Investment Outlook for 2010 Charles Carlson, CFA

Chief Executive Officer

Richard Moroney, CFAChief Investment Officer

1-800-711-7969

Charles Carlson, CFA

• Editor, DRIP Investor, since 1982• Contributing Editor to Dow Theory Forecasts• Chief Executive Officer, Horizon Investment

Services and Horizon Publishing Company• Author of nine books, including the bestselling

Buying Stocks Without A Broker and The Smart Investor’s Survival Guide

Horizon Publishing Company, publisher of the Dow Theory Forecasts, Upside, and DRIP Investor, is the sister company of Horizon Investment Services.

2009 Review – What Happened & Why

• The world didn’t end• Corporate profits beat expectations• “ABC” market

Richard Moroney, CFA

• Editor, Dow Theory Forecasts, since 1994 • Editor, Upside, since 1999 • Chief Investment Officer and Portfolio

Manager, Horizon Investment Services • Developer of the Quadrix stock-rating system

used by Dow Theory Forecasts, Upside, and Horizon Investment Services Horizon Publishing Company, publisher of the Dow Theory Forecasts, Upside, and DRIP Investor, is the sister company of Horizon Investment Services.

Performance vs. PeersAnnualized statistics from August 2003 – September 2009

Return %Standard

Deviation % Sharpe Ratio

Best Ideas Strategy 7.4 14.3 0.34

S&P 500 / Citigroup Pure Growth 5.5 17.1 0.17

S&P 500 / Citigroup Pure Value 7.8 26.3 0.20

S&P Midcap 400 / Citi Pure Growth 9.5 19.4 0.36

S&P Midcap 400 / Citi Pure Value 8.0 26.0 0.21

Russell 2000 Growth 4.7 20.6 0.10

Russell 2000 Value 5.7 20.1 0.16

Russell 2500 Growth 5.4 19.7 0.14

Russell 2500 Value 6.3 19.1 0.19

S&P 500 3.1 14.8 0.04

Standard deviation of return measures the average deviations of a return series from its mean, and is often used as a measure of risk. A large standard deviation implies that there have been large swings in the return series of the manager. The Sharpe Ratio of a manager series is the quotient of the annualized excess return of the manager over the cash equivalent and the annualized standard deviation of the manager return. The Sharpe Ratio is a risk-adjusted measure of return which uses standard deviation to represent risk. See disclosures at the end of this presentation for additional information. Source: Zephyr StyleADVISOR

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DisclosuresPerformance through 11/30/09. Past performance is no guarantee of future results.

Horizon Investment Services LLC, is registered with the SEC as an investment adviser. The firm manages equity, mutual fund, income, and balanced portfolios for U.S. investors. The composite performance results include all fully discretionary accounts for the strategies shown above managed by Horizon Investment Services and exclude any accounts with significant client-imposed investment restrictions. Accounts are added to the composite after their first full calendar month of investment performance. Accounts that have significant cash flows that total over 30% of assets are temporarily removed from the composite. Composite performance results are presented after brokerage commissions, reinvested income and advisory fees and are asset-weighted, time-weighted total return figures. Performance was reduced by the highest fee charged to any client employing these strategies for the periods under consideration. Actual fees may vary depending on fee schedule and portfolio size. Advisory fee schedules are available upon request or may be found in Part II of Horizon Investment Services’ Form ADV.

The Quadrix® stock-rating system is a product wholly-owned by Horizon Publishing Company, Horizon Investment Services' sister company. Horizon Investment Services has contracted with Horizon Publishing Company to use the Quadrix stock-rating system for its stock-screening processes.

As of November 30, 2009, the Best Ideas Strategy composite included 82 accounts with $27.9 million in combined assets. In addition to large and mid-capitalization stocks, the Best Ideas Strategy contains small-capitalization stocks, which tend to be more volatile. The inception date of the composite was July 31, 2003. The comparative market index for the Best Ideas Strategy is a 50/50 blended performance of the Russell 1000 and Russell 2000 indexes, calculated by averaging the cumulative total returns of the two indexes for the periods presented. In our opinion, this blended index represents a fair approximation of the composition of the Best Ideas Strategy. The Russell 2000 index is an unmanaged index that measures the performance of the smallest 2,000 companies in the Russell 3000 Index of the 3,000 largest U.S. companies in terms of market capitalization. The Russell 1000 index is an unmanaged index that measures the performance of the largest 1,000 companies in the Russell 3000 index of the 3,000 largest U.S. companies in terms of market capitalization. The S&P 500 index is presented solely because it is a widely followed index. The S&P 500 index is an unmanaged index that measures the performance of 500 large company stocks weighted by market capitalization.

Disclosures cont.The S&P 500 / Citigroup Pure Growth Index is weighted by style score. Only stocks that exhibit strong growth or value

characteristics are included. Constituents included all have a Growth or Value factor of 100% and a Growth or Value score greater than 0.25.

The S&P 500/Citigroup Pure Value Index is weighted by style score. Only stocks that exhibit strong growth or value characteristics are included. Constituents included all have a Growth or Value factor of 100% and a Growth or Value score greater than 0.25.

The S&P Midcap 400/Citigroup Pure Growth Index is weighted by style score. Only stocks that exhibit strong growth or value characteristics are included. Constituents included all have a Growth or Value factor of 100% and a Growth or Value score greater than 0.25. The

S&P Midcap 400/Citigroup Pure Value Index is weighted by style score. Only stocks that exhibit strong growth or value characteristics are included. Constituents included all have a Growth or Value factor of 100% and a Growth or Value score greater than 0.25.

The Russell 2000 Growth Index is a subset of the Russell 3000 Index representing approximately 10% of the total market capitalization of that index and includes companies with higher price-to-book ratios and higher forecasted growth values. The Russell 2000 Growth Index is constructed to provide a comprehensive and unbiased barometer for the small-cap growth segment.

The Russell 2000 Value Index is a subset of the Russell 3000 Index representing approximately 10% of the total market capitalization of that index and includes companies with lower price-to-book ratios and lower forecasted growth values. The Russell 2000 Value Index is constructed to provide a comprehensive and unbiased barometer for the small-cap value segment.

Disclosures cont.The Russell 2500 Growth Index measures the performance of the small to mid-cap growth segment of the U.S. equity universe. It includes those Russell 2500 companies with higher price-to-book ratios and higher forecasted growth values. The Russell 2500 Growth Index is constructed to provide a comprehensive and unbiased barometer of the small to mid-cap growth market. The Index is completely reconstituted annually to ensure larger stocks do not distort the performance and characteristics of the true small to mid-cap opportunity set and that the represented companies continue to reflect growth characteristics.

The Russell 2500 Value Index measures the performance of the small to mid-cap value segment of the U.S. equity universe. It includes those Russell 2500 companies with lower price-to-book ratios and lower forecasted growth values. The Russell 2500 Value Index is constructed to provide a comprehensive and unbiased barometer of the small to mid-cap value market. The Index is completely reconstituted annually to ensure larger stocks do not distort the performance and characteristics of the true small to mid-cap opportunity set and that the represented companies continue to reflect value characteristics.

Standard & Poor’s 1500 index combines three leading indices, S&P 500, S&P MidCap 400, and the S&P SmallCap 600 indices to cover approximately 90% of the U.S. market capitalization as a benchmark for the U.S. equity market.

Zephyr's StyleADVISOR is a software program that uses returns-based style analysis to quickly ascertain a manager’s style and creates a unique style benchmark that reflects that style. Source: www.StyleADVISOR.com.