Annual Reports - Northwestern Mutual

Domestic Equity Portfolio
have been able to invest in what we believe to be industry-leading, high-quality companies such as United Parcel Service,
Lowe’s and United Technologies—companies whose stocks almost never meet our value criteria. So while it is impossible to
know when economic and market conditions will turn, we are using this opportunity to attempt to position the Portfolio for
outperformance by adding what we believe to be well-run, attractively valued companies at knock-down prices. As of
December 31, the largest sector overweight was Consumer Staples, while the most notable sector underweight was in Energy.
Relative Performance
$20,000
15,000
10,000
5,000
0
7/01 12/01 12/02 12/03 12/04 12/05 12/06 12/07 12/08
Top 10 Equity Holdings 12/31/08
Security Description
% of Net Assets
Kraft Foods, Inc. - Class A 4.3%
AT&T, Inc. 4.2%
JPMorgan Chase & Co. 3.4%
General Electric Co. 3.3%
Hudson City Bancorp, Inc. 3.3%
The Goldman Sachs Group, Inc. 3.3%
Nucor Corp. 3.2%
Wells Fargo & Co. 3.0%
United Technologies Corp. 2.7%
Sara Lee Corp. 2.5%
Domestic Equity Portfolio
Russell 1000 Value Index
Average Annual Total Returns
For Periods Ended December 31, 2008
1 Year 5 Years
Since
Inception*
Domestic Equity Portfolio
Russell 1000 Value Index
-38.49% -3.25%
-36.85% -0.79%
-1.74%
0.16%
Lipper Variable Insurance Products
(VIP) Large Cap Value Funds
Average -37.09% -2.10% –
*Inception date of 7/31/01
The performance data quoted represents past
performance. Past performance is historical and does
not guarantee future performance. Investment return
and principal value will fluctuate, so that shares, when
redeemed, may be worth more or less than their original
cost. Current performance may be lower or higher than
the performance data quoted. For the most recent
month-end performance information visit
www.nmfn.com.
This chart assumes an initial investment of $10,000
made on 7/31/01 (commencement of the Portfolio's
operations). Returns shown reflect fee waivers,
deductions for management and other portfolio
expenses, and reinvestment of all dividends. In the
absence of fee waivers, total return would be reduced.
Returns exclude deductions for separte account sale
loads and account fees. Please refer to the Benchmark
Definitions section of this report for information about
the indices cited in the above chart and graph.
Telecommunication Services
5%
Utilities
5%
Materials
7%
Short-Term
Investments &
Other Net Assets
8%
Consumer
Discretionary
9%
Health Care
9%
Sector Allocation 12/31/08
Information Technology
4%
Sector Allocation is based on Net Assets.
Sector Allocation and Top 10 Holdings are subject to
change.
Financials
15%
Consumer
Staples
15%
Industrials
12%
Energy
11%
28 Domestic Equity Portfolio