b) 85,604 56,560
8,800 NETAPP INC (b) 216,784 122,936
5,200 NOVELL INC (b) 31,071 20,228
2,800 NOVELLUS SYS INC (b) 70,810 34,552
2,300 NUANCE COMMUNICATIONS INC (b) 37,870 23,828
17,750 NVIDIA CORP (b) 191,401 143,243
6,700 ON SEMICONDUCTOR CORP (b) 63,550 22,780
82,962 ORACLE CORP (b) 251,358 1,470,916
3,666 PAYCHEX INC 10,315 96,342
1,400 PERKINELMER INC 25,256 19,474
2,600 POLYCOM INC (b) 26,520 35,126
5,700 QLOGIC CORP (b) 82,128 76,608
37,350 QUALCOMM INC 1,002,490 1,338,251
4,500 RAMBUS INC DEL (b) 79,087 71,640
4,200 RED HAT INC (b) 61,669 55,524
1,600 ROPER INDS 104,136 69,456
See accompanying notes to financial statements. 23 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Information technology (Cont'd):
2,100 SALESFORCE COM INC (b) $ 102,263 67,221
7,800 SANDISK CORP (b) 118,234 74,880
500 SOHU COM INC (b) 36,563 23,670
12,956 SUN MICROSYSTEMS INC (b) 214,445 49,492
21,819 SYMANTEC CORP (b) 187,612 294,993
4,200 SYNOPSYS INC (b) 88,560 77,784
6,450 TELLABS INC (b) 37,637 26,574
2,000 TERADATA CORP (b) 38,279 29,660
30,000 TEXAS INSTRS INC 634,345 465,600
11,200 THERMO FISHER SCIENTIFIC INC (b) 369,287 381,584
1,300 TRIMBLE NAVIGATION LTD (b) 49,602 28,093
6,600 UNISYS CORP (b) 38,907 5,610
4,300 VERISIGN INC (b) 82,496 82,044
2,600 WATERS CORP (b) 60,997 95,290
5,900 WESTERN DIGITAL CORP (b) 91,433 67,555
26,850 XEROX CORP 344,530 213,995
9,850 XILINX INC 69,366 175,527
37,940 YAHOO INC (b) 675,580 462,868
------------- -------------
25,719,285 29,104,143 14.75%
Materials:
4,675 AIR PRODS+ CHEMS INC 297,179 235,012
1,000 AIRGAS INC 62,701 38,990
4,316 AK STL HLDG CORP 137,899 40,225
600 ALBEMARLECORP 23,955 13,380
18,700 ALCOA INC 529,300 210,562
4,500 ALLEGHENYTECHNOLOGIES INC 165,665 114,885
5,300 ARCH COALINC 47,687 86,337
3,032 BALL CORP 70,662 126,101
4,200 BEMIS CO INC 93,645 99,456
2,600 CELANESE CORP DE 126,875 32,318
2,700 CLIFFS NAT RES INC 67,919 69,147
3,384 CONSOL ENERGY INC 101,377 96,715
4,300 CROWN HLDGS INC (b) 74,494 82,560
3,537 CYTEC INDS INC 195,563 75,055
21,450 DOW CHEM CO 762,163 323,681
21,925 DU PONT EI DE NEMOURS + CO 935,063 554,703
438 EAGLE MATLS INC 1,727 8,064
1,000 EASTMAN CHEM CO 32,854 31,710
3,671 ECOLAB INC 140,788 129,036
800 FMC CORP 62,972 35,784
9,748 FREEPORT MCMORAN COPPER + GOLD (b) 489,522 238,241
800 GREIF INC 50,244 26,744
5,100 HUNTSMAN CORP 96,099 17,544
11,231 INTERNATIONAL PAPER CO 394,747 132,526
4,883 INTRNTNL FLAVRS + FRAGRNCS INC 105,046 145,123
1,500 LUBRIZOL CORP 72,108 54,585
700 MARTIN MARIETTA MATLS INC 27,965 67,956
900 MASSEY ENERGY CORP 37,637 12,411
4,175 MEADWESTVACO CORP 95,626 46,718
11,215 MONSANTO CO NEW 154,451 788,975
3,500 MOSAIC CO 137,267 121,100
10,245 NEWMONT MNG CORP 232,804 416,972
8,800 NUCOR CORP 154,139 406,560
2,700 OM GROUP INC (b) 12,143 56,997
4,950 OWENS ILLINC (b) 91,031 135,284
1,100 PACKAGINGCORP AMER 24,772 14,806
2,450 PACTIV CORP (b) 22,665 60,956
1,440 PATRIOT COAL CORPORATION (b) 14,204 9,000
7,200 PEABODY ENERGY CORP 208,428 163,800
See accompanying notes to financial statements. 24 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Materials (Cont'd):
3,086 PPG INDS INC $ 144,348 130,939
5,950 PRAXAIR INC 256,512 353,192
4,748 RAYONIER INC 110,370 148,850
3,000 ROHM + HAAS CO 117,514 185,370
6,000 RPM INTL INC 61,643 79,740
3,400 SEALED AIR CORP NEW 82,806 50,796
3,200 SIGMA ALDRICH 187,446 135,168
5,200 SONOCO PRODS CO (b) 127,607 120,432
5,400 SOUTHERN COPPER CORP DEL 64,881 86,724
3,600 STEEL DYNAMICS INC 87,525 40,248
2,349 TITANIUM METALS CORP 62,648 20,695
2,100 UNITED STS STL CORP NEW 133,602 78,120
3,200 VALSPAR CORP 68,240 57,888
2,157 VULCAN MATLS CO 120,017 150,084
------------- -------------
7,976,542 6,958,262 3.53%
Telecommunication services:
7,450 AMERICAN TOWER CORP (b) 148,350 218,434
128,015 AT+T INC 3,317,931 3,648,428
3,450 CENTURYTEL INC 93,913 94,289
3,400 CROWN CASTLE INTL CORP (b) 101,018 59,772
1,140 ECHOSTAR CORP (b) 36,944 16,952
3,992 EMBARQ CORP 121,233 143,552
11,525 FRONTIER COMMUNICATIONS CORP 88,166 100,729
8,000 JDS UNIPHASE CORP (b) 111,480 29,200
700 LEAP WIRELESS INTL INC (b) 36,068 18,823
34,500 LEVEL 3 COMMUNICATIONS INC (b) 107,123 24,150
7,353 LIBERTY GLOBAL INC (b) 190,626 117,060
3,100 METROPCS COMMUNICATIONS INC (b) 55,475 46,035
3,200 NII HLDGSINC (b) 136,078 58,176
27,900 QWEST COMMUNICATIONS INTL INC 104,765 101,556
1,500 SBA COMMUNCATIONS CORP (b) 53,918 24,480
26,366 SPRINT NEXTEL CORP (b) 187,678 48,250
1,300 TELEPHONE+ DATA SYS INC 26,702 41,275
1,300 TELEPHONE+ DATA SYS INC 26,702 36,530
6,200 TIME WARNER CABLE INC (b) 158,565 132,990
1,980 UNITED STATES CELLULAR CORP (b) 99,059 85,615
53,883 VERIZON COMMUNICATIONS 2,186,571 2,165,634
2,660 VODAFONE GROUP PLC NEW (d) 30,679 54,370
11,424 WINDSTREAM CORP 138,133 105,101
------------- -------------
7,557,176 7,371,399 3.74%
Utilities:
24,467 AES CORP (b) 353,174 201,608
4,500 AGL RES INC 135,198 141,075
3,000 ALLEGHENYENERGY INC 168,525 101,580
5,400 AMEREN CORP 209,724 179,604
6,000 AMERICAN ELEC PWR INC 206,517 199,680
3,488 AQUA AMERINC 67,899 71,818
5,800 CENTERPOINT ENERGY INC 66,308 73,196
14,300 CMS ENERGY CORP 204,448 144,573
4,200 CONSOLIDATED EDISON INC 175,999 163,506
2,515 CONSTELLATION ENERGY GROUP INC 129,103 63,101
11,762 DOMINION RES INC VA NEW 415,229 421,550
5,300 DTE ENERGY CO 213,573 189,051
26,313 DUKE ENERGY HLDG CORP 334,628 394,958
8,700 DYNEGY INC DEL (b) 61,901 17,400
9,425 EDISON INTL 108,441 302,731
4,164 ENTERGY CORP NEW 150,636 346,153
13,732 EXELON CORP 639,169 763,637
5,816 FIRSTENERGY CORP 298,081 282,541
See accompanying notes to financial statements. 25 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Utilities (Cont'd):
8,972 FPL GROUPINC 419,343 451,561
3,300 INTEGRYS ENERGY GROUP INC 164,560 141,834
7,300 MDU RES GROUP INC 233,491 157,534
7,200 MIRANT CORP NEW (b) 263,250 135,864
2,900 NALCO HLDG CO 58,310 33,466
1,500 NATIONAL FUEL GAS CO N J 38,322 46,995
7,800 NISOURCE INC 128,106 85,566
2,600 NORTHEASTUTILS 64,649 62,556
6,400 NRG ENERGY INC (b) 272,994 149,312
3,900 NV ENERGYINC 52,241 38,571
2,400 OGE ENERGY CORP 43,344 61,872
2,128 PEPCO HLDGS INC 49,590 37,793
7,100 PETROHAWKENERGY CORP (b) 263,718 110,973
9,800 PG+E CORP 131,785 379,358
1,300 PIEDMONT NAT GAS INC 31,174 41,171
2,400 PINNACLE WEST CAP CORP 71,637 77,112
6,387 PPL CORP 203,124 196,017
6,131 PROGRESS ENERGY INC 230,254 244,320
9,384 PUBLIC SVC ENTERPRISE GROUP 285,119 273,731
6,350 PUGET ENERGY INC 129,583 173,165
5,800 QUESTAR CORP 66,188 189,602
12,600 RELIANT ENERGY INC (b) 161,722 72,828
6,500 SEMPRA ENERGY 360,600 277,095
16,459 SOUTHERN CO 456,985 608,983
7,200 SOUTHWESTERN ENERGY CO (b) 107,060 208,584
14,554 SPECTRA ENERGY CORP 278,225 229,080
7,600 TECO ENERGY INC 90,842 93,860
3,000 UGI CORP NEW 48,600 73,260
3,710 WISCONSINENERGY CORP 71,536 155,746
12,125 XCEL ENERGY INC 108,918 224,919
------------- -------------
8,823,819 9,090,490 4.61%
Cash equivalents:
906,875 SSGA MONEY MARKET FUND, current rate 1.15% 906,875 906,875
------------- -------------
906,875 906,875 0.46%
------------- ------------- ----------
Schedule of investments grand total (c) $ 189,802,855 196,738,621 99.73%
============= ============= ==========
Notes to schedule of investments:
(a) Securities are valued in accordance with procedures described in note 2 to
the December 31, 2008 financial statements.
(b) Currently non-income producing assets.
(c) At December 31, 2008, the cost for Federal income tax purposes was
$190,089,025. The aggregate gross unrealized appreciation and
depreciation of investments in securities based of this cost were as
follows:
Gross unrealized appreciation $ 43,391,699
-------------
Gross unrealized depreciation (36,742,102)
-------------
Net unrealized appreciation $ 6,649,596
=============
(d) Foreign security values are stated in U.S. dollars. As of December 31,
2008 the value of foreign securities represented 0.03% of net assets.
See accompanying notes to financial statements. 26 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Growth Fund
December 31, 2008
Clearwater Growth Fund Portfolio Diversification
(as a percentage of net assets)
[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
Consumer Discretionary 10%
Consumer Staples 10%
Energy 12%
Financials 14%
Healthcare 14%
Industrials 12%
Information Technology 15%
Materials 4%
Telecom 4%
Utilities 5%
See accompanying notes to financial statements.
