Global Evolution

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FOR EDUCATION ONLY - NOT FOR SALES USE - SEE DISCLAIMERS

Introduction to

Frontier Sovereign Debt Markets

Financial Planning Association - Houston January 2016

(Quarterly data as of September 2015)

Frontier Definition

Countries exhibiting less developed financial, economic and governmental infrastructures ²  ~100 countries across the globe: Asia, Africa, Latin America

and developing Europe (less those deemed to be “bad actors”)

²  We focus on sovereign debt…that is, not corporate debt (which for our country universe we believe is too early for prudent investing)

²  We include both hard currency (dollar-based) bonds as well as local currency bonds

²  And…this is not about Greece…which is a distressed developed country and not China…where there are few ways of participating in their foreign debt. And not Puerto Rico.

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Frontier Debt Markets: Unique Countries with Individual Stories

Dominican Republic: Real rates ~ 10% and lower oil imports

Mongolia: Commodity resources estimated at 150 times of current GDP

Vietnam: The next high growth Aslan country?

Nigeria: Oil issues… but population realities: 2015-180mn 2050-400mn

Mozambique: Investments in natural gas ~$50bn or 3 times current GDP

Ethiopia: Average growth past decade 10.9% p.a.

Nicaragua: Increasing stability and a Nicaragua canal in the making

Argentina: A new political dawn?

Serbia: EU convergence and cheap labor

Pakistan: Political moderation and opportunity to increase tax collection

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Data as of September 30, 2015. Source: Global Evolution. Past performance is not a guarantee of future results. Returns and volatilities are subject to change over time. The data provided is for the Global Evolution UCITS IV fund and is provided for information purposes only. This fund is not available to US investors. Performance information referenced above is calculated gross of management fees and prior to deducting applicable administrative and operating expenses, such as custodian fees and/or trading expenses. These fees and expenses will vary among accounts.

Example: A Sample Risk-Managed Portfolio

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%

Local currency Hard currency

Number of Countries 36

Yield to Maturity 10.81%

Hard Currency Instruments 56.2%

Local Currency & FX Instruments 40.9%

Duration 3.58

Average S&P Rating BB-

Volatility 1 year 4.38%

Frontier Debt: Growth/Debt Balance

1. Opportunity to participate in the maturation of faster-growing countries typically with less debt than many developed countries

²  Countries offer favorable demographics, diversified or “advantageously positioned” resources, labor advantages and improving infrastructures

²  By 2050 “G7” will only be 1/3 of global GDP vs. 2/3 today ²  As of 2015 IMF Data, Emerging and Frontier world debt to GDP is

41% vs. 105% for more developed markets

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BELGRADE, SERBIA

2. Idiosyncratic risks have provided low correlation between markets and offered limited economic interdependency

²  FX correlation to other Frontier countries is low: often fewer global economic ties ²  Frontier sovereign bond market inefficiency can be tapped though in-depth research ²  Shorter maturities, higher coupons and both local and hard currency alternatives ²  Historically superior diversification – typically low (+/-20%) correlations to global equity

and fixed income markets (and may therefore reduce overall portfolio volatility by their inclusion.)

²  Oversight and support through international organizations and sponsor nations: •  International Monetary Fund, World Bank, etc. and the US, UK, France and Germany

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Frontier Debt: Lower Correlations

KARACHI, PAKISTAN

Data as of September 30, 2015 Past performance is not a guarantee of future results. Frontier data provided is for the Global Evolution UCITS IV fund and is provided for information purposes only. This fund is not available to US investors. FRONTIER is based on actual NET NAV for the Global Evolution Frontier Markets (Fixed Income) since inception (15 December 2010) after all costs. including management fees and performance fees as well as costs associated with administration. custodian etc. The index is in EUR.

Frontier Market Returns and Comparisons to other Asset Classes

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Key Figures

Correlations

FRONTIER JPM NEXGEM EMBI GD GBI-EM GD CEMBI BD MSCI EM WTI S&P500 US 10 YR

Return 77.9% 70.4% 58.6% 11.2% 59.3% -24.1% -51.9% 28.2% 53.1%

Volatility 5.5% 8.4% 7.0% 10.9% 4.0% 22.1% 36.8% 22.3% 7.7%

Sharpe Ratio 0.6 0.3 0.2 -0.3 0.4 -0.4 -0.4 -0.1 0.1

FRONTIER JPM NEXGEM EMBI GD GBI-EM GD CEMBI BD MSCI EM WTI S&P500 US 10 YR

FRONTIER 100% 53% 49% 37% 40% 34% 15% 20% -9%

JPM NEXGEM 100% 73% 45% 60% 47% 27% 26% -13%

EMBI-GD 100% 66% 67% 63% 29% 37% -4%

GBI-EM GD 100% 40% 74% 37% 39% -16%

CEMBI BD 100% 39% 15% 14% 11%

MSCI EM 100% 41% 50% -27%

WTI 100% 34% -26%

S&P 500 100% -44%

US 10 YR 100%

Source: Bloomberg, JP Morgan, Global Evolution. Data range: January 1, 2007 through October 9, 2015

