© 2013 Hilltop Fund Management LLP | Regulated and authorised by the Financial Conduct Authority | +44 (0)20 7788 7799 | www.hilltop.co.uk 1

Underlying Portfolio fund* Headline strategy weighting

ATP Equity long/short non-directional 11.4%

SAC Volatility arbitrage 10.4%

RAB Tradefinance 9.8%

CRA Equitylong/shortnon-directional 9.7%

FJE Activistcredit 9.3%

LOP Long/shortconvertibles 8.0%

FSP Relativevaluecommodity 7.1%

CBK Volatility arbitrage 6.5%

PGD Equity long/short non-directional 6.1%

SEK Activistmicro-capequity 5.7%

TCC Equity long/short non-directional 5.4%

IAH Fixed income arbitrage 5.1%

WTH Long/short commodity 4.4%

TEM Long/shortmortgages 4.3%

SUT Long/shortcommodityequities 3.3%

COK Macrovolatility 3.2%

The Hilltop Decorrelated FundDelivering decorrelated returns in a highly correlated environment

The Hilltop Decorrelated Fund was down 0.2% in August, with half our sixteen managers up and half down. Theattributionofbothwasverysimilar(grossthefundwasflat)withcostscarryingusdown0.2%.Nofundsperformedoutsideofexpectations.AsmentionedinourJulyfactsheet,wearecurrentlyundertakingacomprehensivereviewofourentireshortlist,unsatisfiedaswearewithperformanceyeartodate.Thisprocesshashighlightedanumberofoutstandingmanagersexploitingnicheopportunitysets,whichwebelievewillcontinuetodeliverstronglyasymmetricreturns,quiteindependentofmarketconditions.Wehavestartedtoaddfourofthesefundstotheportfolio(twoinAugustandtwoinSeptember)andexpectacouplemoretofollowsuitshortly.Weareconfidentthatthesechanges,oncefinalised,willhelppushourmonthlyreturnsclosertoourtargetof+0.9%eachmonth(not,ofcourse,inastraightlinebutwithrelativelyfew(andminor)losingmonthsandwithnodiscerniblecorrelationtotraditionalbenchmarks.

Monthly perf (%)* Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec YTD2013 -0.8 0.3 0.1 0.5 -1.0 -0.2 0.5 -0.2 -0.82012 1.3 1.2 1.3 1.2 0.5 1.0 0.8 -0.3 0.3 -0.1 -0.3 2.7 9.72011 2.6 0.0 0.7 2.8 2.0 1.2 2.2 -0.4 2.0 0.4 3.6 4.2 23.22010 0.1 2.7 0.6 1.7 1.5 0.1 0.5 3.1 1.0 2.5 0.8 1.7 17.52009 2.7 -0.3 1.4 2.3 2.6 0.3 1.8 0.2 1.9 2.1 3.6 1.1 21.72008 2.3 -0.3 -1.5 0.5 2.9 1.4 -0.3 0.3 -0.7 5.1 3.0 1.8 15.0*Proformaresultsareshadedingrey.Resultsareshownnetofallfeesandcostsassumingafundsizeof$20mexcludinganyredemptionfees.

2008 2009 2010 2011 2012-6%

0%

6%

2008 2009 2010 2011 2012The Hilltop Decorrelated Fund MSCI World IndexHFRI Fund Weighted Composite Index HFRI FoF Composite Index

$0

$250

$100

Risk metrics (January 2008 – August 2013)

0 to 2 2 to 4-2 to 0 4 to 6-4 to -2-6 to -4% returns

Num

ber o

f mon

ths

0

10

20

30

40

NAV impact per fund Profit/loss ratio = 1.0x

0%

-0.4%

0.4%8 funds down, avg contributionper fund -1.0%

8 funds up, avg contribution per fund +0.09%

FSP SAC

E E EE E

E E EE E

FJEWTH CBKCRA ATP TEM TCC RAB SEK COKIAH SUT LOPPGD

2010 2011 2012High correlation Medium correlation Low correlation

-1

0

1

Distribution of returns

Contribution analysis (August 2013)

