www.luxhedge.com  

November  2014  

The leading database for the universe of European alternative UCITS

LuxHedge: comprehensive analysis on the fast-growing alternative UCITS market

LuxHedge •  Tracks the performance and strategies of the rapidly growing universe of all alternative UCITS funds •  Analyses alternative UCITS strategies and reports a unique index benchmark for each strategy •  Provides consultancy services to clients in their research of the alternative UCITS universe •  Provides market data and intelligence based on individual fund performance and across strategies •  Brings together players in the alternative UCITS world

Since its inception in 2012, LuxHedge has developed deep and comprehensive expertise across the universe of all European alternative UCITS funds

2  

According to LuxHedge’s analysis, assets under management in the alternative UCITS markets in the year to 31 October 2014 have grown from EUR225bn to EUR291bn, a growth rate of 29%. There are now nearly 1,200 funds in the alternative UCITS universe…many with daily liquidity and all with at least fortnightly liquidity. Particular interest from institutional investors such as insurance companies, FoHFs and private banks who are drawn to regulated alternatives products with prompt liquidity.

LuxHedge is building a reputation as the leading provider of insight in the alternative UCITS world and is nurturing long-term relationships with clients based on transparency, independence and integrity, which are core values of our company.

LuxHedge: well-positioned to serve the rapidly growing alternative UCITS market

The pie chart below shows alternative UCITS AUM by strategy in EURm

3  

The alternative UCITS market continues to grow rapidly, offering an alternative to traditional hedge funds. Established, high quality managers continue to enter the market.

Number of Funds AUM (EURm) Less than 50M 50m - 100m 100m - 200m 200m - 300m 300m - 500m 500m - 1,000m Over 1bnLong/Short Global 80 8,467 46 10 9 3 4 3 5Long/Short Europe 107 20,763 50 15 13 6 4 11 8

Long/Short US 24 1,287 10 5 4 2 - 1 2Long/Short Emerging Markets 7 0,828 1 2 3 1 - - -

Long/Short Asia Including Japan 25 5,401 11 8 4 - - - 2Equity Market Neutral 108 19,114 49 22 14 6 3 7 7

Event Driven 43 5,784 23 7 6 1 1 3 2Fixed Income Arbitrage 228 102,931 70 33 25 21 24 22 33Convertibles Arbitrage 19 4,215 4 1 8 2 1 3 -

Currency Arbitrage 35 1,856 23 4 1 1 2 - 4Volatility Arbitrage 30 3,484 19 3 4 2 - 2 -

Commodity Arbitrage 18 33,884 11 4 - 2 1 - -CTA / Managed Futures 93 5,770 68 8 8 2 - 3 4

Global Macro 146 1,323 82 20 17 11 3 2 11Multi-Strategy 124 67,340 61 19 20 8 5 1 10

FOF 110 8,407 63 21 4 10 4 2 6TOTAL 1197 290,852 591 182 140 78 52 60 94

Number of funds within each AUM size range

The LuxHedge database: access to the universe of alternative UCITS

Our   constantly   updated   database   allows   users   to   track   and  compare  the  universe  of  alterna@ve  UCITS  in  respect  of:    

•  Strategy  type  (18  strategy  sectors  in  all)  •  Country  of  domicile  •  Historical   performance   in   user-­‐defined   @me-­‐frames  

over  the  preceding  5  years  •  Annualised  vola@lity   in  user-­‐defined  @me-­‐frames  over  

the  preceding  5  years  •  Assets  under  management  

The  analysis   for  each  fund   includes  a   link  to  the   latest  monthly  factsheet  and  KIID  in  the  website  of  the  underlying  fund  itself.    

We believe that LuxHedge offers the only database in existence which covers every European alternative UCITS fund

LuxHedge provides its users with access to a database of around 1,200 alternative UCITS funds.

4  

Risk Shell™: sophisticated analysis of the LuxHedge database of alternative UCITS

Risk  Shell  is  a  sophis@cated  analy@cal  plaRorm  that  offers  everything  to  deliver  the  most  compelling  risk  management  solu@ons  and  provide  effec@ve  asset  alloca@on  solu@ons  for  mul@-­‐asset  investment  porRolios.    

Risk  Shell’s  main  components  include:  

LuxHedge has teamed up with Risk Shell from ABCQuant to offer market-leading risk management and portfolio construction solutions to the Alternative UCITS world

©2014  ABC  Quant,  LLC.  All  rights  reserved  

delivers  a  number  of  alterna@ve  solu@ons  including  shorRall  risk  op@miza@on,  lower  par@al  moments,  maximum  or  condi@onal  drawdowns  and  many  more  

Screening  

Stress  tes@ng  

PorRolio  op@misa@on  

Returns-­‐  and  holdings-­‐based  analysis  

Peer  Group  Analysis  

filtering  the  universe  of  alterna@ve  UCITS  according  to  a  broad  selec@on  of  both  quan@ta@ve  and  qualita@ve  filters  

advanced  ins@tu@onal  grade  stress  tes@ng  of  mul@-­‐asset  porRolios  

delivers  an  innova@ve  concept  of  the  mul@dimensional  peer  analysis,  which  allows  building  rela@ve  ranks  charts  over  30+  different  sta@s@cs  simultaneously    

bespoke  analysis  on  user-­‐specific  porRolios    

employs  mul@variate  return-­‐based  sta@c  &  dynamic  style  analysis,  a  factor  model  to  explain  fund  returns  yet  iden@fy  granular  sources  driving  fund  performance  

Performance  aaribu@on  analysis  

5  

LuxHedge indices: tracking sectoral performance in the alternative UCITS world

The   indices  are  comprised  of  a  number  of   liquid,   tradable  underlying  alterna@ve  UCITS  funds  which  are  con@nuously  monitored  in  the  LuxHedge  database.  