27
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Small Cap Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Common stocks:
Consumer discretionary:
8,600 AMERISTARCASINOS INC 66,361 74,304
17,700 AUTOLIV 676,547 379,842
13,305 BRIGHTPOINT INC (b) 94,841 57,877
32,800 CENTURY CASINOS INC (b) 44,773 33,784
24,100 CRACKER BARREL OLD CTRY STORE 553,968 496,219
81,150 DENNYS CORP (b) 206,329 161,489
13,545 DOLLAR TREE INC (b) 379,547 566,181
30,040 FOSSIL INC (b) 970,448 501,668
50,050 FREDS INC 487,595 538,538
20,000 GAYLORD ENTMT CO NEW (b) 690,670 216,800
7,950 GEOEYE INC (b) 167,309 152,879
108,600 HANCOCK FABRICS INC (b) 44,526 54,300
357,467 HANDLEMANCO DEL (b) 498,524 57,195
23,500 HANESBRANDS INC (b) 550,908 299,625
24,690 JAKKS PACINC (b) 582,297 509,355
39,830 JO ANN STORES INC (b) 436,967 616,967
12,900 ORIENT EXPRESS HOTELS LTD (b) 441,491 98,814
35,605 PHILLIPS VAN HEUSEN CORP 1,359,322 716,729
37,000 SAKS INC (b) 726,044 162,060
12,000 SNAP ON INC 552,421 472,560
40,385 TUPPERWARE BRANDS CORP 1,274,282 916,740
11,850 VAIL RESORTS INC (b) 430,566 315,210
13,000 WABCO HLDGS INC 614,201 205,270
11,050 WABTEC 385,120 439,238
16,000 WABTEC 424,579 636,000
24,000 WYNDHAM WORLDWIDE CORP 691,325 157,200
------------- -------------
13,350,959 8,836,841 7.31%
Consumer staples:
27,000 FLOWERS FOODS INC 511,723 657,720
13,800 HQ SUSTAINABLE MARTITIME (b) 61,762 108,054
76,320 INTER PARFUMS INC 930,391 586,138
108,721 MEDIFAST INC (b) 572,705 601,227
9,400 OMEGA PROTEIN CORP (b) 63,279 37,694
14,050 OVERHILL FARMS INC (b) 82,007 58,870
17,400 RALCORP HLDGS INC NEW (b) 995,846 1,016,160
65,000 SALLY BEAUTY HLDGS INC (b) 562,956 369,850
50,400 SPARTAN STORES INC 1,166,779 1,171,800
59,010 TREEHOUSE FOODS INC (b) 1,285,800 1,607,432
------------- -------------
6,233,249 6,214,945 5.14%
Energy:
7,000 ATLAS ENERGY RESOURCES LLC 279,052 89,390
34,955 ATP OIL & GAS CORPORATION (b) 1,292,638 204,487
22,400 BARRETT BILL CORP (b) 482,528 473,312
22,854 COMSTOCK RES INC (b) 793,608 1,079,852
34,000 EXCO RES INC (b) 570,189 308,040
22,000 GOODRICH PETE CORP (b) 668,990 658,900
12,665 GULFMARK OFFSHORE INC (b) 623,000 301,300
39,650 NATCO GROUP INC (b) 1,453,853 601,887
14,850 OIL STATES INTL INC (b) 652,649 277,547
62,800 PETROQUEST ENERGY INC (b) 1,576,321 424,528
14,000 PLAINS EXPL & PRODTN CO (b) 615,865 325,360
53,115 ROSETTA RES INC (b) 1,181,805 376,054
32,355 T 3 ENERGY SVCS INC (b) 1,495,294 305,431
8,169 T.G.C. INDUSTRIES INC (b) 58,813 16,910
21,000 TESCO CORP (b) 552,977 149,940
13,350 WHITING PETE CORP NEW (b) 394,647 446,691
27,000 WILLBROS GROUP INC (b) 458,328 228,690
------------- -------------
13,150,557 6,268,318 5.19%
Financials:
24,275 ABINGTON BANCORP INC PENN 233,652 224,544
32,800 ASPEN INSURANCE HOLDINGS LTD (b) 716,918 795,400
30,000 BANKFINANCIAL CORP 512,714 305,700
28,000 BROADRIDGE FINL SOLUTIONS INC 458,289 351,120
20,000 CITIZENS FIRST BANCORP INC (b) 478,265 42,000
324,639 CITIZENS REPUBLIC BANKCORP INC (b) 1,037,720 967,424
See accompanying notes to financial statements. 28 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Small Cap Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
12,552 COGDELL SPENCER INC 189,444 117,487
7,550 COLUMBIA BKY SYS INC 114,416 90,072
871 COMMUNITYBANKERS TR CORP 2,535 2,613
26,000 COMMUNITYTR BANCORP INC 746,975 955,500
28,100 CONSECO INC (b) 59,447 145,558
30,650 CORPORATEOFFICE PPTYS TR 1,113,933 940,955
34,500 EASTERN INS HLDGS INC 454,633 277,035
14,650 EASTGROUPPPTYS INC 424,110 521,247
10,300 ENCORE BANCSHARES INC (b) 167,687 113,300
47,000 EPOCH HLDG CORP 635,624 356,730
32,400 FIRST COMWLTH FINL CORP PA 319,064 401,112
47,676 FIRST MERCHANTS CORP 973,433 1,058,884
84,000 FIRST NIAGARA FINL GROUP INC 1,211,964 1,358,280
9,350 FIRST POTOMAC RLTY TR 139,984 86,955
27,000 FORESTAR GROUP INC (b) 636,481 257,040
15,285 HEALTHCARE RLTY TR 287,988 358,892
300 HF FINANCIAL CORP 3,312 3,846
34,080 HOME FED BANCORP INC MD 450,267 365,338
12,820 HORIZON BANCORP IND 247,077 160,250
6,200 IBERIABANK CORP 249,764 297,600
9,400 INDEPENDENT BK CORP MI 54,527 20,304
34,485 IPC HOLDINGS LTD BERMUDA (d) 761,349 1,031,102
168,645 KITE RLTYGROUP TR 1,881,197 937,666
4,200 MEDICAL PPTYS TR INC 26,397 26,502
10,350 MID AMER APT CMNTYS INC 500,662 384,606
16,000 MISSION WEST PPTYS INC MD 113,560 122,400
79,795 NATIONAL RETAIL PPTYS INC 1,556,137 1,371,676
53,550 NEWALLIANCE BANCSHARES INC 681,318 705,254
9,350 PACIFIC CONTL CORP 133,529 139,970
15,900 PLATINUM UNDERWRITERS HOLDINGS (b) 480,271 573,672
20,000 PRIVATEBANKCORP INC 668,656 649,200
35,600 PULASKI FINL CORP 343,866 238,164
34,490 RENASANT CORP 703,942 587,365
12,700 STELLARONE CORP 225,290 214,630
750 STERLING BANCSHARES INC 4,450 4,560
63,050 TEXAS CAPBANCSHARES INC (b) 979,089 842,348
5,250 WASHINGTON TR BANCORP INC 116,362 103,688
82,000 WESTFIELDFINL INC NEW 857,918 846,240
10,250 WINTRUST FINL CORP 254,339 210,843
------------- -------------
22,208,554 19,565,068 16.19%
Healthcare:
135,558 AKORN INC (b) 656,987 311,783
17,850 AMEDISYS INC (b) 860,357 737,919
15,050 AMERIGROUP CORP (b) 418,202 444,276
10,000 AMERISOURCEBERGEN CORP 327,861 356,600
12,445 BIO IMAGING TECHNOLOGIES INC (b) 85,525 45,549
9,175 BIO RAD LABORATORIES INC (b) 721,278 690,969
27,350 CATALYST HEALTH SOLUTIONS INC (b) 531,257 665,973
12,000 COVIDIEN LTD 503,805 434,880
29,324 EMERGENCY MED SVCS CORP (b) 651,331 1,073,552
4,665 ERESEARCHTECHNOLOGY INC (b) 29,714 30,929
30,473 HEALTHTRONICS INC (b) 75,346 68,564
16,000 HILL ROM HLDGS 377,927 263,360
37,380 IMMUCOR CORP (b) 976,472 993,560
28,000 IMS HEALTH INC 419,289 424,480
9,450 INTEGRAMED AMER INC (b) 72,200 63,315
49,950 KENDLE INTL INC (b) 1,689,084 1,284,714
14,415 MARTEK BIOSCIENCES CORP (b) 458,715 436,919
9,400 MAXIMUS INC 299,141 330,034
37,705 NEOGENOMICS INC (b) 39,213 23,000
60,250 NOVAMED EYECARE INC (b) 259,499 208,465
5,350 NOVEN PHARMACEUTICALS INC (b) 63,668 58,850
13,650 ONYX PHARMACEUTICALS INC (b) 542,660 466,284
7,967 ORASURE TECHNOLOGIES INC (b) 38,107 29,319
18,000 PHARMERICA CORP (b) 358,538 282,060
25,050 PSYCHIATRIC SOLUTIONS INC (b) 918,891 697,643
See accompanying notes to financial statements. 29 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Small Cap Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
49,650 SUNLINK HEALTH SYS INC (b) 385,228 44,685
123,720 SYMMETRY MED INC (b) 1,979,030 986,048
58,150 SYNERGETICS USA INC (b) 129,352 51,754
72,495 THORATEC CORP (b) 1,295,649 2,355,363
5,450 UNIVERSALHEALTH SVCS INC 204,605 204,605
------------- -------------
15,368,931 14,065,450 11.64%
Industrials:
62,745 ACTUANT CORP 988,131 1,193,410
14,000 ACUITY BRANDS INC 504,959 488,740
27,000 AECOM TECHNOLOGY CORP (b) 628,313 829,710
10,650 ALLIED DEFENSE GROUP INC (b) 64,813 66,030
36,000 ALTRA HLDGS INC (b) 544,587 284,760
18,000 AMERICAN RAILCAR INDS INC 493,342 189,540
500 AMERICAN SCIENCE + ENGR INC 28,493 36,980
14,409 APPLIED SIGNAL TECHNOLOGY INC 213,968 258,497
30,710 ARGON ST INC (b) 540,579 579,191
16,550 ASTRONICSCORP (b) 205,267 147,295
2,475 ASTRONICSCORP (b) 32,956 21,260
52,155 BE AEROSPACE INC (b) 1,625,673 401,072
6,000 BRINKS CO 191,581 161,280
11,000 BRINKS HOME SEC HLDGS INC (b) 258,475 241,120
18,000 BUCYRUS INTL INC NEW 429,218 333,360
10,063 CECO ENVIRONMENTAL CORP (b) 26,025 24,352
18,500 CHICAGO BRDG + IRON CO N V 477,116 185,925
1,400 COINSTAR INC (b) 26,284 27,314
14,000 COLFAX CORP (b) 272,190 145,460
22,250 COVANTA HLDG CORP (b) 429,012 488,610
23,810 CRA INTL INC (b) 956,384 641,203
48,150 CURTISS WRIGHT CORP 2,034,828 1,607,729
11,300 DONALDSONCO INC 346,746 380,245
10,290 DST SYS INC DEL (b) 394,073 390,814
95,465 EAGLE BULK SHIPPING INC (b) 2,458,737 651,071
8,400 ENNIS INC 121,818 101,724
13,850 ENPRO INDS INC (b) 429,513 298,329
8,500 FLOWSERVECORP 433,671 437,750
23,500 FOSTER L B CO (b) 542,920 735,080
20,000 FOSTER WHEELER LTD (b) 407,971 467,600
23,840 GARDNER DENVER INC (b) 924,976 556,426
127,050 GENCORP INC (b) 856,123 467,544
19,950 GENESEE & WYO INC (b) 502,922 608,475
8,033 GEVITY HRINC 11,858 12,130
120,200 GT SOLAR INTL INC (b) 873,562 347,378
13,000 HARSCO CORP 678,865 359,840
7,530 HURON CONSULTING GRP INC (b) 303,865 431,243
49,502 ICF INTL INC (b) 724,496 1,216,264
63,100 ICONIX BRAND GROUP INC (b) 690,074 617,118
40,812 II VI INC (b) 986,361 779,101
46,950 INVENTUREGROUP INC (b) 87,423 76,529
49,875 IPG PHOTONICS CORP (b) 781,893 657,353
40,000 JOHN BEANTECHNOLOGIES CORP 516,680 326,800
13,300 JOY GLOBAL INC 515,967 304,437
17,550 KANSAS CITY SOUTHERN (b) 461,425 334,328
35,750 KOPPERS HLDGS INC 1,471,087 772,915
16,932 KREISLER MFG CORP (b) 144,742 82,459
2,700 KVH INDS INC (b) 10,996 13,986
5,350 LECG CORP (b) 45,377 35,899
14,200 MANITEX INTL INC (b) 57,084 14,626
20,200 MCDERMOTT INTL INC (b) 481,195 199,576
43,000 MUELLER WTR PRODS INC 654,608 361,200
37,500 PERINI CORP (b) 1,157,370 876,750
18,830 REGAL BELOIT CORP 577,311 715,352
11,000 SHAW GROUP INC (b) 545,024 225,170
242,740 STAMFORD INDL GROUP INC (b) 362,814 157,781
7,600 STERLING CONSTR INC (b) 126,922 140,904
14,500 TENNANT CO 600,951 223,300
11,800 TEREX CORP NEW (b) 500,395 204,376
10,650 THOMAS + BETTS CORP (b) 497,587 255,813
See accompanying notes to financial statements. 30 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Small Cap Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
18,000 TIMKEN CO 583,801 353,340
12,000 TYCO INTERNATIONAL LTD BERMUDA (d) 583,430 259,200
9,270 ULTRALIFECORP COM (b) 80,063 124,311
471,699 VALASSIS COMMUNICATIONS INC (b) 3,600,035 622,643
32,263 WHX CORP (b) 443,393 258,104
83,800 WRIGHT EXPRESS CORP (b) 1,916,145 1,055,880
------------- -------------
39,464,463 25,864,000 21.41%
Information technology:
474,785 3COM CORP (b) 984,369 1,082,510
340,796 8X8 INC NEW (b) 374,767 161,878
9,400 ADEPT TECHNOLOGY INC (b) 69,014 35,250
149,400 ADVANCED ANALOGIC TECHNOLOGIES (b) 394,323 451,188
93,215 ALLIANCE FIBER OPTIC PRODS INC (b) 117,524 59,937
22,800 ANADIGICSINC (b) 30,998 33,744
154,806 ANAREN INC (b) 1,649,684 1,849,932
54,600 AVOCENT CORP (b) 1,451,344 977,886
44,175 AXT INC (b) 176,071 59,636
29,350 BLUEPHOENIX SOLUTIONS LTD (b) 110,814 54,591
20,630 CACI INTLINC (b) 860,099 930,207
15,682 DATALINK CORP (b) 61,349 48,771
82,350 DAYSTAR TECHNOLOGIES INC (b) 286,571 77,409
84,076 DYNAMICS RESH CORP (b) 794,717 672,608
33,100 ENTROPIC COMMUNICATIONS INC (b) 48,110 16,550
13,335 FREQUENCYELECTRS INC (b) 80,200 38,005
90,750 GILAT SATELLITE NETWORKS LTD (b) 502,636 236,858
1,000 GLOBECOMMSYS INC (b) 5,326 5,490
675,700 GRAPHON CORP (b) 198,429 47,299
11,250 GSI TECHNOLOGY INC (b) 39,591 30,825
32,450 HENRY JACK + ASSOC INC 736,133 629,855
5,300 INDUSTRIAL SVCS AMER INC FL 54,075 27,931
8,500 INTEGRAL SYS INC MD (b) 76,485 102,425
79,650 KANA SOFTWARE INC (b) 119,228 55,755
107,549 LOGICVISION INC DE (b) 86,944 80,662
246,598 LOOKSMART LTD (b) 754,933 401,955
41,935 MICROSEMI CORP (b) 947,169 530,058
23,450 MICROTUNE INC DEL (b) 85,617 47,838
206,446 RADIANT SYS INC (b) 2,371,931 695,723
9,350 RADISYS CORP (b) 77,749 51,706
9,050 SEMITOOL INC (b) 76,712 27,603
73,870 SKYWORKS SOLUTIONS INC (b) 314,418 409,240
16,800 SL INDS INC (b) 256,691 147,840
26,850 SPECTRUM CTL INC (b) 219,607 164,859
4,950 SYMMETRICOM INC (b) 16,904 19,553
13,455 TELEDYNE TECHNOLOGIES INC (b) 704,515 599,420
95,460 TELLABS INC (b) 356,814 393,295
11,400 TESSCO TECHNOLOGIES INC (b) 169,472 99,294
107,500 TIER TECHNOLOGIES INC (b) 945,690 580,500
15,100 TRIDENT MICROSYSTEMS INC (b) 25,721 28,539
202,200 UNISYS CORP (b) 166,847 171,870
77,662 VIASAT INC (b) 1,564,539 1,870,101
9,210 VIRAGE LOGIC CORP (b) 61,625 27,538
23,300 ZILOG INC (b) 55,218 67,570
59,500 ZORAN CORP (b) 375,375 406,385
------------- -------------
18,856,350 14,508,086 12.01%
Materials:
17,000 APTARGROUP INC 711,338 599,080
10,500 DELTIC TIMBER CORP 503,271 480,375
14,000 FMC CORP 501,894 626,220
156,605 GRAFTECH INTL LTD (b) 2,984,423 1,302,954
25,175 GREIF INC 1,433,364 841,600
23,962 HAYNES INTL INC (b) 1,308,459 589,944
28,599 INNOSPEC INC 626,242 168,448
37,120 ROCK TENNCO (b) 1,036,309 1,268,762
25,540 ROCKWOOD HLDGS INC (b) 757,125 275,832
81,395 SOLUTIA INC (b) 1,129,331 366,278
14,000 TEXAS INDS INC 775,328 483,000
7,950 UFP TECHNOLOGIES INC (b) 51,823 42,056
42,000 ZEP INC 601,927 811,020
------------- -------------
12,420,831 7,855,568 6.50%
See accompanying notes to financial statements. 31 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Small Cap Fund
December 31, 2008
Percent
Fair of
Shares Security Cost value (a) net assets
- ------------ --------------------------------------------------------------- ------------- ------------- ----------
Utilities:
11,900 ALLEGHENYENERGY INC 500,010 402,934
22,080 ALLETE INC 896,940 712,522
12,000 ALLETE INC 558,188 387,240
24,500 CALPINE CORP (b) 460,694 178,360
7,050 CHESAPEAKE UTILS CORP 198,206 221,934
19,000 CLECO CORP NEW 470,134 433,770
9,650 CONNECTICUT WTR SVC INC 234,888 227,837
34,950 DPL INC (b) 769,275 798,258
14,000 ITC HLDGSCORP 638,988 611,520
34,212 MDU RES GROUP INC 691,112 738,295
14,800 MIDDLESEXWTR CO 278,126 255,004
94,870 NEUSTAR INC (b) 2,185,917 1,814,863
68,030 NGP CAP RES CO 1,101,107 569,411
24,305 ONEOK INCNEW 418,385 707,762
10,000 OTTER TAIL CORP 361,449 233,300
42,000 PETROHAWK ENERGY CORP (b) 473,474 656,460
24,500 PORTLAND GEN ELEC CO 677,887 477,015
107,200 PREMIERE GLOBAL SVCS INC (b) 1,666,691 922,992
22,050 SOUTHWESTGAS CORP 567,549 556,101
139,850 SYNIVERSEHLDGS INC (b) 2,129,247 1,669,809
10,000 VECTREN CORP 248,576 250,100
------------- -------------
15,526,845 12,825,486 10.61%
ETFs:
Commodities:
23,000 POWERSHARES DB MULTI SECTOR 591,023 602,600
15,000 SPDR SER TR 402,983 437,400
------------- -------------
994,006 1,040,000 0.86%
Cash equivalents:
6,892,221 SSGA MONEY MARKET FUND, current rate 1.15% 6,892,221 6,892,221 5.70%
------------- ------------- ----------
Grand Total (c) $ 164,466,965 123,935,982 102.56%
============= ============= ==========
Notes to schedule of investments:
(a) Securities are valued in accordance with procedures described in
note 2 to the financial statements.