Rolling 24-mth correlation with MSCI World

Historical performance

Growth of $100 since inception

Asset allocation Length of track record

Liquidity AUM ($m)

Portfolio characteristics (as at August 2013)Portfolio snapshot

Monthly (71%)

Quarterly (29%)

R

e d u c i ng

Lending (8%)

Bonds/FI (4%) Mortgages (4%)

Volatility (17%)

Equities (35%)

Commodities(10%)

Cash(8%)

Credit (14%)

>9yrs (27%)

>2yrs<5yrs (56%) >5yrs<9yrs (17%)

D

e c li n i ng

>1bn (12%)

<50 (24%)

>100<200 (5%)

>200<500(25%)

>500<1bn(15%)>50<100

(19%)

D

e c li n i ng

The pros and cons of ‘back-tests’

Never seen a bad ‘back-test’? Neither have we.Discountingproformaresultsissober–thatsaid,thisportfolioisclearlyabletodeliverexcellentreturnswith:alackofdownmonths,lowcorrelationandlow(c.5%)volatility, whichwe are confident can bemaintained.Seeoverleafformoreguidance.

Decor-related Fund*

HFR FoF Composite

HFR Fund Weighted

CompositeMSCI World

Total return 120.5% -4.7% 11.9% -7.3%

Compound annual 15.0% -0.8% 2.0% -1.3%

Annual volatility 4.6% 6.2% 7.4% 19.9%

Downside deviation¥ 1.3% 5.6% 5.8% 15.6%

Max drawdown -1.8% -21.4% -20.1% -52.7%

Sharpe ratio¥ 2.6 -0.6 -0.1 -0.2

Sortino ratio¥ 9.2 -0.7 -0.2 -0.3

% positive periods 79.4% 58.8% 60.3% 50.0%

Average gain 1.6% 1.1% 1.5% 4.5%

Average loss -0.5% -1.7% -1.8% -4.4%

Skewness 0.5 -1.4 -0.8 -0.7

¥Assumesminimumacceptablereturnof3%.

Usesactualfunddurationdata exceptfortwofundswhich use strategy duration.

August 2013 -0.2%eAnestimate,basedonactualresultsfrom 6/16fundsandanestimatefrom10/16funds

© 2013 Hilltop Fund Management LLP | Regulated and authorised by the Financial Conduct Authority | +44 (0)20 7788 7799 | www.hilltop.co.uk 2

ISIN: GI000A1J6ZB9(USD) GI000A1T87X1(GBP) Bloomberg: HTDCBC2TL

Target returnsAnaverageof10-12%p.a.netoffeesover a three-year period

Expected volatilityLess than 5%

Correlation targetAmaximumof0.4totheMSCIWorldIndex over any three-year period and onaverageclosertozero

Investment liquidity75%ofAuMinvestedinfundswithmonthly redemption or better

LeverageMaximumof33%long-term and 10% short-term

Target size$500m

Share classUSD(£and€tofollow)

Fund domicile / typeGibraltar / Experienced Investor Fund

Minimum investment$10kifinvestedviaalifewrapper, $equivalentof€50kifadvisedby anIFA,€100kifinvestingdirectly

Fund liquidityMonthly

Redemption notice45days’notice

FeesInitialfee:none Managementfee:1.75%Performancefee:10%aboveHWM with3%trigger Redemptionfee:5%reducing

Fund managerHilltop Fund Management LLP

AuditorsDeloitte,Gibraltar

CustodianRoyalBankofCanada

AdministratorHelvetic Fund Administration

Legal advisersEvershedsLLP,HassansInternational

ContactCressidaStAubyn,InvestorRelations cressida.staubyn@hilltop.co.uk

Distribution partnerThe Synergy Partnership +60323010930

Hilltop’s Portfolio Manager, RoryHills, started his career in financialmarkets in 1986 and for 27 yearshas maintained an on-going and detailed engagement with a great many fund managers employing awiderangeofinvestmentstrategies.

