The Selected Funds

Investment Strategy

As of 3/31/10:
Large Cap:	67%
Mid Cap:	22%
Small Cap:	11%

Selected Special Shares is team-managed by the same experienced group of investment professionals who conduct research for Selected American Shares. Members of the Selected Special Shares management team select ideas to produce a portfolio that is diversified both by sector and by company size.

The investment management team focuses on identifying small, medium and large size companies with the characteristics we believe foster the long-term creation of value in businesses.

The characteristics we look for include first-class management, management ownership, high returns on capital, low cost structure, dominant or growing market share, proven track record, strong balance sheet, products and services that do not become obsolete, successful international operations, and innovative users of technology.

Sixty Years of Investment Experience

Sixty years and three generations of experience investing in the stock market has taught us that uncertainty is the rule, not the exception.

In fact, during the past six decades, the Davis family has navigated many different market and economic environments, including 11 recessions, 13 bear markets, including the '73-'74 bear market and the Crash of 1987, the S&L crisis, the NASDAQ collapse, 9/11, interest rates ranging between 2.1%-15.8%, oil prices ranging between $10.25-$133.60 per barrel, inflation ranging between 0%-14.76% and three major military conflicts.

Despite these inevitable periods of uncertainty and crises, stocks have rewarded patient long-term investors. A manager with experience navigating decades of ever-changing market conditions may provide investors with the conviction necessary to adhere to their investment plan and benefit from the long-term compounding power of equities.

Fund Attributes

Our firm's consistent application of the patient, rigorous, research-intensive Davis investment discipline, combined with our strong belief in the principles of shareholder stewardship, has resulted in a number of unique attributes:

Substantial Co-investment
The Davis family, Davis Advisors, employees and directors have over $2 billion of their own money invested side by side with fellow shareholders in the various mutual funds our firm manages. This creates one of the greatest degrees of shareholder alignment in the industry. 1

In addition to the portfolio managers' significant co-investment in the Fund, the team's compensation is tied to long-term investment results. These facts help to ensure an appropriate alignment of interests with clients.
A Culture of Shareholder Stewardship
At Davis, we put our clients' goals first. Morningstar has recognized this commitment by awarding the Fund its highest overall Stewardship Grade of "A", a level achieved by less than 10% of the funds Morningstar grades. 1

Lower Than Average Expense Ratio 2
Selected Special Shares S: 1.25%, Lipper Category Average: 1.46%

Lower Than Average Turnover Rate 3
Selected Special Shares S: 24%, Lipper Category Average: 85%

The highly-patient nature of the Davis investment discipline is reflected in our lower than average turnover ratio.

Who Should Consider Selected Special Shares

Investors who understand opportunistic strategies that are not bound by market cap, sector or industry constraints may offer the potential for attractive long-term results. *

Investors who need a diversified equity solution that offers access to small, medium and large companies.**

Investors who already have an appreciation for Davis Advisors' signature investment approach, firm history and culture of stewardship.

* An investor must be willing to accept the increased volatility which accompanies the potential for attractive long-term results. See the endnotes for a description of small- and medium-capitalization and foreign country risk.

** Diversification does not ensure against loss.

1 As of December 31, 2009.
2 Fund expense ratio is as of most recent prospectus. Lipper Category Average is as of most recent quarter end.
3 Fund turnover is as of most recent audited financial statement. Lipper Category Average is as of most recent quarter end. Figures reported are net of reimbursements and may vary in future periods. Peer/category data is compiled using Lipper. As of March 31, 2010, Selected Special Shares had been categorized by Lipper as Multi-Cap Core.

This material must be accompanied or preceded by a current Selected Funds Prospectus. Carefully consider the fund's investment objectives, risks, fees and expenses before investing or sending money. The prospectus contains this and other information and can be obtained by clicking here or calling 1 (800) 243-1575. Read the prospectus carefully before you invest or send money.

Selected Special Shares investment objective is capital growth. There can be no assurance that the Fund will achieve its objective. Some important risks of an investment in the Fund are: market risk: the market value of shares of common stock can change rapidly and unpredictably; company risk: the market value of a common stock varies with the success or failure of the company issuing the stock; small- and medium-capitalization risk: small and mid-size companies typically have more limited product lines, markets and financial resources than larger companies, and their securities may trade less frequently and in more limited volume than those of larger, more mature companies; and foreign country risk: companies operating, incorporated, or principally traded in foreign countries may have more fluctuation as foreign economies may not be as strong or diversified, foreign political systems may not be as stable, and foreign financial reporting standards may not be as rigorous as they are in the United States. As of March 31, 2010, Selected Special Shares had approximately 18.9% of assets invested in foreign companies. See the prospectus for a complete listing of the principal risks.

Davis Advisors began active daily management of Selected Special Shares on June 1, 2001. From May 1, 1993 until May 31, 2001, Davis Advisors had a subadvisor that handled the active daily management of the Fund.

Small cap companies have market capitalizations less than $3 billion. Mid cap companies have market capitalizations from $3 billion to $10 billion. Large cap companies have market capitalizations greater than $10 billion. Under normal circumstances, Selected Special Shares invests the majority of its assets in equity securities issued by companies with market capitalizations of less than $20 billion.

Morningstar assigns a stewardship grade to funds it covers. The overall stewardship grade is the sum of the following five components that are graded on a scale of A through F: Regulatory Issues, Board Quality, Manager Incentives, Fees, and Corporate Culture. The overall grade will range from an A to an F. Morningstar utilizes a fund’s public filings, responses to a survey sent out by Morningstar to the fund company and the expertise of the Morningstar analysts to determine a fund grade. The methodology for the Morningstar Stewardship grade is completely different from the performance-based Morningstar star rating and has no impact on the star rating. The grades are subject to change and are as of December 31, 2009.

Broker-dealers and other financial intermediaries may charge Davis Advisors substantial fees for selling its products and providing continuing support to clients and shareholders. For example, broker-dealers and other financial intermediaries may charge: sales commissions; distribution and service fees; and record-keeping fees. In addition, payments or reimbursements may be requested for: marketing support concerning Davis Advisors’ products; placement on a list of offered products; access to sales meetings, sales representatives and management representatives; and participation in conferences or seminars, sales or training programs for invited registered representatives and other employees, client and investor events and other dealer-sponsored events. Financial advisors should not consider Davis Advisors’ payment(s) to a financial intermediary as a basis for recommending Davis Advisors.

A bear market is defined as the Dow Jones Industrial Average being down more than 15% from a previous high.

Over the last five years, the high and low turnover ratio for Selected Special Shares was 53% and 24%, respectively.

Shares of the SelectedFunds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including possible loss of the principal amount invested.

Davis Distributors, LLC, 2949 East Elvira Road, Suite 101, Tucson, AZ85756, 800-243-1575.

Overview

Investment Strategy

Sixty Years of Investment Experience

Fund Attributes

Who Should Consider Selected Special Shares