(b) Currently non-income producing assets.
(c) At December 31, 2008, the cost for Federal income tax purposes was
$164,545,941. The aggregate gross unrealized appreciation and
depreciation of investments in securities based on this cost were as
follows:
Gross unrealized appreciation $ 8,464,119
Gross unrealized depreciation (49,074,078)
-------------
Net unrealized depreciation $ (40,609,959)
=============
(d) Foreign security values are stated in U.S. dollars. As of December
31, 2008, the value of foreign securities represented 1.07% of net
assets.
See accompanying notes to financial statements. 32 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Clearwater Small Cap Fund Portfolio Diversification
(as a percentage of net assets)
[THE FOLLOWING TABLE WAS REPRESENTED BY PIA CHART IN THE PRINTED MATERIAL.]
Consumer Discretionary 7%
Consumer Staples 5%
Energy 5%
Financials 16%
Healthcare 11%
Industrials 21%
Information Technology 12%
Materials 6%
Utilities 10%
ETFs: Commodities 1%
Cash equivalants and other assets/liabilities 6%
See accompanying notes to financial statements.
33
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Percent
Maturity Coupon Fair of
Par/Shares Security date rate Cost Value (a) net assets
- ----------- --------------------------------------------- ---------- -------- -------------- ------------- ----------
Closed-end funds:
44,500 AMERICAN MUN INCOME $ 527,733 369,350
108,100 BLACKROCKLONG TERM MUN 1,186,180 735,080
18,200 BLACKROCKMUN BD TR 169,379 165,620
21,400 BLACKROCKMUN INCOME TR II 199,705 194,740
21,700 BLACKROCKMUNI YIELD 274,602 197,470
104,500 BLACKROCKMUNIHOLDINGS FL INSD 1,312,915 956,175
59,500 BLACKROCKMUNIHOLDINGS INSD FD 749,861 561,680
71,200 BLACKROCKMUNIYIELD FLA FD INC 905,807 637,240
78,300 BLACKROCKMUNIYIELD INSD FD 1,032,557 709,398
61,100 BLACKROCKMUNIYIELD MI INSD FD 820,293 581,061
34,000 BLACKROCKMUNIYIELD MICH INSD 424,838 296,480
54,700 BLACKROCKMUNIYIELD PA INSD 774,527 509,804
28,100 BLACKROCKMUNIYIELD QUALITY FD 333,747 239,693
12,500 DREYFUS STRATEGIC MUN BD FD 68,613 69,500
202,100 DWS MUN INCOME TR 2,199,611 1,657,220
5,000 EATON VANCE 41,400 40,000
1,100 EATON VANCE INSD MI MUN BD FD 15,510 9,493
9,282 EATON VANCE INSD MUN BD FD 110,095 81,867
39,200 EATON VANCE NATL MUN INCOME T 521,374 294,392
10,800 FEDERATEDPREMIER MUN INCOME 128,672 98,064
84,500 INSURED MUN INCOME FD 1,116,261 853,450
57,200 INVESTMENT GRADE MUNI INC FD 772,405 570,284
93,500 MBIA CAP CLAYMORE MANAGED 1,194,493 794,750
6,500 MFS HIGH INCOME NUM TR 23,108 18,590
67,200 MORGAN STANLEY DEAN WITTER 507,600 388,416
85,881 MSDW QUALITY MUNICIPAL INCOM 963,920 810,717
77,800 MSDW QUALMUNI INVESTMENT TR 952,004 718,872
9,100 NEUBERGERBERMAN INTER MUN FD 119,152 102,921
30,500 NUVEEN DIVID ADVANTAGE MUN FD 338,337 302,560
17,000 NUVEEN DIVID ADVANTAGE MUN FD3 185,431 168,980
102,800 NUVEEN FLA INVT QUALITY MUN FD 1,345,366 937,536
124,100 NUVEEN FLA QUALITY INCOME MUN 1,726,853 1,190,119
13,500 NUVEEN INSD DIVID ADVANTAGE 181,771 154,710
4,800 NUVEEN MASS PREM INCOME MUN FD 65,734 46,464
30,600 NUVEEN MICH PREM INCOME MUN FD 404,605 293,148
44,600 NUVEEN MUN ADVANTAGE FD INC 522,316 463,394
15,500 NUVEEN N J INVT QUALITY MUN FD 211,528 148,025
10,100 NUVEEN PADIVID ADVANTAGE MUN 127,549 97,869
48,500 NUVEEN PAINVT QUALITY MUN FD 673,352 446,200
26,900 NUVEEN PREM INCOME MUN FD 2 381,052 272,766
27,100 NUVEEN PREMIER INC 367,653 267,477
116,479 PUTNAM MUN OPPORTUITIES TR 1,333,285 1,016,862
131,000 SELIGMAN SELECT MUN FD INC 1,313,469 1,198,650
22,700 VAN KAMPEN MERRITT 293,421 200,214
103,100 VAN KAMPEN MERRITT ADVANTAGE 1,216,908 770,157
45,200 VAN KAMPEN MERRITT PA 632,310 380,132
21,400 VAN KAMPEN MERRITT SELECT SECT 229,256 154,294
62,177 VAN KAMPEN MERRITT TR INVT 880,329 549,645
22,000 WESTERN ASSET MGNT MUNS FD INC 240,488 205,260
48,606 WESTERN ASSET PARTNERS FD INC 620,291 470,992
12,700 WESTERN INTER MUNI FD INC 111,045 95,885
-------------- -------------
30,848,711 22,493,665 6.07%
Municipal bonds:
750,000 ABILENE TX HLTH FACS DEV CORP 11/15/2028 5.150 750,000 671,693
1,000,000 ADAMS CNTY NE HOSP AUTH 12/15/2028 5.500 1,022,173 832,940
500,000 ADAMS CNTY PA INDL DEV AUTH 8/15/2021 5.875 500,044 512,005
550,000 AJCKSONVILLE FL ECONOMIC DEV 9/1/2017 6.000 550,000 449,053
1,500,000 ALABAMA HSG FIN AUTH 10/1/2028 5.250 1,500,000 1,362,630
750,000 ALABAMA HSG FIN AUTH SINGLE 4/1/2038 4.500 554,722 565,733
200,000 ALABAMA SPL CARE FACS FING 11/1/2019 5.000 209,389 203,698
1,270,000 ALACHUA CNTY FL HLTH FACS AUTH 12/1/2011 6.000 1,270,000 1,271,092
500,000 ALASKA HSG FIN CORP HOME MTG 12/1/2033 5.450 500,000 453,870
350,000 ALASKA INDL DEV + EXPT AUTH 12/1/2010 5.400 350,000 334,376
See accompanying notes to financial statements. 34 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Percent
Maturity Coupon Fair of
Par/Shares Security date rate Cost Value (a) net assets
- ----------- --------------------------------------------- ---------- -------- -------------- ------------- ----------
250,000 ALASKA INDL DEV + EXPT AUTH CM 12/1/2011 5.450 250,000 233,600
500,000 ALASKA STHSG FIN CORP 6/1/2049 6.000 505,929 489,995
1,500,000 ALASKA STHSG FIN CORP 6/1/2032 5.250 1,275,898 1,313,385
2,000,000 ALASKA STHSG FIN CORP 12/1/2034 5.250 2,009,494 1,845,800
1,000,000 ALBANY NYINDL DEV AGY CIVIC 10/20/2030 5.375 978,869 918,760
275,000 ALBANY NYINDL DEV AGY CIVIC 5/1/2016 6.500 275,000 212,198
250,000 ALBANY NYINDL DEV AGY CIVIC 4/1/2020 5.000 255,076 187,455
350,000 ALEUTIANSEAST BUROUGH AK 6/1/2025 5.500 313,342 185,441
500,000 ALEXANDRIA VA REDEV + HSG AUTH 10/1/2029 6.125 527,938 492,160
340,000 ALLEGHENYCNTY PA HOSP DEV 4/1/2009 3.500 339,590 338,103
350,000 ALLEGHENYCNTY PA HOSP DEV 4/1/2010 3.875 347,804 341,432
250,000 ALTOONA IOWA URBAN REN TAX INC 6/1/2028 6.000 252,305 199,448
250,000 AMHERST NY INDL DEV AGY CIVICF 1/1/2013 4.875 250,000 227,213
500,000 ANDERSON IN ECONOMIC DEV REV 10/1/2021 4.750 495,734 341,990
440,000 ARBOR GREENE CMNTY DEV DIST FL 5/1/2019 5.000 448,159 359,207
500,000 ARIZONA HEALTH FACS AUTH 10/1/2010 4.750 500,000 481,915
767,041 ARIZONA HEALTH FACS AUTH REV 7/1/2027 5.250 781,214 493,438
1,750,000 ARLINGTONTX SPL OBLIG 8/15/2034 5.000 1,879,528 1,769,163
375,000 ATLANTA GA DEV AUTH REV 1/1/2031 5.000 383,787 313,676
900,000 ATLANTA GA TAX ALLOCATION 1/1/2020 5.400 894,560 674,892
650,000 ATOKA CNTY OK 10/1/2018 5.875 642,151 469,066
375,000 AUSTIN TX 1/1/2009 6.000 375,000 375,000
630,000 AUSTIN TXCONVENTION 1/1/2012 6.000 566,073 567,617
50,000 AUSTIN TXUTIL SYS REV 5/15/2018 5.250 50,076 50,084
400,000 AVE MARIASTEWARDSHIP CMNTY 11/1/2012 4.800 399,658 328,660
340,000 BADGER TOB ASSET SECURITIZATIO 6/1/2027 6.125 346,845 300,801
150,000 BANSON COMM PK CMNTY IMPT 6/1/2010 5.000 149,491 147,279
250,000 BAPTIST RD RRAL TRANSN AUTH CO 12/1/2017 4.800 250,000 174,055
495,000 BELMONT CMNTY DEV DIST FL (b) 11/1/2014 5.125 494,364 198,000
75,000 BENTON HARBOR MI CHARTER 5/1/2009 10.000 75,000 74,151
500,000 BERKELEY CNTY S C SCH DIST INS 12/1/2019 5.250 520,339 513,165
500,000 BERKELEY CNTY SC SCH DIST 12/1/2024 5.250 516,345 493,085
750,000 BERKELEY CNTY SC SCH DIST 12/1/2020 5.000 760,024 755,528
300,000 BEXAR CNTY TX HLTH FACS DEVCP 7/1/2027 5.000 308,993 180,459
250,000 BEXAR CNTY TX HSG FIN CORP 12/1/2021 6.500 268,782 186,768
825,000 BEXAR CNTY TX HSG FIN CORP MF 4/1/2030 9.000 822,438 571,016
250,000 BEXAR CNTY TX HSG FIN CORP MF 8/1/2030 6.100 252,143 173,775
570,000 BEXAR CNTY TX HSG FIN CORP MF 8/1/2030 8.125 549,677 420,062
190,000 BEXAR CNTY TX HSG FIN CORP MF 6/1/2011 5.500 188,491 176,482
1,005,000 BEXAR CNTY TX HSG FIN CORP MF (b) 6/1/2031 10.500 1,005,000 494,430
475,000 BEXAR CNTY TX HSG FIN CORP MF 9/15/2021 8.750 475,000 422,123
940,000 BEXAR CNTY TX HSG FIN CORP MF 12/1/2036 9.250 916,997 655,001
650,000 BI STATE DEV AGY MO IL MET 10/1/2033 5.250 652,153 594,523
350,000 BIRMINGHAM BAPTIST MED CTR AL 11/15/2030 5.000 357,669 202,671
140,000 BIRMINGHAM SOUTHERN COLLEGE AL 12/1/2025 6.125 142,796 100,734
500,000 BIRMINGHAM SOUTHERN COLLEGE AL 12/1/2019 5.350 505,179 379,805
350,000 BISHOP INTL ARPT AUTH MI 12/1/2017 5.125 346,673 299,999
494,528 BISMARCK STATE COLLEGE 4/1/2032 5.010 503,354 476,453
300,000 BLOUNT CNTY TN HEALTH + EDL 4/1/2012 4.750 299,451 276,153
250,000 BLUE ASH OH TAX INCREMENT 12/1/2021 5.000 253,243 215,500
250,000 BLYTHE CAREDEV AGY REDEV PROJ 5/1/2028 5.800 200,181 172,528
500,000 BOONE CNTY IND REDEV DIST TAX 8/1/2023 5.375 506,006 386,910
750,000 BOONE CNTY IND REDEV DIST TAX 8/1/2028 5.000 740,748 504,555
500,000 BOONE CNTY MO HOSP REV 8/1/2028 5.750 518,599 412,885
700,000 BOSTON MAREV 10/1/2031 6.125 702,016 705,215
750,000 BRAZOS CNTY TX HEALTH FAC DEV 1/1/2032 5.375 772,394 538,013
500,000 BRAZOS CNTY TX HEALTH FAC DEV 1/1/2033 5.500 505,888 364,405
400,000 BRAZOS RIV TX HBR NAV DIST 5/15/2033 4.950 400,000 240,356
500,000 BREVARD CNTY FL HEALTH FACS 4/1/2036 5.000 466,228 299,395
253,000 BRIDGEVILLE DEL SPL OBLIG 7/1/2035 5.125 253,000 159,109
250,000 BROWNSBURG IND REDEV AUTH ECON 2/1/2029 4.700 250,000 220,043
250,000 BROWNSBURG IND REV AUTH 8/1/2024 4.625 250,000 219,513
75,000 BROWNSVILLE TX (c) 2/15/2011 4.890 67,128 66,425
960,000 BUCKEYE OH TOB SETTLEMENT 6/1/2024 5.125 920,671 640,973
165,000 BULLHEAD CITY AZ SPL ASSMT 1/1/2010 6.100 165,876 165,111
750,000 BUNCOMBE CNTY NC PROJ DEVFING 8/1/2024 6.750 736,519 585,953
250,000 BURKE CNTY GA DEV AUTH POLLUTN 10/1/2032 4.375 250,000 249,113
750,000 BURLINGTON KS POLLUTN CTL REV 6/1/2031 5.300 758,770 565,935
395,000 BUTLER CNTY PA 10/1/2034 3.301 395,000 205,400
See accompanying notes to financial statements. 35 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Percent
Maturity Coupon Fair of
Par/Shares Security date rate Cost Value (a) net assets
- ----------- --------------------------------------------- ---------- -------- -------------- ------------- ----------
365,000 CALIFORNIA CMNTYS HSG FIN AGY 10/1/2011 5.000 364,600 341,837
180,000 CALIFORNIA CMNTYS HSG FIN AGY 12/1/2011 5.000 179,792 166,903
150,000 CALIFORNIA CMNTYS HSG FIN AGY 8/1/2012 4.650 149,781 137,492
260,000 CALIFORNIA CMNTYS HSG FIN AGY 11/1/2012 4.850 259,241 237,617
165,000 CALIFORNIA CNTY 6/1/2023 5.625 158,166 149,845
500,000 CALIFORNIA CNTY CA 6/1/2036 5.000 494,836 265,795
175,000 CALIFORNIA CNTY CA TOB SECTZTN 6/1/2021 4.500 172,867 129,015
310,000 CALIFORNIA CNTY CALIF TOB 6/1/2019 4.750 300,698 282,128
500,000 CALIFORNIA HEALTH FACS FING 4/1/2010 5.300 506,545 503,350
500,000 CALIFORNIA HEALTH FACS FING AU 3/1/2033 5.000 505,588 363,810
500,000 CALIFORNIA HSG FIN AGY REV 8/1/2033 5.450 480,340 451,225
750,000 CALIFORNIA MUN FIN AUTH ED REV 6/1/2026 5.250 744,287 491,573
40,000 CALIFORNIA ST 10/1/2020 5.250 41,014 40,013
120,000 CALIFORNIA ST DEPT WTR RES CEN 12/1/2027 5.375 125,213 116,324