Average Correlation ~ 20%

Low and Stable Correlations Over Time 250 Day Rolling Correlations vs. S&P 500 (as a proxy for risky assets)

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The chart depicts the rolling 250-Day correlation of a broad array of emerging market bond indices and the Global Evolution UCITS IV Frontier Fund compared to the S&P 500 Index. This data is provided for information purposes only. This fund is not available to US investors. Price data is provided by Bloomberg and calculated by Global Evolutions. It is historical analysis and is not intended to project these relationship in the future. Past price performance Is not a predictor of future performance. This information is not a solicitation for investors.

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EMBIGD GE Frontier Markets GBIEMGD JP Morgan US HY

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GEv Frontier Markets

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EMBIGD GE Frontier Markets GBIEMGD JP Morgan US HY MSCI Frontier Markets Next Generation Frontier S&P 500

Frontier Markets Has Exhibited Lower Volatility Over Time

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The chart depicts the rolling 60 volatility calculated using the standard deviation of daily price returns of Global Evolution’s Frontier Market fund portfolio and the most common emerging market bond indices offered by JP Morgan and the MSCI Emerging Market Equity Index. This data is provided for information purposes only. This fund is not available to US investors. Price data is provided by Bloomberg and JP Morgan and calculated by Global Evolutions. It is historical analysis and is not intended to project these relationship in the future. Past price behavior is not a predictor of future performance. This information is not a solicitation for investors.

Source: Bloomberg, JP Morgan, Global Evolution, data July 1, 2011 through October 9, 2015

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Frontier Debt: High Income

3. Higher income enhances total return: ²  Because of their smaller size

and/or their unique credit stories Frontier bonds often offer higher income.

²  Managing Local currency and Hard currency positioning can contribute to income as well.

DOMINICAN REPUBLIC

Yield and Currency Management

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2014 2013 2012 2011 Portfolio Turn Over 44% 38% 37% 81% Data from January 1, 2011 through September 30, 2015 Data provided is for the Global Evolution UCITS IV fund and is provided for information purposes only. This fund is not available to US investors.

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Local Currency exposure (LHS) Hard Currency exposure (LHS) YTM in % (RHS)

Duration in years (RHS) Frontier HC spread index in % (RHS)

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The Frontier in an EMD World: a 2015 Recap

A calm after the storm?

4. Global slowdown and fears of long term impacts on resource-exporting Frontier countries seems overblown:

² Global Evolution anticipates a declining growth in China tied to the compounding size of their economy and a shift toward services

² We see a Euro/$ in the 1.05-1.12 range; no USD spike likely…although global events could influence trading for short periods

² We anticipate oil staying in the recent trading range for 1st half 2016

²  Potential for strong demographics of Frontier countries

²  Already low commodity/bond prices; commodities strengthening in 2nd half 2016

² Opportunities in oil import savings, niche resource exports and labor cost advantages

Drawdown Analysis Low Correlations lead to Shallow Drawdowns during periods of Stress

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Source: JPMorgan, Bloomberg, Global Evolution. Data from December 10, 2010 to September 30, 2015. Past performance is not a guarantee of future results.

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Global Evolution - Frontier Fund JPM - Next Generation Index (Frontier hard currency) JPM - EMBIGD (EM hard currency) JPM - GBIEMGD (EM local currency)

MaxDrawdown

GlobalEvolution-FrontierFund 28.05.2015-29.09.2015 -7,33% 02.08.2011-04.10.2011 -4,44% 22.05.2013-25.06.2013 -3,78%

JPM-NextGenerationIndex(Frontierhardcurrency) 22.05.2013-24.06.2013 -9,70% 03.08.2011-04.10.2011 -8,89% 25.11.2014-16.12.2014 -7,12%

JPM-EMBIGD(EMhardcurrency) 02.05.2013-24.06.2013 -11,40% 03.08.2011-04.10.2011 -6,00% 26.11.2014-16.12.2014 -5,68%

JPM-GBIEMGD(EMlocalcurrency) 09.05.2013-29.09.2015 -30,67% 01.08.2011-04.10.2011 -11,56% 29.02.2012-01.06.2012 -8,60%

3.worstdrawdownperiod2.worstdrawdownperiodWorstdrawdownperiod

5. Liquidity: many global banks trade and even more local holders participate in the markets

²  Typically 1-1.5% Bid/Ask spreads and reasonable liquidity vs. Bank loans, High Yield, etc.