Since 2002, Rory has focusedon selecting hedge funds forpotential inclusion in fund ofhedge fund (FoHF) portfolios,

first atDexionCapital where he also held in the region of1,000meetingswith FoHFs and for thepast three years atHilltop. This has given him tremendous insight into the hedge fund industry. During this time Rory has demonstrated atalent for recognising exceptional investment managers andstrategies,forexample12ofthe13fundshewasassociated

with during the credit crisis (Jul ‘07 to Feb ‘09), either torepresentto investorsand/orforpersonal investment,wereupintheperiod-halfofthembymorethan30%.

This combination of long-standing experience in respect ofunderstanding asset management strategies; a real appreciation ofwhatdoesanddoesnotworkwithinFoHFs;togetherwithaprovenabilitytoidentifydistinctive,value-addedhedgefundstrategies, is the ideal grounding for managing the HilltopDecorrelated Fund.

Investment thesis

Investment approach

Who are Hilltop, and why listen?

Mostliquidinvestments(andplentythatareilliquidtoo)areheavilyinfluenced by how “risk assets” are performing (forwhich theMSCIWorldIndexisanexcellentproxy)andconsequentlytendto be highly correlated to one another. The obvious exception is ‘highlyrated’governmentbondsbuttheselookexpensive,yieldalmost nothing andwhat can be considered ‘highly rated’ is a

moveablefeastcreatinga‘credit’elementtoowninggovernmentbonds which previously did not exist.

By investing in a range of ‘low correlation’ strategies (thoseseekingtodeliverreturnsindependentofmarketdirectionality),the Hilltop Decorrelated Fund has been designed to deliver the stable,decorrelatedreturnprofilesoughtbysomanyinvestors.

To achieve its targets Hilltop adopts a multi-manager approach investing in ten to15hedge fundstrategies,across theglobe,which we are convinced can deliver decorrelated returns on a sustainablebasis.Itisanimportantfeatureofourapproachthatwearenotmakingany‘macrocalls’and–withrareexceptions–neitherarethemanagersweareinvestingwith.Thisispartlybecause we do not believe anyone has an edge in makingsuchcallsandpartlybecauseeveniftheydid,theywouldwishtobehighlycorrelatedinabullmarketwhichrunscounterto

our ambition of being decorrelated at all times (it is entirelypossible to be up in a bullmarketwithout being correlated).Our preference is for managers pursuing a clearly definedopportunitysetandwiththerequisiteinvestmentskillstoexploitit.Whilst,onoccasion,thiscouldincludemanagersoperatinginunconventionalareastheprimaryfocusisonmanagersoperatingin mainstream asset classes (equities, fixed income, FX andcommodities)but inunusualand/ordistinctiveways.Thefundwillnotinvestinmanagerswithlessthana2½yeartrackrecord.

27 yrs’dialogue

with fundmanagers

11 yrs’hedge fundexperience

c.1,800single

managersreviewed

c.1,000meetings

withFoHFs

Optimal background for a FoHF managerRory Hills’ key highlights

Target investor audience

The Hilltop Decorrelated Fund is targetedatinvestorsseekingconsistentreturnswithlowvolatility,verylimiteddrawdowns and which are genuinely decorrelatedtoequitymarketseveninmomentsoffinancialcrisis.

Whilst Hilltop believes this return profile is attractive at any point inthe investment cycle, the currentenvironmentoflowinterestratesandincreased correlations amongst asset classesmakesitparticularlycompelling.

Thepro formaresultspresentedoverleafneedtobeproperlyqualified because, although the results of the underlying fundsarerealandreflecttheactualmixthattheinvestedportfoliowillhaveatinception,theportfoliowasnotinexistencepriortoitslaunchon1October2012.Itsselectionisinevitablyinfluenced,at least to some degree, by past performance. Nonetheless,thereareusefulinterpretationswhichwecandrawfromthedatathoughitisimportanttounderstandwhichtypeofmetricsmayprovide a reasonable guide to future performance andwhichmaynot.Returnmetricsshouldbemostsignificantlydiscountedas it is thesewhicharemostheavily affectedby thebenefitofperformance hindsight and it is inevitable that some fundswillfailtodeliverinthefuturethereturnstheyhavedeliveredinthepast.However,wecansayfromthedatathatasacombination,