1,000,000 CALIFORNIA ST PUB WKS LEASE 3/1/2016 5.625 975,546 1,002,340
620,000 CALIFORNIA STATEWIDE CMNTY DEV 11/20/2036 6.150 657,893 653,486
350,000 CALIFORNIA STATEWIDE CMNTYS 9/1/2029 6.000 350,000 243,639
500,000 CALIFORNIA STATEWIDE CMNTYS 5/15/2032 5.750 492,995 331,365
750,000 CALIFORNIA STATEWIDE CMNTYS 4/1/2037 5.125 757,734 413,685
750,000 CALIFORNIA STATEWIDE CMNTYS 6/1/2017 5.400 747,457 572,828
750,000 CALIFORNIA STATEWIDE CMNTYS 3/1/2035 5.000 757,364 521,768
200,000 CALIFORNIA STATEWIDE CMNTYS DE 4/20/2036 7.000 200,000 205,948
350,000 CAMBRIDGEPA AREA JT AUTH 12/1/2028 5.625 341,580 296,338
1,250,000 CAMERON TX ED CORP REV 8/15/2021 5.000 1,069,684 829,138
80,000 CAPE GIRARDEAU CNTY MO INDL 6/1/2032 5.750 82,991 61,044
750,000 CAPITAL TR AGY FL MULTIFAMILY 6/1/2038 5.875 763,477 397,463
410,000 CAPITAL TR AGY FLA MULTIFAMILY 6/1/2013 4.750 410,000 338,697
1,332,000 CARLSBAD NM INDL DEV REV 4/15/2021 5.750 1,370,634 1,051,068
105,000 CARSON CITY NV HOSP REV 9/1/2031 5.750 109,467 118,519
125,000 CARSON CITY NV HOSP REV 9/1/2031 5.750 130,317 86,206
750,000 CARTHAGE MO HOSP REV 4/1/2010 4.500 744,196 727,725
1,000,000 CENTER UNIV SCH DIST CA (c) 8/1/2031 6.074 260,757 206,880
900,000 CENTINELAVALLEY CA UN HIGH 8/1/2033 5.500 912,296 817,830
595,000 CHANDLER PARK ACADEMY MICH PUB 11/1/2022 5.000 427,407 426,044
270,000 CHARLESTON CNTY SC HOSP FACS 10/1/2019 5.500 277,527 275,073
400,000 CHARTIERSVALLEY PA INDL + 8/15/2012 5.000 398,026 378,084
200,000 CHATHAM CNTY GA HOSP AUTH REV 1/1/2016 5.250 200,800 191,252
500,000 CHATHAM CNTY GA HOSP AUTH REV 1/1/2034 5.500 520,947 292,695
500,000 CHEROKEE NATION OK HLTHCARE 12/1/2021 4.600 500,000 382,880
450,000 CHESTERFIELD CNTY VA INDL DEV 7/1/2019 5.200 414,983 451,202
250,000 CHESTERFIELD CNTY VA INDL DEV 6/1/2017 5.875 256,087 256,970
20,000 CHICAGO IL MET HSG DEV CORP 7/1/2022 6.850 20,603 20,015
500,000 CITIZEN POTAWATOMI NATION OK 9/1/2016 6.500 500,000 458,765
250,000 CLARK CNTY NV ECONOMIC DEV REV 5/15/2033 5.375 254,381 215,675
455,000 CLARK CNTY NV IMPT DIST 2/1/2019 5.000 456,770 262,790
500,000 CLARK CNTY NV POLLUTN CTL REV 10/1/2011 5.300 500,000 449,795
1,155,000 CLEVELANDCUYAHOGA CNTY OH 5/15/2023 5.250 1,024,983 844,836
750,000 CO HSG FIN AUTH SINGLE FAMILY 11/1/2034 5.000 750,119 730,110
485,000 COLLIER CNTY FL HSG FIN AUTH 8/15/2015 5.250 483,256 490,083
195,000 COLORADO EDL + CULTURAL FACS 6/15/2012 4.625 192,867 182,752
835,000 COLORADO EDL + CULTURAL FACS 11/15/2028 6.750 835,000 805,324
1,000,000 COLORADO EDL CULTURAL FACS 6/1/2033 5.500 973,721 816,890
40,000 COLORADO HEALTH FACS AUTH REV 12/1/2010 6.250 40,000 41,406
600,000 COLORADO HEALTH FACS AUTH REV 9/15/2022 5.000 593,509 456,048
20,000 COLORADO HEALTH FACS AUTH REV 11/15/2020 5.125 19,780 23,519
280,000 COLORADO HEALTH FACS AUTH REV 11/15/2020 5.125 276,916 252,762
750,000 COMPARK BUSINESS CAMPUS 12/1/2027 5.750 765,651 625,350
260,000 CONCORDE ESTATES CMNTY DEV DIS 5/1/2011 5.000 259,430 156,224
1,250,000 CONNECTICUT ST DEV AUTH POLLTN 9/1/2028 5.850 1,321,474 1,039,488
500,000 CONNECTICUT ST HEALTH + EDL 7/1/2025 6.000 507,407 406,710
450,000 CONNECTICUT ST HLTH + EDL FAC 7/1/2015 5.250 454,027 441,279
375,000 CONNERTONW CMNTY DEV DIST FL 5/1/2016 5.125 374,405 226,928
380,000 COOK CNTYILL SCH DIST NO 148 12/1/2027 4.500 351,435 335,240
225,000 COOLIDGE AZ UNI SCH DIST 10/1/2010 4.150 224,624 225,241
637,000 CORTLAND IL SPL TAX REV 3/1/2017 5.500 631,862 383,863
975,000 CROW FIN AUTH MINN TRIBAL PUR 10/1/2017 5.650 931,051 986,008
500,000 CUYAHOGA CNTY OH HSG MTG REV 3/20/2042 5.700 514,813 456,460
3,474,000 DALLAS TXHSG FIN CORP 10/20/2032 6.750 3,458,808 3,522,567
225,000 DALTON GADEV AUTH REV 8/15/2026 5.250 226,969 175,280
See accompanying notes to financial statements. 36 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Percent
Maturity Coupon Fair of
Par/Shares Security date rate Cost Value (a) net assets
- ----------- --------------------------------------------- ---------- -------- -------------- ------------- ----------
241,948 DENHAM SPRINGS LIVN HSG + MTG 11/1/2040 5.000 251,733 225,994
750,000 DENVER COCONVENTION CTR 12/1/2026 5.125 782,748 588,653
500,000 DENVER COLO CONVENTION CTR 12/1/2030 5.000 512,737 362,480
400,000 DETROIT CMNTY HIGH SCH MI 11/1/2010 5.000 400,000 384,864
500,000 DETROIT LAKES MN HSG + HEALTH 8/1/2034 5.440 500,000 482,985
750,000 DETROIT MI 4/1/2020 5.250 754,983 660,233
500,000 DINUBA CAFING AUTH LEASE REV 9/1/2038 5.375 494,493 296,500
1,105,000 DIRECTOR ST NV DEPT BUSINESS 11/15/2014 6.000 1,094,199 680,945
500,000 DISTRICT COLUMBIA REV 6/1/2026 5.000 510,754 289,715
500,000 DORCHESTER CNTY S C SCH DIST 12/1/2029 5.250 505,147 476,790
435,000 DURBIN CROSSING CMNTY DEV 11/1/2010 4.875 434,786 283,633
500,000 E 470 PUBHWY AUTH CO REV 9/1/2024 5.500 507,201 417,775
240,000 EAST BATON ROUGE LA MTG FIN 10/1/2024 4.625 240,000 208,315
990,000 EAST POINT GA 2/1/2026 8.000 1,123,725 925,086
150,000 EAST ROCHESTER NY HSG AUTH REV 8/15/2028 5.250 157,546 136,314
800,000 EDEN PRAIRIE MN MLT FAM HSG 2/20/2043 6.200 873,846 792,080
250,000 EL PASO CNTY TEX HSG FIN CORP 12/1/2015 7.000 250,000 224,223
500,000 ELKHART CNTY IN HOSP AUTH REV 8/15/2020 5.250 507,431 441,875
500,000 ERIE CNTYOH HOSP FACS REV 8/15/2013 6.000 529,549 510,595
1,750,000 ERIE CNTYOH HOSP FACS REV 8/15/2032 5.625 1,768,420 1,364,440
500,000 ESTHERVILLE IA HOSP REV 7/1/2020 6.300 507,243 501,865
500,000 FAIRFAX CNTY VA REDEV + HSG 8/1/2039 5.600 500,000 457,785
2,956,188 FARGO N DUNIV FACS REV 11/29/2027 5.110 2,980,342 2,846,424
250,000 FARGO ND HEALTH SYS REV 6/1/2027 5.375 246,535 201,553
500,000 FARMINGTON N MEX HOSP REV 6/1/2022 5.000 509,608 403,925
750,000 FARMINGTON NM POLLUTN CTL REV 12/1/2016 5.700 750,000 652,583
250,000 FARMINGTON NM POLLUTN CTL REV 12/1/2016 6.300 250,000 215,898
170,000 FARMINGTON NM POLLUTN CTL REV 4/1/2022 5.800 173,372 128,139
747,000 FARMS NEWKENT VA 3/1/2036 5.125 747,000 384,571
315,000 FIDDLERS CREEK CMNTY DEV DIST 5/1/2013 5.750 313,502 278,107
400,000 FLAGSTAFFAZ 1/1/2022 5.000 400,961 369,172
1,000,000 FLAGSTAFFAZ INDL DEV AUTH 7/1/2022 5.500 910,971 694,230
500,000 FLORIDA HSG FIN CORP REV 7/1/2033 5.450 500,000 446,160
1,115,000 FOREST CREEK CMNTY DEV DIST 5/1/2011 4.850 1,114,371 833,652
1,000,000 FORT ML SC SCH FACS CORP 12/1/2029 5.250 992,619 823,940
500,000 FORT ML SC SCH FACS CORP 12/1/2030 5.250 496,922 407,195
1,000,000 FORT PIERCE FL CAP IMPT REV 9/1/2025 5.750 984,142 1,014,720
1,000,000 FRUITA COREV 1/1/2018 7.000 962,256 835,320
1,250,000 FULTON CNTY GA DEV AUTH 11/1/2028 5.250 1,072,556 821,313
330,000 FULTON CNTY PA INDL DEV AUTH 7/1/2011 5.375 329,490 311,121
325,000 GALVESTONCNTY TX HEALTH FACS 11/1/2014 5.000 330,508 317,356
1,059,836 GALVESTONCNTY TX MUN UTIL 8/12/2009 6.250 1,059,836 1,048,740
500,000 GARDEN GROVE CA CTFS PARTN 8/1/2023 5.700 512,660 501,910
400,000 GEISINGERAUTH PA HLTH SYS REV 5/1/2037 2.909 400,000 144,000
310,000 GENESEE CNTY NY INDL DEV 12/1/2014 4.750 310,000 263,413
15,000 GEORGIA MUN ELEC AUTH PWR REV (c) 1/1/2012 4.743 12,715 12,669
1,000,000 GOLDEN ST 6/1/2047 5.125 847,052 508,090
1,000,000 GOLDEN STTOB SECURITIZATION (c) 6/1/2022 1.294 841,071 809,400
250,000 GOSHEN INREDEV DIST TAX 1/1/2028 5.875 250,000 184,825
1,720,000 GRAND FORKS ND HLTH CARE FACS 12/1/2010 6.625 1,720,000 1,721,823
2,000,000 GRAND FORKS ND HLTH CARE SYS 8/15/2027 5.625 2,010,181 1,660,760
145,000 GRAVOIS BLUFFS TRANSN DEV MO 5/1/2018 4.000 143,880 111,767
250,000 GRAVOIS BLUFFS TRANSN DEV MO 5/1/2032 4.750 225,400 159,170
400,000 GROVE CITY PA AREA HOSP AUTH 7/1/2012 5.250 398,032 381,988
205,000 GROVE CITY PA AREA HOSP AUTH 7/1/2012 5.250 205,942 195,769
750,000 HAMILTON CNTY OH HEALTH CARE 1/1/2037 5.000 626,708 441,780
500,000 HAMMOND IND REDEV DIST REV 1/15/2017 6.000 500,000 425,505
320,000 HARRIS CNTY TEX MUN UTIL DIST 9/1/2018 5.000 320,711 309,334
500,000 HARRIS CNTY TX DEPT ED PUB FAC 2/15/2023 5.750 508,999 511,335
500,000 HARRIS CNTY TX HEALTH FACS 11/15/2032 5.000 483,734 461,965
250,000 HARRISONVILLE MO ANNUAL 11/1/2028 4.625 241,944 194,650
350,000 HARVEY IL 12/1/2027 5.500 358,892 303,457
1,000,000 HAWAII STDEPT BUDGET + FIN 11/15/2023 7.875 965,693 884,060
360,000 HEALTH CARE AUTH FOR BAPTIST H 11/15/2018 5.000 371,525 318,071
1,500,000 HENDERSONNV LOC IMPT DISTS 9/1/2010 4.500 1,500,000 1,126,230
105,000 HERITAGE ISLE AT VIERA CMNTY 11/1/2009 5.000 104,976 101,144
170,000 HERITAGE ISLE AT VIERA CMNTY 11/1/2013 5.000 169,688 139,862
255,000 HIGHLANDSCNTY FLA HEALTH FACS 11/15/2027 5.000 257,794 199,328
500,000 HILLSBOROUGH CNTY FL INDL DEV 10/1/2024 5.250 512,080 381,160
See accompanying notes to financial statements. 37 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Percent
Maturity Coupon Fair of
Par/Shares Security date rate Cost Value (a) net assets
- ----------- --------------------------------------------- ---------- -------- -------------- ------------- ----------
500,000 HIMALAYA WTR + SANTN DIST CO 12/1/2035 5.000 513,317 390,515
2,500,000 HOPKINS CNTY KY HOSP REV 11/15/2011 6.625 2,476,361 2,479,550
500,000 HOPKINS CNTY TX HOSP DIST HOSP 2/15/2023 5.500 487,507 374,095
399,000 HOUMA TERR PUB TR FINAUTH LA 12/1/2040 5.150 417,033 377,570
250,000 HOWARD CNTY MD RETIREMENT 4/1/2027 5.250 256,043 148,450
500,000 HUNTSVILLE AL HEALTH CARE AUTH 6/1/2022 5.625 523,010 436,240
400,000 HUNTSVILLE REDSTONE VLG AL 1/1/2015 5.250 400,000 335,712
500,000 HURON CNTY OH HOSP FACS REV 12/1/2022 5.000 502,026 422,805
120,000 IDAHO HEALTH FACS AUTH HOSP 8/1/2009 5.750 120,162 119,152
110,000 IDAHO HEALTH FACS AUTH HOSP 8/1/2010 6.000 110,310 104,136
245,000 IDAHO HSG+ FIN ASSN 8/1/2017 6.250 245,000 200,006
165,000 IDAHO HSG+ FIN ASSN NON PROFI 8/1/2010 5.750 165,000 158,945
250,000 IDAHO HSG+ FIN ASSN NONPROFIT 6/1/2021 5.500 250,000 195,470
250,000 IDAHO HSG+ FIN ASSN NONPROFIT 7/1/2021 5.625 249,211 196,858
500,000 IDAHO HSG+ FIN ASSN SINGLE 7/1/2040 5.500 500,000 443,935
250,000 IDAHO HSGFIN ASSN NONPROFIT 12/1/2018 5.500 247,161 197,913
170,000 ILLINOIS DEV FIN AUTH POLLUTN 2/1/2024 5.700 174,164 147,533
730,000 ILLINOIS DEV FIN AUTH POLLUTN 3/1/2014 5.500 736,896 624,588
250,000 ILLINOIS DEV FIN AUTH REV 5/15/2021 5.500 259,308 221,778
215,000 ILLINOIS DEV FIN AUTH REV 7/1/2009 5.900 215,545 215,918
135,000 ILLINOIS DEV FIN AUTH REV 7/1/2019 6.050 135,695 122,542
500,000 ILLINOIS EDL FACS AUTH REVS 10/1/2032 5.700 501,720 360,985
750,000 ILLINOIS EDL FACS AUTH REVS 8/15/2028 5.375 736,629 585,300
500,000 ILLINOIS EDL FACS AUTH REVS 8/1/2017 5.250 506,909 473,210
400,000 ILLINOIS FIN 11/15/2016 5.400 396,183 310,032
500,000 ILLINOIS FIN 3/15/2027 5.000 523,091 442,245
600,000 ILLINOIS FIN AUTH ED REV 9/1/2027 5.000 567,685 350,418
600,000 ILLINOIS FIN AUTH REV 5/15/2012 5.250 602,722 532,932
750,000 ILLINOIS FIN AUTH REV 5/15/2026 5.750 727,497 486,308