²  25-90% local participation in domestic bond markets ²  $400 Billion “Euroclear-settling” market globally but “1% rule”

minimizes impact of large fund players

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Frontier Debt: Liquidity

BANGLADESH

6. Fund Positioning: ²  Investors looking for exposure to EM and Frontier markets with

low correlation to other asset classes ²  Equity Investors looking to diversify from more volatile EM debt

and Equity into potentially less volatile Frontier debt ²  Investors looking to diversify their higher-yielding assets ²  Investors looking for lower duration and historically low standard

deviation of returns

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Frontier Debt: How Can the Asset Class be Used

ULAN BATOR, MONGOLIA

Using experience to “Play EM Differently” in the next decade

²  The 1990’s Emerging Market “play” was by-and-large successful; many countries did develop significantly and, as a result, saw the spread on their bonds decline (and their prices rise) over time as their credit quality improved.

²  As in US equities, “small cap” companies… or, in this case, countries… should imply higher risk as well as the opportunity for higher returns based more on the fundamentals of the underlying investment than broad market trends.

²  Subject to a successful risk-managed investment process, Frontier markets represent an opportunity to hit a “reset button” on prior EM debt market opportunities from the ‘90‘s with a new crop of growing countries.

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Frontier Debt in the Next Decade: An Alternative Perspective

Disclaimers

Global Evolution has published this marketing material primarily for the use of qualified investors and their consultants with the aim of informing on Global Evolution and Global Evolution ’s products and services. Marketing material means any information in writing on any kind of medium deriving both directly and indirectly from Global Evolution . The marketing material shall only be regarded as being general information on Global Evolution and Global Evolution ’s products and services The marketing material is thus a general service and information primarily to qualified investors and their consultants and shall not be regarded as being of consultative character. The marketing material cannot replace actual investment advice and/or general counselling on Global Evolution and Global Evolution’s products and services. Global Evolution requests any person which may have an interest in Global Evolution’s products and/or services to seek individual counseling. The marketing material cannot be invoked as basis for a decision on purchase or sale (or failure thereof) of securities. including Global Evolution’s products and/or services and Global Evolution undertakes no responsibility for decisions or transactions decided or undertaken on the basis of the marketing material. This means that Global Evolution cannot be made liable in damages for consequential losses. The marketing material does not constitute or include an invitation to tender for purchase or sale. an offer to purchase or sale or an invitation to keep securities already acquired. Global Evolution aims to keep the information in the marketing material as correct. adequate. available and updated as possible. however Global Evolution undertakes no responsibility for this. This means that Global Evolution cannot be made liable for damages for subsequent losses. Information deriving from Global Evolution as primary source. including. but not limited to. declarations. opinions. data. preconditions and the like shall only be valid at the time when these are made. All information can be changed without notice. including among others if Global Evolution learns that the marketing material is incorrect. Global Evolution undertakes no responsibility for the information being free from errors etc. This means that Global Evolution cannot be made liable for damages for subsequent losses. Global Evolution does not guarantee the correctness of information deriving from third party/other sources. including information explicitly mentioned in Global Evolution’s own marketing material or which Global Evolution may refer to in the marketing material. Distribution of the marketing material may be subject to certain restrictions in some countries. The marketing material is not prepared for the purpose of redistribution for which reason persons obtaining possession of this are obliged to check and observe such restrictions independently. Information in the marketing material is not an offer or an invitation to tender in any jurisdiction in which such an offer or such an invitation to tender is not allowed or to persons in relation to which such an offer or such an invitation to tender is not allowed. Persons having acquired the marketing material from a third party can not on the basis of the marketing material assert a claim or the like against Global Evolution . Additional information on Global Evolution and Global Evolution ’s products and services are available through current prospectuses and the latest published annual report and interim report. All rights to the available data prepared by Global Evolution and the intangible rights attached to the marketing material belong to Global Evolution and any kind of commercial redistribution or reproduction is prohibited without prior written consent.

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