thisgroupoffundsisverycapableofdeliveringexcellentreturns. Inrespectof‘risk’metrics,wedobelievequitealotcanbereadintothevolatilityoftheproformaresultsbecause,whilstfutureperformanceatthesub-fundlevelmaylookdifferentfromhowitdid inthepast,therangeofmonthlyreturnsshouldnot(thisbeingacorepartofHilltop’sanalysis).Similarly,webelieveagooddealcanbegarneredfromtheproformainrespectofthefuturecorrelationprofileofthisportfolio.Itisacentralpartofouranalysisthatthesefundsareabletodeliverreturnsuncorrelatedtoeachotheraswellasriskassetsingeneralandweexpectthisportfoliotoexhibitthesameleveloflowcorrelationinthefutureastheproformahasshowninthepast.Ofparticularnoteisthatthisdatacategoricallydisprovesthefallacythataportfolioofnon-correlatedfundswill‘canceleachotherout’.

How to interpret the pro forma results in this document

Thisdocumentdoesnotconstituteorformpartof,andmaynotbeusedforthepurposeof,anofferorsolicitationtoanyoneinanyjurisdictioninwhichsuchofferor solicitation is not authorisedor to anyperson towhom it isunlawfultomakesuchofferorsolicitation.SharesintheHilltopDecorrelatedFund(the“Fund”)willnotbeofferedtothegeneralpublic.Thisdocumentmaynotbedistributed in any jurisdictionwhere it is unlawful todo so.AsubscriptionforsharesintheFundmayonlybemadeinrelianceontheprivateplacementmemorandum and relevant supplement of Hilltop Funds PCCLimited by persons who are eligible to subscribe as set out in such documents.While the information in this document has been prepared in good faith,norepresentationorwarranty,expressor implied, isorwillbemadeandno responsibility or liability is or will be accepted by the Fund or Hilltop FundManagementLLP (“Hilltop”)orby anyof their respectivemembers,officers,employeesoragentsinrelationtotheaccuracyorcompletenessoftheinformationcontainedinthisdocumentandanysuchliabilityisexpresslydisclaimed. In particular, but without prejudice to the generality of theforegoing,norepresentationorwarrantyisgivenastotheachievementorreasonablenessofanyfutureprojections,managementestimates,prospectsorreturnscontainedinthisdocument.Actualresultsmayvaryfromestimates.

Hilltopisnotactingforanyrecipientofthisdocument.HilltopisnotresponsibletosucharecipientforprovidingprotectionsaffordedtoclientsofHilltopandHilltopisnotadvisingsucharecipientinrespectofinvestinginHilltopFundsPCCLimited.Pastperformanceisnotaguidetofutureperformance.The ‘pro-forma’ results in this document are calculated by the retroactiveapplicationofamodelconstructedonthebasisofthehistoricaldataoftheintendedunderlyingfundinvestmentsutilisedbytheFundatitsinceptionandinthesamemixatthelaunchdateoftheFund.ThereisnoassurancethattheFundwillbeabletoinvestintheintendedunderlyingfundsatlaunchand/orat the level intended. There is also no assurance that the Fund would have achievedthereturnsshownpriortoAugust2012andthepro-formareturnsareshownforillustrativeandinformationalpurposesonlyandshouldnotbeconstruedasanindicatoroffutureperformanceoftheFundoranyotherfundmanagedbyHilltop.Pro-formareturnsdonotrepresentactualtradingandmaynotreflecttheimpactthatmaterialeconomicandmarketfactorsmighthavehadonanydecision-makingiftheportfoliowereactuallybeingmanaged.Thepro-formareturnsalsoassumethattheFundwouldhavebeenabletopurchase the securities recommendedby themodeland that themarketsweresufficientlyliquidtopermitthistrading.HilltophasclientsotherthantheFundandresultsacrossclientsmaydiffermaterially.

Disclaimer