1,250,000 ILLINOIS FIN AUTH REV 11/15/2022 5.250 1,247,462 1,015,975
250,000 ILLINOIS FIN AUTH REV 11/15/2026 5.750 252,581 203,800
875,000 ILLINOIS FIN AUTH REV 2/1/2037 5.250 873,202 597,686
500,000 ILLINOIS FIN AUTH REV 2/15/2038 5.875 506,167 279,110
500,000 ILLINOIS FIN AUTH REV 11/15/2016 5.000 513,073 390,640
650,000 ILLINOIS FIN AUTH REV 5/15/2015 5.250 658,752 549,049
250,000 ILLINOIS FIN AUTH REV 5/15/2038 5.750 257,311 138,455
500,000 ILLINOIS FIN AUTH REV 5/15/2012 5.100 498,462 451,850
750,000 ILLINOIS FIN AUTH REV 11/15/2035 5.000 750,000 715,680
250,000 ILLINOIS FIN AUTH REV 12/1/2021 5.000 256,058 182,403
150,000 ILLINOIS FIN AUTH REV 12/1/2036 5.000 151,848 86,448
375,000 ILLINOIS FIN AUTH REV 4/1/2026 5.000 381,747 269,014
610,000 ILLINOIS FIN AUTH REV 8/15/2026 6.000 625,206 407,578
500,000 ILLINOIS FIN AUTH REV 5/15/2029 5.250 507,399 409,235
350,000 ILLINOIS FIN AUTH REV 8/15/2023 6.000 365,564 311,644
440,000 ILLINOIS FIN AUTH SPORTS FAC (b) 12/1/2035 7.000 436,617 300,766
1,000,000 ILLINOIS FN AUTH REV 11/15/2026 5.250 968,747 642,890
500,000 ILLINOIS HEALTH FACS AUTH REV 7/1/2033 6.000 522,491 414,775
2,100,000 ILLINOIS HEALTH FACS AUTH REV 8/15/2033 5.100 2,155,562 1,848,546
500,000 ILLINOIS HEALTH FACS AUTH REV 2/15/2037 5.150 501,862 437,070
500,000 ILLINOIS HSG DEV AUTH 7/1/2028 4.800 500,000 420,925
250,000 ILLINOIS ST SALES TAX REV 6/15/2009 5.000 250,802 250,773
750,000 ILLNOIS FIN AUTH SPORTS FAC RE 10/1/2027 6.125 729,636 528,915
500,000 ILLNOIS FIN AUTH SPORTS FAC RE 10/1/2037 6.250 483,811 330,220
250,000 INDEPENDENCE CNTY AR POLLUTN 7/1/2022 4.900 250,000 200,595
250,000 INDEPENDENCE MO THIRTY NINTH 9/1/2032 6.875 250,000 185,828
500,000 INDIANA HEALTH + EDL FAC 2/15/2036 5.250 502,987 339,815
1,750,000 INDIANA HEALTH + EDL FAC 3/1/2022 5.500 1,605,921 1,398,215
250,000 INDIANA HEALTH + EDL FAC FING 11/15/2025 5.250 255,243 199,580
1,000,000 INDIANA HEALTH + EDL FAC FING 2/15/2030 5.250 729,743 710,300
620,000 INDIANA HLTH FAC FING AUTH REV 8/15/2009 4.750 613,461 621,748
1,315,000 INDIANA HLTH FAC FING AUTH REV 8/15/2018 5.000 1,167,150 1,155,241
350,000 INDIANA HLTH FAC HOSP REV 2/15/2018 5.250 359,252 329,277
280,000 INDIANA ST DEV FIN AUTH POLLUT 3/1/2030 5.000 280,964 253,820
500,000 INDIANIA HEALTH EDL FAC FING 11/15/2035 5.250 475,205 358,915
250,000 INDUSTRY CA URBAN DEV AGY 5/1/2021 4.750 254,472 200,323
300,000 INTERCOMMUNITY HOSP AUTH CA CT 11/1/2019 5.250 310,984 241,959
200,000 INTERLOCKEN MET DIST CO 12/15/2019 5.750 205,197 165,072
5,905,605 INTERMEDIATE SCH DIST 287 MN 11/1/2032 5.295 5,647,366 4,712,260
1,006,688 INTERMEIDIATE SCH DIST 287 MN 1/1/2028 4.780 1,027,351 814,834
See accompanying notes to financial statements. 38 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Percent
Maturity Coupon Fair of
Par/Shares Security date rate Cost Value (a) net assets
- ----------- --------------------------------------------- ---------- -------- -------------- ------------- ----------
200,000 IOWA FIN AUTH RETIREMENT CMNTY 11/15/2009 4.250 199,577 195,328
200,000 IOWA FIN AUTH RETIREMENT CMNTY 11/15/2011 4.750 198,675 188,062
175,000 IOWA FIN AUTH SR HSG REV 11/1/2011 5.000 175,000 165,337
400,000 IOWA FIN AUTH SR HSG REV 12/1/2014 5.000 397,344 321,228
500,000 IOWA FIN AUTH SR LIVING FAC 11/15/2027 5.500 510,905 290,230
500,000 JACKSON TN HOSP REV 4/1/2038 5.625 494,672 418,350
500,000 JACKSONVILLE FL HLTH FACS REV 11/1/2022 5.000 495,058 393,290
1,000,000 JACKSONVILLE FL HLTH FACS REV 11/1/2027 5.000 956,516 707,840
500,000 JASPER CNTY IN POLLUTN CTL REV 11/1/2016 5.600 500,000 483,995
1,500,000 JEFFERSONCNTY KY MTG REV 11/15/2013 6.125 1,500,000 1,426,485
240,000 JEFFERSONPARISH LA FIN AUTH 6/1/2033 5.000 253,019 222,031
250,000 JEFFERSONPARISH LA FIN AUTH 12/1/2048 5.700 263,179 247,113
1,250,000 JEFFERSONPARISH LA FIN AUTH R 6/1/2038 5.000 1,314,620 1,093,263
700,000 JOPLIN MOINDL DEV AUTH 5/15/2017 5.500 709,318 528,129
265,000 JUBAN PARK CMNTY DEV DIST LA 10/1/2014 5.150 265,000 211,009
2,500,000 KALISPEL TRIBE INDIANS WA 1/1/2016 6.200 2,431,557 2,147,825
1,000,000 KATY TX DEV AUTH REV 6/1/2011 5.800 985,924 969,270
1,000,000 KENT HOSPFIN AUTH MICH REV 7/1/2035 6.000 1,064,224 667,560
750,000 KENTUCKY ECONOMIC DEV FIN AUTH 10/1/2018 6.000 727,393 688,358
500,000 KENTUCKY ECONOMIC DEV FIN AUTH 11/20/2035 5.375 500,000 456,030
200,000 KENTUCKY ECONOMIC DEV FIN AUTH 12/1/2033 6.000 198,445 197,190
250,000 KENTWOOD MI ECONOMIC DEV 11/15/2014 5.250 248,355 219,728
2,750,000 KERRVILLETEX HEALTH FACS 8/15/2035 5.450 2,739,568 1,829,850
750,000 KING CINTY WA HSG AUTH REV 5/1/2028 5.200 750,000 677,850
900,000 KLICKITATCNTY WA PUB HOSP 12/1/2020 6.000 825,424 695,952
500,000 KNOX CNTYTN HEALTH EDL + HSG 4/1/2027 5.250 515,155 342,005
750,000 KNOX CNTYTN HLTH EDL HOSP FAC 4/15/2031 6.500 633,831 664,478
500,000 LA VERNIATX HIGHER ED FIN COR 2/15/2018 6.000 500,000 416,790
2,021,000 LAFAYETTELA PUB TR FING AUTH 1/1/2041 5.350 2,083,871 1,936,866
395,000 LAKE ASHTON II CMNTY DEV DIST 11/1/2010 4.875 395,320 362,634
650,000 LAKELAND FL HOSP SYS REV 11/15/2032 5.000 661,354 428,838
250,000 LAKELAND FL RETIREMENT CMNTY 1/1/2019 5.875 250,000 203,493
750,000 LAKESIDE 370 LEVEE DIST MO 4/1/2028 7.000 750,000 579,323
500,000 LANCASTERCNTY PA HOSP AUTH 7/1/2022 6.100 498,611 416,115
400,000 LANCASTERCNTY PA HOSP AUTH 7/1/2012 5.200 399,735 373,588
400,000 LANGSTON OK ECONOMIC DEV AUTH 5/1/2026 5.250 413,818 252,808
250,000 LEE CNTY FL INDL DEV AUTH 11/15/2029 5.000 255,649 145,243
750,000 LEE CNTY FL INDL DEV AUTH REV 6/15/2027 5.250 754,519 452,415
350,000 LEE CNTY FL WTR + SWR REV 10/1/2027 5.000 353,902 316,733
900,000 LEE CNTY S C SCH FACS INC 12/1/2031 6.000 866,952 747,702
250,000 LEHIGH CNTY PA GEN PURP AUTH 8/15/2042 2.460 250,000 77,500
200,000 LEWISVILLE TX COMBINATION CONT 9/1/2028 5.700 129,679 112,612
45,000 LEWISVILLE TX INDPT SCH DIST 8/15/2025 5.000 45,648 45,265
550,000 LOMBARD IL PUB FACS CORP REV 1/1/2030 5.500 579,849 318,786
1,750,000 LOMBARD IL PUB FACS CORP REV 1/1/2036 5.250 1,785,563 1,493,940
500,000 LOMBARD IL PUB FACS CORP REV 1/1/2015 6.375 500,000 421,770
300,000 LOMBARD ILL PUB FACS CORP 1/1/2025 5.500 318,557 186,648
250,000 LOMPOC CAHLTHCARE DIST 8/1/2034 5.000 253,643 220,168
320,000 LORAIN CNTY OH HOSP REV 9/1/2016 5.625 324,931 323,805
330,000 LORAIN CNTY OH HOSP REV 9/1/2027 5.500 336,388 269,788
500,000 LOS ANGELES CA CTFS PARTN 2/1/2018 5.700 435,530 434,705
1,250,000 LOS ANGELES CA HSG AUTH 6/1/2029 5.000 1,086,845 902,800
400,000 LOUDOUN CNTY VA DEV INDL AUTH 8/1/2028 5.000 400,000 399,340
1,720,000 LOUISIANAHSG FIN AGY 12/1/2038 5.700 1,818,575 1,703,333
235,000 LOUISIANAHSG FIN AGY SINGLE 10/1/2022 4.800 235,000 212,360
235,000 LOUISIANAHSG FIN AGY SINGLE 6/1/2039 5.600 243,299 212,247
500,000 LOUISIANAHSG FIN AGY SINGLE 6/1/2040 6.550 530,631 522,680
385,000 LOUISIANAHSG FIN AGY SINGLE F 6/1/2038 5.850 414,915 394,105
400,000 LOUISIANALOC GOVT ENV FACS 11/1/2032 6.750 400,000 219,516
475,000 LOUISIANALOC GOVT ENVIR FACS 6/20/2028 8.000 475,000 357,305
500,000 LOUISIANAPUB FACS AUTH REV 7/1/2024 5.250 504,230 413,285
500,000 LOUISIANAPUB FACS AUTH REV 2/15/2036 2.140 500,000 270,000
250,000 LOUISVILLE/JEFFERSON CNTY KY 5/1/2033 6.000 244,656 196,183
650,000 LOWER COLO RIV AUTH TX REV 5/15/2037 5.750 673,774 616,083
55,000 LUBBOCK TX HLTH FACS DEV CORP 1/20/2010 5.000 55,000 55,528
140,000 LUBBOCK TX HLTH FACS DEV CORP 3/20/2012 5.000 140,000 144,190
350,000 LUCAS CNTY OH HEALTH CARE FAC 8/15/2015 6.375 341,886 348,758
150,000 LYNN HAVEN FL CAP IMPT REV 12/1/2016 5.000 150,000 150,365
626,479 LYONS CO REV 11/30/2016 4.750 632,827 515,949
See accompanying notes to financial statements. 39 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Percent
Maturity Coupon Fair of
Par/Shares Security date rate Cost Value (a) net assets
- ----------- --------------------------------------------- ---------- -------- -------------- ------------- ----------
250,000 MADEIRA CMNTY DEV DIST FL 11/1/2014 5.250 249,491 132,200
460,000 MADISON CNTY FL REV 7/1/2025 6.000 452,895 334,760
230,000 MADISON CNTY NY INDL DEV AGY 2/1/2017 4.500 226,467 191,990
250,000 MAGNOLIA CREEK CMNTY DEV DIST 5/1/2014 5.600 250,000 150,460
500,000 MAIN STR NAT GAS INC GA GAS 7/15/2017 5.500 483,438 63,900
1,000,000 MALTA ILLTAX INCREMENT REV 12/30/2025 5.750 1,000,000 556,780
500,000 MANCHESTER N H HSG + REDEV (c) 1/1/2020 5.248 276,707 235,825
250,000 MANCHESTER NH HSG + REDEV 1/1/2015 6.750 263,775 247,640
647,000 MANHATTANIL 3/1/2022 5.750 647,000 391,868
500,000 MANITOWOCWI ELEC REV 10/1/2034 5.250 514,234 468,485
500,000 MAPLE GROVE MN HEALTH CARE REV 9/1/2029 5.000 505,625 354,005
500,000 MARICOPA CNTY AZ ELEM SCHDIST 7/1/2020 6.250 514,366 550,055
1,000,000 MARICOPA CNTY AZ UNI SCH DIST 7/1/2026 6.250 1,021,420 1,054,920
100,000 MARION CNTY IN CNVTN + RECTL 6/1/2027 5.000 101,939 84,545
2,500,000 MARION CNTY OH HLTH CARE FAC 11/15/2010 6.375 2,471,373 2,462,750
750,000 MARKHAM IL 2/1/2018 4.750 731,057 616,058
500,000 MARQUIS CMNTY DEV AUTH VA REV 9/1/2013 5.100 500,000 440,105
180,000 MARYLAND ST ECONOMIC DEV CORP 12/1/2011 4.750 179,028 158,281
750,000 MARYLAND ST HEALTH + HIGHER 1/1/2013 4.750 750,000 668,655
250,000 MARYLAND ST HEALTH + HIGHER 1/1/2017 5.000 250,000 184,790
500,000 MARYLAND ST HEALTH + HIGHER ED 1/1/2027 4.625 460,657 381,000
500,000 MASHANTUCKET WSTRN PEQUOT 9/1/2036 5.500 509,334 296,360
250,000 MASSACHUSETTS ST 5/1/2037 2.709 250,000 125,000
275,000 MASSACHUSETTS ST HEALTH 7/1/2028 5.000 283,132 231,913
464,000 MASSACHUSETTS ST HEALTH + EDL 10/1/2017 6.000 470,766 407,522
750,000 MASSACHUSETTS ST HEALTH + EDL 7/1/2016 5.500 763,672 625,793
1,250,000 MASSACHUSETTS ST HEALTH EDL 1/15/2012 5.125 1,243,867 1,156,988
3,000,000 MASSACHUSETTS ST HLTH + ED FAC 7/1/2013 7.300 3,002,116 3,003,870
350,000 MASSACHUSETTS ST HLTH EDL FACS 11/15/2009 5.125 351,307 346,973
1,000,000 MASSACHUSETTS ST HSG FIN 12/1/2033 5.350 1,000,000 888,170
750,000 MASSACHUSETTS ST INDL FIN AGY 10/1/2023 5.000 769,282 753,390
100,000 MASSACHUSETTS ST INDL FIN AGY 9/1/2017 5.450 100,598 97,315
500,000 MASSACHUSETTS ST TPK AUTH MET 1/1/2017 5.125 508,850 475,265
145,000 MASSACHUSETTS ST TPK AUTH MET 1/1/2027 5.000 147,284 113,650
225,000 MASSACHUSETTS ST TPK AUTH MET 1/1/2029 5.250 231,694 177,172
460,000 MASSACHUSETTSC ST DEV FIN AGY 10/1/2017 5.000 468,133 384,459
265,000 MATAGORDACNTY TX NAV DIST 1 6/1/2026 5.250 271,051 212,024
80,000 MATAGORDACNTY TX NAV DIST 1 6/1/2026 5.250 81,087 74,714
1,000,000 MATTESON IL TAX INCREMENT REV 12/1/2009 4.250 1,000,000 971,620
1,750,000 MC ALESTER OKLA PUB WKS AUTH (c) 2/1/2030 5.480 557,614 452,445
200,000 MEAD VLG NE TAX INCREMENT REV 7/1/2012 5.125 200,000 135,024
500,000 MERRILLVILLE IN MLT SCH BLDG 7/15/2027 5.250 494,141 472,255
500,000 MESQUITE TX HEALTH FACS DEV 2/15/2015 5.000 502,589 414,140
