U.S. Stock Market Index Fund

Fund Objective

The U.S. Stock Market Index Fund seeks to match the returns and characteristics of the Russell 3000 Index.

Investment Strategy

The Russell 3000 Index is comprised of the 3000 largest stocks in the U.S. market and accounts for approximately 98 percent of the U.S. stock market capitalization. The U.S. Stock Market Index Fund employs an optimized replication approach to construct a fund that closely mirrors the returns of the index. Replication also results in lower turnover and transaction costs in addition to tight tracking. The fund is structured as an umbrella that owns units of the S&P 500 and the Russell 3000 minus the S&P 500 securities in their capitalization weighted positions. This structure captures the liquidity of the S&P 500 and maximizes the use of internal fund liquidity through security crosses and swaps.

To provide 100 percent exposure to the equity market and increase tracking accuracy, the fund may hold a combination of S&P 500, S&P MidCap, and Russell 2000 futures in lieu of cash.

Investment Risk

The U.S. Stock Market Index Fund is intended for members who want an investment designed to parallel the returns of the Russell 3000 Index. It is intended as a long-term investment vehicle due to the higher volatility of returns on common stocks over short-term periods.

Investment Manager

The U.S. Stock Market Index Fund is provided by Washington State Investment Board and managed by Barclay’s Global Investments.

Investment Restrictions

Once a member has transferred money out of the fund, he or she will not be allowed to transfer money back into the same fund for thirty calendar days. The thirty day window will be based on the last time the member made a transfer out of the fund. This restriction will not affect the member’s regular contribution or the ability to leave state service and withdraw from Plan 3. For additional information, please refer to page 2 of the Plan 3 Investment Guide.

* Historic performance is not necessarily indicative of actual future investment performance, which could differ substantially. All performance figures contained herein are provided net of management fees and other expenses but before the WSIB and record keeper expenses. All returns are calculated in U.S. dollars.

Please note: totals may not equal 100% due to rounding.

** Other expenses are as of March 31, 2009. Expenses include the operating costs associated with portfolio management and items such as custodial fees, audit fees and transfer agent fees. They are usually fixed costs and change in percentage as the fund balance changes.

Fees are calculated based upon your daily account balance.

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