855,000 MET GOVT NASHVILLE DAVIDSON TN (b) 6/20/2036 10.000 855,000 533,520
1,835,000 MET GOVT NASHVILLE DAVIDSON TN 12/20/2040 7.500 1,835,000 1,304,612
1,070,000 MET GOVT NASHVILLE DAVIDSON TN 12/20/2020 8.000 1,070,000 876,854
500,000 METROPOLITAN PIER + EXPO IL 6/15/2027 6.500 500,835 500,780
500,000 MIAMI BEACH FL HLTH FACS HOSP 11/15/2028 5.375 505,714 265,940
500,000 MIAMI CNTY OH HOSP FACS REV 5/15/2018 5.250 511,299 404,345
750,000 MIAMI DADE CNTY FL WTR SWR REV 10/1/2023 6.000 763,201 777,360
250,000 MICH TOB STLMT FIN AUTH 6/1/2022 5.125 241,166 176,143
300,000 MICHIGAN PUB EDL FACS AUTH 9/1/2022 5.000 300,000 211,563
750,000 MICHIGAN PUB EDL FACS AUTH REV 9/1/2016 6.000 750,000 668,520
500,000 MICHIGAN PUB EDL FACS AUTH REV 10/1/2023 6.250 500,000 376,390
500,000 MICHIGAN PUB EDL FACS AUTH REV 11/1/2028 6.350 500,000 370,215
1,000,000 MICHIGAN ST BLDG AUTH REV (c) 10/15/2023 5.550 446,759 411,690
220,000 MICHIGAN ST HOSP FIN AUTH REV 11/15/2009 4.000 218,939 214,269
175,000 MICHIGAN ST HOSP FIN AUTH REV 6/1/2028 5.000 178,239 129,973
500,000 MICHIGAN ST HOSP FIN AUTH REV 5/15/2028 5.625 489,845 413,605
1,000,000 MICHIGAN ST HOSP FIN AUTH REV 12/1/2023 6.125 987,937 1,008,060
625,000 MICHIGAN ST HSG DEV RENTAL REV 10/1/2020 5.375 594,783 586,175
545,000 MICHIGAN ST HSG DEV RENTAL REV 10/1/2038 5.700 545,000 495,149
1,000,000 MICHIGAN ST STRATEGIC FD 9/1/2029 5.450 1,058,524 913,190
500,000 MIDCITIESMET DIST NO 2 CO 12/1/2030 5.125 500,666 332,910
1,000,000 MIDLOTHIAN TEX DEV AUTH 11/15/2016 5.000 996,739 895,410
500,000 MILLSBORODE SPL OBLG 7/1/2036 5.450 500,000 271,395
585,396 MINNESOTAST HIGHER ED FACS 10/1/2016 4.493 590,092 596,132
250,000 MINNESOTAST HSG FIN AGY 1/1/2020 5.000 238,772 243,403
1,000,000 MISSISSIPPI DEV BK SPL 10/1/2013 5.000 1,023,256 963,700
See accompanying notes to financial statements. 40 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Percent
Maturity Coupon Fair of
Par/Shares Security date rate Cost Value (a) net assets
- ----------- --------------------------------------------- ---------- -------- -------------- ------------- ----------
250,000 MISSISSIPPI HOME CORP SINGLE 12/1/2039 5.050 250,000 207,088
500,000 MISSISSIPPI HOME CORP SINGLE 6/1/2039 6.750 533,609 526,240
500,000 MISSOURI ST DEV FIN BRD FACS 4/1/2027 6.000 508,355 415,000
250,000 MISSOURI ST DEV FIN BRD FACS 4/1/2025 5.125 253,084 222,583
500,000 MISSOURI ST DEV FIN BRD FACS 4/1/2028 4.750 484,623 409,145
500,000 MISSOURI ST HLTH + EDL FAC AUT 2/1/2027 4.875 505,822 353,235
980,000 MISSOURI ST HLTH + EDL FAC AUT 2/1/2022 5.125 1,012,287 799,004
500,000 MISSOURI ST HSG DEV COMMN 9/1/2034 5.250 496,512 435,865
500,000 MODESTO CA IRR DIST CTFS PARTN 7/1/2022 5.300 471,263 483,395
1,000,000 MOHAVE CNTY AZ INDL DEV AUTH 5/1/2015 7.250 990,990 976,410
290,000 MONROE MCKEEN PLAZA HSG DEV LA 2/1/2012 6.800 291,125 290,409
1,550,000 MONTANA ST BRD HSG 12/1/2039 5.500 1,550,302 1,378,183
250,000 MONTGOMERY AL EDL BLDG AUTH 10/1/2032 5.250 260,971 181,410
250,000 MONTGOMERY AL MED CLNIC BRD 3/1/2031 5.250 255,972 165,395
1,500,000 MONTGOMERY CNTY OH HLTH CARE 9/20/2032 6.550 1,456,019 1,449,960
500,000 MONTGOMERY CNTY PA INDL DEV RE 12/1/2017 6.250 498,814 407,175
650,000 MONTGOMERY CNTY PA INDL DEV RE 2/1/2014 5.375 646,434 546,501
375,000 MONTGOMERY CNTY PA INDL DEV RE 2/1/2028 6.125 369,810 237,518
247,000 MONTGOMERY IL SPL ASSMT 3/1/2030 4.700 247,209 152,550
800,000 MOUNT CARBON MET DIST CO REV 6/1/2043 7.000 800,000 518,672
200,000 MOUNT CARBON MET DIST CO REV (b)(e) 6/1/2043 8.000 0 0
400,000 NASSAU CNTY N Y INDL DEV AGY 1/1/2018 5.875 396,551 320,996
140,000 NEW HAMPSHIRE HEALTH + ED 7/1/2011 5.000 140,552 133,021
480,000 NEW HAMPSHIRE HEALTH + ED 7/1/2016 5.000 478,200 407,803
185,000 NEW HAMPSHIRE HEALTH + ED FACS 7/1/2014 5.000 185,514 178,494
570,000 NEW HAMPSHIRE HIGH EDL + HLTH 10/1/2010 5.700 570,000 571,169
1,000,000 NEW HAMPSHIRE ST HSG FIN AUTH 7/1/2038 6.625 1,059,400 1,049,440
300,000 NEW JERSEY ECONOMIC DEV AUTH 1/1/2015 5.000 296,933 255,783
235,000 NEW JERSEY HEALTH CARE FACS 2/1/2021 5.000 241,572 226,625
500,000 NEW JERSEY HEALTH CARE FACS 7/1/2015 5.750 490,685 434,320
490,000 NEW JERSEY HEALTH CARE FACS FI 11/15/2033 2.240 490,000 298,900
35,000 NEW MEXICO MTG FIN AUTH 1/1/2026 6.950 36,794 35,837
250,000 NEW MEXICO ST HOSP EQUIP LN 8/15/2017 5.000 249,124 182,663
230,000 NEW ORLEANS LA SEW SVC REV 6/1/2010 5.200 231,569 230,156
500,000 NEW RIVERCMNTY DEV DIST FLA 5/1/2013 5.000 498,671 200,000
190,000 NEW YORK CNTYS TOB TR IV 6/1/2021 4.250 188,182 166,035
640,000 NEW YORK NY CITY HSG DEV CORP 11/1/2024 5.100 544,888 603,437
990,000 NEW YORK ST DORM AUTH 7/1/2015 6.050 993,787 990,891
3,250,000 NEW YORK ST DORM AUTH REVS 2/1/2034 6.600 3,250,000 3,250,975
1,000,000 NEW YORK ST DORM AUTH REVS 8/15/2024 6.450 998,264 1,023,790
350,000 NEW YORK ST DORM AUTH REVS 7/1/2019 6.875 370,035 316,288
750,000 NEW YORK ST DORM AUTH REVS 7/1/2029 6.250 763,359 788,250
1,000,000 NEW YORK ST MED CARE FACS 8/15/2023 6.300 1,000,915 1,001,800
1,820,000 NEW YORK ST MED CARE FACS FIN 2/15/2035 6.375 1,801,856 1,820,218
500,000 NOBLESVILLE IN REDEV AUTH 2/1/2031 5.125 495,081 460,580
250,000 NORTH CAROLINA 1/1/2032 5.250 248,662 134,245
500,000 NORTH CAROLINA MED CARE COMMN 10/1/2034 5.800 541,940 337,475
1,300,000 NORTH CAROLINA MED CARE HLTH 10/1/2035 4.750 1,300,000 1,236,859
500,000 NORTH CAROLINA MED CARE HLTH 10/1/2020 5.500 512,815 439,625
500,000 NORTH CAROLINA MUN PWR AGY 1/1/2020 6.500 501,721 512,135
1,000,000 NORTH CENT TX HLTH FAC DEV 5/15/2017 5.000 1,009,844 1,002,530
750,000 NORTH OAKS MN SR HSG REV 10/1/2022 5.750 739,485 527,498
350,000 NORTH RANGE MET DIST NO 1 CO 12/15/2024 5.000 362,283 214,316
1,000,000 NORTH TX TWY AUTH REV (c) 1/1/2028 5.900 331,310 299,460
250,000 NORTH TX TWY AUTH REV 1/1/2031 6.125 254,604 223,830
1,000,000 NORTH TX TWY AUTH REV (c) 1/1/2042 1.154 684,057 620,010
2,000,000 NORTH TX TWY AUTH REV 1/1/2038 5.500 2,000,000 1,990,300
500,000 NORTHEASTERN PA HOSP + ED AUTH 8/15/2016 5.150 502,068 470,305
500,000 NORTHERN CA GAS AUTH NO 1 7/1/2027 3.321 500,000 158,750
400,000 NORTHERN MARIANA ISLANDS 10/1/2022 5.000 403,461 265,216
220,000 NORTHRN CA PWR AGY PUB PWR REV 7/1/2032 5.200 224,371 183,366
250,000 OAKLAND CA UNI SCH DIST 8/1/2024 5.000 259,410 204,545
100,000 OAKRIDGE COMMUNITY DEVELOPMENT 5/1/2018 5.250 101,335 101,442
750,000 OHIO ST 9/1/2028 6.125 750,000 753,840
500,000 OHIO ST HIGHER ED FAC COMMN 5/1/2028 5.750 472,139 476,160
500,000 OHIO ST HSG AGY RESIDENT MTG R 9/1/2033 5.450 500,000 450,555
250,000 OKANOGAN CNTY WASH PUB HOSP 12/1/2023 5.625 263,330 240,403
35,000 OKLAHOMA DEV FIN AUTH REV 2/15/2029 6.000 36,669 34,257
See accompanying notes to financial statements. 41 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Percent
Maturity Coupon Fair of
Par/Shares Security date rate Cost Value (a) net assets
- ----------- --------------------------------------------- ---------- -------- -------------- ------------- ----------
1,000,000 OKLAHOMA HSG FIN AGY SINGLE 9/1/2038 6.500 1,065,386 1,043,170
500,000 OKLAHOMA ST INDS AUTH REV 7/1/2023 5.125 486,257 413,665
500,000 OLIVER CNTY ND POLLUTN CTL REV 1/1/2027 5.300 502,259 483,675
1,000,000 ORANGE CNTY FL HLTH FACS AUTH 10/1/2021 6.250 982,634 950,200
275,000 ORANGE CNTY FL HLTH FACS AUTH 7/1/2009 4.625 275,000 271,904
610,000 OREGON STHEALTH HSG EDL AUTH 11/15/2026 8.000 635,555 518,793
15,000 OREGON STHSG + CMNTY SVCS DEP 7/1/2022 5.700 15,088 15,129
500,000 ORLEANS PARISH LA PARSHWDE SCH 9/1/2020 5.500 500,000 500,135
520,000 ORLEANS PARISH LA SCH BRD (c) 2/1/2015 5.586 366,930 374,525
615,000 PALM BEACH CNTY FL HLTH FACS 10/1/2011 5.500 616,683 614,570
1,000,000 PALM BEACH CNTY FL HLTH FACS 11/15/2022 5.375 906,663 745,790
675,000 PALM BEACH FL HEALTH FACS 11/15/2029 5.125 683,813 420,593
240,000 PANTHER TRACE II FL CMNTY DEV 11/1/2010 5.000 240,598 222,840
400,000 PAOLI IN BLDG CORP 1/15/2032 5.000 405,256 355,784
630,000 PARKLANDSLEE CMNTY DEV DIST 5/1/2011 5.125 629,639 383,027
500,000 PELL CITYAL SPL CARE FACS FIN 12/1/2027 5.250 427,634 345,335
250,000 PENNSYLVANIA INTRGVRNMNTL COOP 6/15/2021 5.000 256,954 250,255
1,300,000 PENNSYLVANIA ST HIGHER EDL 3/15/2030 5.750 1,204,480 1,039,792
75,000 PENNSYLVANIA ST HIGHER EDL FAC 11/15/2016 5.875 79,325 57,050
50,000 PENNSYLVANIA ST HIGHER EDL FAC 11/15/2021 5.875 50,939 35,654
235,000 PENNSYLVANIA ST HIGHER EDL FAC 11/15/2021 5.875 253,297 167,574
500,000 PENNSYLVANIA ST HIGHER EDL FAC 7/1/2039 3.251 500,000 155,000
240,000 PHILADELPHIA PA HOSPS + HIGHER 1/1/2018 5.300 241,483 224,563
195,000 PHOENIX AZ STR + HWY USER REV 7/1/2011 6.250 198,154 195,675
250,000 PIMA CNTYARIZ INDL DEV AUTH E 7/1/2024 6.100 245,703 185,083
375,000 PIMA CNTYAZ INDL 2/1/2015 6.625 375,000 340,856
200,000 PIMA CNTYAZ INDL DEV 12/15/2016 5.250 198,069 170,656
160,000 PIMA CNTYAZ INDL DEV AUTH 8/1/2012 6.250 160,000 153,827
150,000 PIMA CNTYAZ INDL DEV AUTH 7/1/2023 5.700 154,376 109,908
420,000 PIMA CNTYAZ INDL DEV AUTH 6/1/2016 6.000 420,000 368,626
1,200,000 PIMA CNTYAZ INDL DEV AUTH 12/1/2017 5.350 1,066,566 968,520
475,000 PIMA CNTYAZ INDL DEV AUTH 7/1/2014 4.650 473,851 412,856
250,000 PIMA CNTYAZ INDL DEV AUTH 6/1/2022 5.000 254,275 178,280
230,000 PIMA CNTYAZ INDL DEV AUTH 7/1/2015 5.125 229,043 198,773
500,000 PIMA CNTYAZ INDL DEV AUTH 12/1/2018 6.375 500,000 424,820
725,000 PIMA CNTYAZ INDL DEV AUTH ED 2/1/2015 7.250 725,000 671,568
150,000 PIMA CNTYAZ INDL DEV AUTH ED 7/1/2012 5.000 149,757 139,490
500,000 PIMA CNTYAZ INDL DEV AUTH ED 7/1/2022 5.375 505,658 369,595
500,000 PINAL CNTY AZ INDL DEV AUTH 10/1/2020 5.250 524,547 398,230
402,000 PINGREE GROVE VILLAGE IL 3/1/2015 5.250 399,248 325,600
225,000 PITT CNTYNC REV 12/1/2010 5.375 230,658 236,360
1,000,000 PITTSBURGCA REDEV TAX ALLOC 9/1/2028 6.500 976,051 950,480
250,000 PLAINFIELD IN CMNTY HIGH SCH 7/15/2023 5.000 247,192 242,213
500,000 PLEASANT VALLEY CA SCH DIST 2/1/2022 5.850 498,018 515,205
750,000 PLEASANTSCNTY WV POLL CTL 5/1/2015 6.150 786,062 750,255
750,000 PORT CORPUS CHRISTI AUTH TX NE 12/1/2022 5.650 750,000 523,688
1,750,000 PORT EVERGLADES AUTH FL IMPT 9/1/2016 5.000 1,757,376 1,746,903
600,000 PORTLAND ME HSG DEV CORP 8/1/2015 4.875 600,000 500,946
250,000 PORTLAND ME HSG DEV CORP 8/1/2021 5.700 250,000 189,285
710,000 POTTER CNTY PA HOSP AUTH REV 8/1/2016 5.950 714,745 682,963
500,000 POTTER CNTY PA HOSP AUTH REV 8/1/2024 6.050 518,978 451,125
105,000 PRIVATE COLLEGES + UNIVS AUTH 10/1/2029 5.375 105,202 73,754
250,000 PROVIDENCE R I HSG AUTH HSG 9/1/2026 5.000 255,877 238,960
500,000 PROVIDENCE RI HSG AUTH HSG REV 9/1/2027 5.000 509,365 473,810
250,000 PROVO UT CHARTER SCH REV 6/15/2037 5.500 250,000 149,128
450,000 PUERTO RICO COMWLTH HWY 7/1/2045 3.131 450,000 162,000
500,000 PUERTO RICO ELEC 7/1/2025 3.281 500,000 235,000
500,000 PUERTO RICO SALES TAX FING 8/1/2057 3.069 500,000 252,500
750,000 QUAIL CREEK CMNTY FACS DIST 7/15/2016 5.150 750,000 601,095
750,000 QUINAULT INDIAN NATION WA 12/1/2015 5.800 747,621 526,905
400,000 RENO NV HOSP REV 6/1/2032 5.250 413,996 286,832
500,000 RENO NV HOSP REV 6/1/2020 5.500 509,172 451,285
750,000 RENO SPARKS INDIAN COLONY NV 6/1/2021 5.000 767,050 658,890
500,000 RHODE ISLAND HSG + MTG FIN CRP 10/1/2038 5.625 500,000 454,215
250,000 RHODE ISLAND ST HLTH + ED BLDG 5/15/2026 5.250 255,734 221,653
500,000 RICHARDSON TX HOSP AUTH REV 12/1/2028 5.625 515,640 344,410
500,000 RIVERSIDEMO INDL DEV AUTH 5/1/2020 5.000 502,899 461,400
550,000 RIVERSIDEMO INDL DEV AUTH 5/1/2027 4.500 519,881 446,050
See accompanying notes to financial statements. 42 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Percent
Maturity Coupon Fair of
Par/Shares Security date rate Cost Value (a) net assets
- ----------- --------------------------------------------- ---------- -------- -------------- ------------- ----------
250,000 RIVERWOOD ESTATES CMNTY DEV (b) 5/1/2013 5.000 250,000 110,000
1,250,000 ROCKPORT IN POLLUTION CTL REV 6/1/2025 4.625 1,226,425 995,613
500,000 ROSS CNTYOH HOSP REV 12/1/2028 5.750 502,950 421,795
1,000,000 SACRAMENTO CA CITY FING AUTH (c) 12/1/2021 5.200 515,916 394,610
500,000 SACRAMENTO CNTY CA CTFS PARTN 10/1/2027 4.750 500,402 383,690
250,000 SACRAMENTO CNTY CA SANTN DIST 12/1/2035 2.006 250,000 100,000
350,000 SACRAMENTO CNTY CA WTR FINGAU 6/1/2039 2.453 350,000 161,000
1,500,000 SADDLEBACK VY UNI SCH DIST CA 9/1/2017 5.650 1,500,000 1,504,155
250,000 SAGINAW MI HOSP FIN AUTH REV 7/1/2030 6.500 266,502 224,858
1,750,000 SAN BERNARDINO CNTY CA CTFS 8/1/2028 5.000 1,797,812 1,345,208
200,000 SAN DIEGOCA PUB FACS FING 5/15/2025 5.000 202,163 189,698
145,000 SAN DIEGOCA PUB FACS FING 5/15/2025 5.000 145,401 134,570
3,500,000 SAN DIEGOCA PUB FACS FING 5/15/2027 5.250 3,525,565 3,272,710
250,000 SAN JOAQUIN HILLS CA TRNS TOLL 1/15/2030 5.250 253,863 155,198
250,000 SANTA CLARA CA REDEV TAX ALLOC 6/1/2015 5.000 252,018 249,393
500,000 SARASOTA CNTY FL HEALTH FACS 1/1/2027 5.500 508,504 299,505
250,000 SARASOTA NATL CMNTY DEV DIS FL 5/1/2039 5.300 248,168 125,508
1,000,000 SCAGO EDL 12/1/2021 5.000 1,046,499 816,560
1,000,000 SCAGO EDLFACS CORP 12/1/2026 5.000 1,046,499 951,090
500,000 SCOTTSDALE AZ INDL DEV HOSP 9/1/2030 5.250 483,015 377,990
200,000 SEMINOLE TRIBE FL SPL OBLIG 10/1/2022 5.750 206,939 130,686
500,000 SEMINOLE TRIBE FL SPL OBLIG RE 10/1/2024 5.500 506,225 297,600
250,000 SENECA NATION INDIANS CAP 12/1/2023 5.000 248,688 141,890
625,000 SHELBY CNTY TN HLTH EDL + HSG (b) 1/1/2029 5.550 556,863 93,744
150,000 SHELBY CNTY TN HLTH EDL + HSG (b) 1/1/2019 5.350 134,966 22,619
500,000 SHELBY CNTY TN HLTH EDL + HSG 9/1/2011 4.900 500,000 474,335
750,000 SHELBY CNTY TN HLTH EDL + HSG 9/1/2016 5.250 745,309 600,450
500,000 SHELBY CNTY TN HLTH EDL + HSG 9/1/2026 5.625 496,382 327,985
1,000,000 SKOWHEGANME POLLUTN 11/1/2013 5.900 1,000,000 1,003,250
550,000 SNOHOMISHCNTY 4/1/2026 6.400 550,000 550,110
500,000 SOUTH CAROLINA EDL FACS AUTH 3/1/2020 5.000 478,918 375,475
500,000 SOUTH CAROLINA JOBS ECON DEV 4/1/2024 5.000 512,552 349,745
750,000 SOUTH CAROLINA JOBS ECONOMIC 5/1/2011 5.000 750,000 717,915
500,000 SOUTH CAROLINA JOBS ECONOMIC 11/15/2027 6.000 504,242 329,950
750,000 SOUTH CAROLINA JOBS ECONOMIC 11/15/2042 5.150 750,000 665,423
695,000 SOUTH CAROLINA JOBS ECONOMIC 11/1/2010 4.650 695,000 667,395
250,000 SOUTH CAROLINA ST HSG FIN +DEV 7/1/2032 5.500 250,000 228,208
1,000,000 SOUTH COAST CONSERVANCY DIST 1/1/2028 5.250 993,982 1,012,700
250,000 SOUTH DAKOTA ST HEALTH + EDL 11/1/2034 5.250 259,558 217,705
250,000 SOUTH DAKOTA ST HLTH EDL FACS 7/1/2035 5.500 252,757 171,388
400,000 SOUTH INDIAN RIV WTR CTL 8/1/2031 4.125 371,028 348,196
170,000 SOUTH LAKE CNTY HOSP DIST FL 10/1/2022 6.000 173,807 142,739
640,000 SOUTH LAKE CNTY HOSP FL 10/1/2013 5.500 640,013 659,053
300,000 SOUTHERN MN MUN PWR AGY SUPPLY 1/1/2013 4.086 300,000 285,639
250,000 SOUTHWESTERN IL DEV AUTH REV 8/15/2015 5.375 257,477 222,080
1,500,000 SOUTHWESTERN IL DEV AUTH REV 8/15/2029 5.625 1,539,909 1,025,205
250,000 SOUTHWESTERN IL DEV AUTH REV 11/1/2026 5.625 248,241 173,403
750,000 SOUTHWESTERN IL DEV AUTH REV 10/1/2022 7.000 750,000 562,148
500,000 SPARKS NVREDEV AGY TAX 6/1/2020 6.400 492,014 381,355
500,000 SPARKS NVTOURISM IMPT DIST 6/15/2020 6.500 482,404 384,875
317,000 ST BERNARD PARISH LA HOME MTG 3/1/2039 5.800 310,674 310,210
1,025,000 ST JOHN BAPTIST PARISH LA REV 6/1/2037 5.125 1,025,000 609,844
240,000 ST JOHNS CNTY FL INDL DEV 10/1/2017 5.000 240,000 177,622
500,000 ST JOHNS CNTY FL INDL DEV AUTH 8/1/2034 5.625 481,919 329,145
500,000 ST JOSEPHCNTY IN ECONOMIC DE 5/15/2038 6.000 365,672 292,120
400,000 ST JOSEPHCNTY IND ECONOMIC 5/15/2014 5.750 408,291 352,032
1,000,000 ST JOSEPHMO INDL DEV AUTH TAX 11/1/2019 5.100 987,668 775,360
500,000 ST JOSEPHMO INDL DEV AUTH TAX 11/1/2023 5.375 496,176 361,385
500,000 ST JOSHEPCNTY IN HOSP AUTH 2/15/2028 5.250 510,451 342,515
800,000 ST LOUIS CNTY MO HSG AUTH (b) 11/1/2014 8.500 800,000 469,376
250,000 ST LOUIS CNTY MO INDL DEV 9/1/2021 5.375 254,923 199,585
250,000 ST LOUIS CNTY MO INDL DEV AUTH 11/15/2022 5.000 253,562 145,190
1,000,000 ST LOUIS CNTY MO INDL DEV AUTH 12/1/2027 5.370 1,000,000 968,400
450,000 ST LOUIS MO INDL DEV AUTH TAX 5/1/2026 5.125 447,379 274,199
525,000 ST PAUL MN HSG + REDEV HOSP 11/15/2014 5.250 535,585 426,851
242,033 ST TAMMANY PARISH LA FIN AUTH 12/1/2039 5.250 247,735 221,424
175,000 STERLING HILL CMNTY DEV DIST 11/1/2010 5.500 174,700 168,011
300,000 STERLING HILL CMNTY DEV DIST 5/1/2011 5.100 300,000 180,258
See accompanying notes to financial statements. 43 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Percent
Maturity Coupon Fair of
Par/Shares Security date rate Cost Value (a) net assets
- ----------- --------------------------------------------- ---------- -------- -------------- ------------- ----------
500,000 STONEYBROOK SOUTH CMNTY DEV FL 11/1/2015 5.450 498,402 312,525
500,000 SULLIVAN CNTY TN HEALTH EDL 9/1/2036 5.250 516,465 290,140
395,000 SUMMIT ACADEMY NORTH MI PUB 11/1/2011 4.750 395,093 373,781
1,250,000 SYMRNA TENN HSG INC 10/20/2035 6.450 1,256,016 1,271,475
500,000 TANGIPAH0A PARISH LA HOSP SVC 2/1/2015 5.375 520,056 458,045
500,000 TARRANT CNTY TEX CULTURAL ED 11/15/2016 5.250 484,314 389,125
750,000 TARRANT CNTY TX CLUTURAL ED 11/15/2036 6.000 772,795 430,440
1,000,000 TARRANT CNTY TX CULTURAL ED 11/15/2026 6.000 1,036,610 645,590
250,000 TARRANT CNTY TX CULTURAL ED 2/15/2013 5.000 249,720 226,478
500,000 TENNESSEEHSG DEV AGY 7/1/2034 5.100 500,000 426,590
500,000 TENNESSEEHSG DEV AGY 7/1/2031 4.500 500,000 496,365
1,000,000 TENNESSEEHSG DEV AGY 7/1/2038 5.450 1,000,000 885,510
240,000 TENNESSEEHSG DEV AGY MTG FIN 7/1/2023 5.200 242,495 226,459
795,000 TERREBONNE PARISH LA 3/1/2024 5.875 802,486 838,502
250,000 TEXAS MUNGAS ACQUISITION 12/15/2026 2.787 250,000 147,500
185,000 TEXAS MUNGAS ACQUISITION CORP 12/15/2026 6.250 177,298 148,736
1,000,000 TEXAS ST PUB FIN AUTH 8/15/2030 5.000 870,933 535,730
500,000 TEXAS ST PUB FIN AUTH CHARTER 9/1/2018 5.500 500,000 401,480
800,000 TEXAS STUDENT HSG AUTH REV (b) 1/1/2014 11.000 800,000 8
1,305,000 TISONS LANDING CMNTY DEV DIST (b) 11/1/2011 5.000 1,304,122 456,750
300,000 TOBACCO SETTLEMENT FING CO NJ 6/1/2015 5.000 308,760 269,031
95,000 TOBACCO SETTLEMENT FING CORP 6/1/2011 5.000 95,000 95,028
425,000 TODD CREEK FARMS MET DIST NO 1 12/1/2009 4.750 424,059 411,107
250,000 TOLEDO LUCAS CNTY OH PORT AUTH 12/1/2035 5.375 257,815 171,353
750,000 TOLOMATO CMNTY DEV DIST FL 5/1/2017 6.375 750,000 574,748
2,000,000 TRAVIS CNTY TX HEALTH FACS DEV 11/15/2035 4.750 2,000,000 1,899,920
840,000 TRAVIS CNTY TX HSG FIN CORP (b) 6/1/2035 9.250 840,000 323,266
520,000 TYLER TX HEALTH FACS DEV CORP 7/1/2009 6.600 520,000 525,876
350,000 TYLER TX HEALTH FACS DEV CORP 11/1/2037 5.375 347,589 214,963
500,000 ULSTER CNTY N Y INDL 9/15/2013 5.100 496,887 434,995
500,000 ULSTER CNTY N Y INDL 9/15/2016 5.250 493,751 389,565
135,000 UNIVERSITY AZ MED CTR HOSP REV 7/1/2013 5.000 135,556 132,053
240,000 UNIVERSITY CITY MO INDL DEV AU 12/20/2030 6.000 250,917 235,970
671,000 UTAH ASSOCIATED MUNI POWER SYS 5/1/2022 4.750 671,000 481,208
500,000 UTAH HSG CORP SINGLE FAMILY 1/1/2040 5.550 500,000 447,315
600,000 UTAH ST CHARTER SCH FIN AUTH 7/15/2018 6.375 600,000 505,290
575,000 VALLEY ALSPL CARE FACS FING 11/1/2011 5.450 583,136 549,602
1,115,000 VERANO CTR CMNTY DEV DIST FL 11/1/2012 5.000 1,115,000 618,758
1,000,000 VERMONT EDL + HLTH BLDGS AGY 12/1/2027 6.125 1,021,317 832,670
260,000 VERRADO CMNTY FACS DIST NO 1 7/15/2013 6.000 260,000 251,836
300,000 VIGO CNTYIN HOSP AUTH REV 9/1/2027 5.500 296,872 190,299
500,000 VIRGINIA ST HSG DEV AUTH 7/1/2031 5.350 504,615 465,400
2,000,000 VIRGINIA ST HSG DEV AUTH 7/1/2036 5.375 2,092,972 1,825,160
750,000 VIRGINIA ST HSG DEV AUTH 7/1/2025 6.000 750,000 759,203
250,000 WALKER FIELD CO PUB ARPT AUTH 12/1/2027 4.750 227,807 160,570
350,000 WASHINGTON CNTY IA HOSP REV 7/1/2017 5.250 349,752 283,231
145,000 WASHINGTON CNTY PA AUTH REV 12/1/2029 6.150 153,652 115,487
485,000 WASHINGTON ST HEALTH CARE FACS 2/15/2027 5.000 396,484 369,619
500,000 WASHINGTON ST HEALTH CARE FACS 8/1/2028 6.250 518,194 506,255
1,000,000 WASHINGTON ST HSG FIN COMM 12/1/2033 5.450 1,000,000 900,720
1,150,000 WASHINGTON ST HSG FIN COMMN 1/1/2017 5.250 1,146,208 900,542
650,000 WASHINGTON ST HSG FIN COMMN 1/1/2013 5.100 650,000 585,371
485,000 WATERS EDGE CMNTY DEV DIST 11/1/2012 5.000 485,147 316,002
500,000 WATERSET NORTH CMNTY DEV DIST 11/1/2015 6.550 498,613 302,325
750,000 WEATHERFORD HOSP AUTH OK REV 5/1/2016 6.000 765,819 613,298
125,000 WELD CNTYCO CTFS PARTN 12/15/2019 5.125 127,544 102,754
500,000 WEST VIRGINIA ST HOSP FIN AUTH 6/1/2028 5.375 487,896 394,575
965,000 WEST VIRGINIA ST HSG DEV FD 11/1/2032 5.350 943,355 958,621
245,000 WEST VLGSIMPT DIST FLA REV 5/1/2037 5.500 245,000 131,531
845,000 WESTERN GENERATION AGY OR 1/1/2021 5.000 853,383 565,947
200,000 WESTPARK CMNTY FACS DIST AZ 7/15/2016 4.900 200,000 156,364
500,000 WHITEHOUSE TX INDPT SCH DIST (c) 2/15/2025 4.650 238,349 196,240
500,000 WI ST HEALTH EDL FACS 6/1/2028 5.700 519,615 369,900
255,000 WILL CNTYIL SPL ED JT 1/1/2021 5.500 265,078 241,801
750,000 WINNEBAGO+ STEPHENSONCNTYS (c) 1/1/2019 5.250 446,484 425,468
460,000 WISCONSINHEALTH + EDL FACS 8/15/2016 4.600 458,812 414,575
1,000,000 WISCONSINHEALTH + EDL FACS 12/1/2034 4.750 1,000,000 979,190
250,000 WISCONSINST HEALTH + EDL 11/15/2032 6.000 268,600 218,955
500,000 WISCONSINST HEALTH + EDL 8/15/2024 6.500 343,598 341,180
See accompanying notes to financial statements. 44 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Percent
Maturity Coupon Fair of
Par/Shares Security date rate Cost Value (a) net assets
- ----------- --------------------------------------------- ---------- -------- -------------- ------------- ----------
450,000 WISCONSINST HEALTH + EDL FACS 7/1/2017 6.000 462,042 452,016
350,000 WISCONSINST HEALTH + EDL FACS 7/1/2021 6.000 359,361 334,173
250,000 WISCONSINST HEALTH + EDL FACS 10/1/2013 4.500 248,938 231,508
500,000 WISCONSINST HEALTH + EDL FACS 2/15/2032 5.250 488,188 363,725
500,000 WISCONSINST HEALTH + EDL FACS 1/15/2025 5.650 510,373 484,370
215,000 WISCONSINST HEALTH + EDL FACS 11/15/2023 6.000 229,153 204,143
1,000,000 WISCONSINST HEALTH + EDL FACS 5/15/2029 5.125 851,461 648,720
500,000 WISCONSINST HEALTH + EDL FACS 7/1/2026 5.000 505,329 364,325
500,000 WISCONSINST HEALTH + EDL FACS 8/15/2034 6.750 507,449 317,855
225,000 WISCONSINST HEALTH + EDL FACS 3/1/2015 4.650 225,000 192,938
400,000 WISCONSINST HEALTH + EDL FACS 9/1/2015 5.000 400,000 329,004
305,000 WISCONSINST HEALTH + EDL FACS 2/15/2034 5.375 307,499 207,970
400,000 WISCONSINST HEALTH EDL FACS 8/15/2023 5.600 401,482 337,776
500,000 WISCONSINST HLTH + EDL FACS 8/15/2026 5.875 475,385 433,495
1,880,000 WISCONSINST HLTH + EDL FACS 8/15/2013 6.125 1,881,819 1,881,109
1,000,000 WISCONSINST HLTH + EDL FACS 8/15/2022 5.750 895,351 718,740
1,000,000 WISCONSINST HLTH + EDL FACS 8/15/2023 5.500 1,001,503 858,660
940,000 WOODHILL PUB FAC CORP TEX 12/1/2015 7.250 929,900 872,922
250,000 WYOMING MUN PWR AGY PWR 1/1/2028 5.500 255,319 227,895
250,000 YORK CNTYPA INDL DEV AUTH REV 10/1/2019 6.450 250,000 250,673
250,000 YUBA CTY CL REDEV AGY TAX ALLO 9/1/2027 5.125 254,799 164,718
355,000 ZEPHYR RIDGE CMNTY DEV DIST FL 5/1/2013 5.250 355,603 196,947
-------------- -------------
411,365,083 343,700,984 92.68%
Cash equivalents:
2,325,738 SSGA TAX-EXEMPT MONEY MARKET FUND, current rate 1.18% $ 2,325,738 2,325,738 0.63%
-------------- ------------- ----------
Grand total (d) $ 444,539,532 368,520,387 99.37%
============== ============= ==========
Notes to schedule of investments:
(a) Securities are valued in accordance with procedures described in
note 2 to the financial statements.
(b) Currently non-income producing assets. For long-term debt
securities, item identified is in default as to payment of interest
and/or principal.
(c) For zero coupon bonds, the interest rate disclosed represents the
annualized effective yield on the date of acquisition.
(d) At December 31, 2008, the cost for Federal income tax purposes was
$444,539,532. The aggregate gross unrealized appreciation and
depreciation of investments in securities based on this cost were as
follows:
Gross unrealized appreciation $ 801,795
Gross unrealized depreciation (76,820,940)
--------------
Net unrealized depreciation $ (76,019,145)
==============
(e) This security is deemed worthless by the management of the Fund as
of December 31, 2008
Distribution of investments representing geographic diversification, as a
percentage of total investments at value, is as follows:
Geographical Diversification Percent
------------------------------------------------------------------
Texas 9.03%
Illinois 6.97
Florida 6.66
California 6.37
Indiana 3.63
Louisiana 3.44
Missouri 2.90
South Carolina 2.60
Michigan 2.53
Colorado 2.48
Pennsylvania 2.46
Other 50.93
--------
100.00%
========
See accompanying notes to financial statements. 45 (Continued)
CLEARWATER INVESTMENT TRUST
Schedule of Investments - Clearwater Tax-Exempt Bond Fund
December 31, 2008
Clearwater Tax-Exempt Bond Fund Portfolio Diversification
(as a percentage of net assets)
[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
Public Housing Bonds 2%
Insured bonds 12%
General Obligation Bonds 2%
Multi-Family Housing Bonds 18%
Education Bonds 10%
Insured General Obligation Bonds 1%
Hospital Bonds 21%
Public Utility Bonds 3%
Industrial Revenue Bonds 3%
Cash 1%
Other 27%
See accompanying notes to financial statements.
46
CLEARWATER INVESTMENT TRUST
---------------------------
FORM N-CSR
Item 2 Code of Ethics (annual report only)
- ------------------------------------------
a) As of the end of the period covered by this report, the Trustees of
the Clearwater Investment Trust have adopted a code of ethics that
applies to the Trust's principal executive officer, principal
financial officer, principal accounting officer or controller, or
persons performing similar functions, regardless of whether these
individuals are employed by the trust or a third party.
b) For purposes of this Item, the term "code of ethics" means written
standards that are reasonably designed to deter wrongdoing and to
promote:
1. Honest and ethical conduct, including the ethical
handling of actual or apparent conflicts of interest
between personal and professional relationships;
2. Full, fair, accurate, timely, and understandable
disclosure in reports and documents that a registrant
files with, or submits to, the Commission and in other
public communications made by the registrant;
3. Compliance with applicable governmental laws, rules, and
regulations;
4. The prompt internal reporting of violations of the code
to an appropriate person or persons identified in the
code' and
5. Accountability for adherence to the code.
c) During the period covered by this report no amendment has been made
to the Trust's code of ethics referred to in (a) above.
d) During the period covered by this report, the Trustees have granted
no waivers, including implicit waivers, from any provisions of the
Trust's code of ethics referred to in (a) above.
e) Not applicable.
f) See Item 12(a).
Item 3 Audit Committee Financial Expert (annual report only)
- ------------------------------------------------------------
The Board of Trustees of the Clearwater Investment Trust consists of five
members, four of whom are Independent Trustees as defined by the Investment
Company Act of 1940. The Board of Trustees does not include an "audit committee
financial expert" as defined by Section 407 of the Sarbanes-Oxley Act of 2002
and the rules promulgated thereunder. Given the restrictive nature of the
definition of an "audit committee financial expert", the Trustees have
determined that the Trust's investor constituency is highly unlikely to include
anyone meeting that definition. Furthermore, the Trustees have determined that
given the nature of investment company financial statements in general and the
investment policies of the Trust's fund offerings in particular that the
independent trustees possess the necessary skills and experience to perform the
functions of the audit committee.
Item 4 Principal Accountant Fees and Services (annual report only) (accrual
- ---------------------------------------------------------------------------
basis)
- ------
a) Audit Fees 2008 = $79,000 2007 = $75,650
b) Audit-Related Fees 2008 = None 2007 = None
c) Tax Fees 2008 = None 2007 = None
d) All Other Fees 2008 = None 2007 = None
e)
1. The Independent Trustees have not adopted pre-approval
policies and procedures regarding the provision of audit or
non-audit services to the trust, as described in paragraph
(c)(7) of Rule 2-01 of Regulation S-X, as they require that
all such proposed services be approved by them in advance.
2. No services were pre-approved by the Independent Trustees
pursuant to paragraph (c)(7) of Rule 2-01 of Regulation S-X.
f) Not applicable.
g) Non-Audit Related Fees Provided to the Trust or to the Trust's
Investment Adviser 2008 = $4,500 2007 = $4,325
h) The Trust's Principal Accountant provides the examination required
by Rule 206(4)-2(a)(3)(ii) regarding the custody and safekeeping of
client funds and securities. These fees were pre-approved by the
Trust's audit committee.
Item 5 Audit Committee of Listed Registrants (annual report only)
- -----------------------------------------------------------------
Not applicable.
Item 6 Schedule of Investments (annual and semi-annual report)
- --------------------------------------------------------------
See Item 1.
Item 7 Disclosure of Proxy Voting Policies and Procedures for Closed-End
- ------------------------------------------------------------------------
Management Investment Companies
- -------------------------------
Not applicable (the Trust is an open-end Management Investment
Company)
Item 8 Portfolio Managers of Closed-End Management Investment Companies
- -----------------------------------------------------------------------
Not applicable (the Trust is an open-end Management Investment
Company)
Item 9 Purchases of Equity Securities by Closed-End Management Investment
- -------------------------------------------------------------------------
Company and Affiliated Purchasers.
- ----------------------------------
Not applicable (the Trust is an open-end Management Investment
Company)
Item 10 Submission of Matters to a Vote of Security Holders
- -----------------------------------------------------------
There have been no material changes to the procedures by which
shareholders may recommend nominees to the Board of Trustees.
Item 11 Controls and Procedures
- -------------------------------
a) The Trust's principal executive officer and principal financial
officer have concluded that the Trust's disclosure controls and
procedures (as defined in Rule 30a-3(c) under the Investment company
Act of 1940, as amended) are effective based on their evaluation of
these controls and procedures as of a date within 90 days of the
filing date of this document.
b) There have been no significant changes in the Trust's internal
controls over financial reporting since the filing of the last
report that have materially affected, or are reasonably likely to
materially affect, the Trust's internal control over financial
reporting.
Item 12 Exhibits
- ----------------
a) The Clearwater Investment Trust Code of Ethics for the President,
Treasurer and Principal Accounting Officer is attached.
b) The certifications for each principal executive and principal
financial officer of the Trust as required by Rule 30a-2(a) of the
Investment Company Act of 1940 are attached.
c) No written solicitations to purchase securities were sent or
delivered during the period covered by this report by or on behalf
of the Trust.
Signatures
----------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Registrant: Clearwater Investment Trust
---------------------------
/s/George H. Weyerhaeuser, Jr.
------------------------------
George H. Weyerhaeuser, Jr.
Chairman
Date: March 6, 2009
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1040, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
/s/George H. Weyerhaeuser, Jr.
------------------------------
George H. Weyerhaeuser, Jr.
Chairman
Date: March 6, 2009
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1040, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
/s/George H. Weyerhaeuser, Jr.
------------------------------
George H. Weyerhaeuser, Jr.
Treasurer
Date: March 6, 2009