Funds   included   in   each   index   must   pass   key   size   (20  million)   and   track   record   (6   months)   criteria   over   a   long  period  of  @me  to  warrant  their  inclusion  in  the  index.  

LuxHedge publishes 12 indices across a number of alternative UCITS strategies

•  Global  •  Long/Short  •  Long/Short  Europe  •  Equity  Market  Neutral  •  Fixed  Income  Arbitrage  •  Currency  Arbitrage  

•  Vola@lity  Arbitrage  •  Commodity  Arbitrage  •  CTA  /  Managed  Futures  •  Global  Macro  •  Mul@-­‐Strategy  •  Fund  of  funds  

Indices published

Each  index,  such  as  the  Long/short  Europe  example  shown  here,   includes  monthly   historical   data,   technical   sta@s@cs  and  benchmark  compara@ves.  

Factsheets  on  each  index  are  published  on  a  monthly  basis  and  distributed  to  LuxHedge  subscribers.  

6  

LuxHedge indices: alternative UCITS exposure at lower volatility

The   graph   here   shows   the   LuxHedge   index   annualised  returns   and   vola@lity   over   a   two   year   period   versus   the  benchmark  and  the  individual  cons@tuent  funds  within  the  LuxHedge  index.  

Returns consistent with the alternatives strategies of the underlying funds, but at lower levels of volatility

The  LuxHedge   indices,  such  as  the   latest   factsheet   for   the  Long/short   Europe   index   shown   here,   have   historically  generated   aarac@ve   returns   but   the   basket   of   underlying  funds   in   each   index   naturally   leads   to   lower   levels   of  vola@lity  associated  with  those  returns.  

The   lower   graph   shows   the   LuxHedge   index   components  evolu@on    on  a  half  year  basis.    

7  

Investor connections: a forum for managers to talk about their funds

Meetings: fund managers and prospective investors Fund manager interviews

LuxHedge  writes  balanced  and  well-­‐informed  interviews  for   managers   to   then   edit   and   enhance   giving   them   a  professional   and   focussed   point   of   promo@on   for   their  fund.      

We  also  arrange  bespoke,  private   mee@ngs   of   one  fund   manager   with   a  number   of   prospec@ve  investors.     These   allow   a  f o cus sed   d i s cus s i on  around   a   strategy   or  strategies,   relevant   to  b o t h   m a n a g e r   a n d  audience.  

Sessions  held  to  date  have  been  very  posi@vely  received  both  by  managers  and  investors.    LuxHedge  takes  care  to  ensure   that   there   is   a   suitable   investment   fit   amongst  par@cipants   to   help   ensure   a  meaningful,   commercially  relevant  discussion.  

We continue to encourage both existing and new users to to the LuxHedge website through news on new fund launches and links to other news stories within the alternative UCITS world

We   offer   managers   the   opportunity   to   describe  themselves  and  their  investment  funds  and  strategies  for  publica@on   on   the   LuxHedge   website:   an   example   is  below.  

LuxHedge website advertising

LuxHedge   also   offers   on-­‐line   adver@sing   packages   to  fund  managers.    This  is  a  cost-­‐effec@ve  way  for  funds  to  promote  themselves  to  their  focussed  target  market.  

8  

LuxHedge consultancy services: asset allocation in the alternative UCITS space

We   understand   that   different   investors   have   differing   levels   of   risk   appe@te   and   poten@ally   different   @me   horizons  associated  with  how  they  expect  returns  to  develop  as  well  as  interest  in  capital  protec@on  and  infla@on-­‐proofing  their  porRolios.  

 

 

LuxHedge  offers  consul@ng  services  to  investors  to  assist  them  in  seeking  out  the  alterna@ve  UCITS  fund  or  funds  which  best  suits  their  investment  criteria  and  risk  outlook.    This  may  involve:  

 

•  benchmarking  alterna@ves  funds  or  baskets  of  funds  against  other  indices  and  asset  classes;  

•  assessing  historical   fund  or  manager   returns  and  vola@lity  and  comparing  with  prevailing  market  condi@ons  over  the  same  period;  

•  filtering  the  universe  of  alterna@ves  funds  according  to  both  sophis@cated  quan@ta@ve  and  qualita@ve  criteria  based  on  discussions  with  investors;  

•  compe@@on  analysis  concerning  the  skills,  historical  performance  and  exis@ng  investment  criteria  of  different  managers  working  in  largely  similar  strategies.  

 The  nature  and  extent  of  services  is  tailored  to  each  client’s  specific  requirements.  

LuxHedge  is  unaffiliated  to  any  one  fund  manager  or  group  of  fund  managers  in  the  alterna@ves  space:  advice  is  strictly  unbiased.  

9  

By focusing only on the area of alternative UCITS, LuxHedge has built up a deep level of expertise and knowledge on the world of liquid listed alternatives strategies across Europe.

Tailored  services  to  analyse  strategies,  sectors,  geographies,  quant  analy@cs,  etc.  

LuxHedge: key personnel

Daniel  is  the  CEO  of  LuxHedge  which  he  established  in  2012.  He  is  in  addi@on  the  CEO  of  Orionis  Management  where  he  undertakes  mandates  as  independent  director  and  conduc@ng  office  for  various  investment  funds  and  companies  with  more   than  EURxxb  under  management.    He  has  more   than  30  years  of  professional  experience,   including  9  years  at  Kredietbank  Luxembourg  (KBL)  as  Head  of  Ins@tu@onal  Asset  Management  and  xx  years  as  corporate  client  manager  at  JPMorgan.  Daniel  is  a  CFA  and  holds  a  degree  in  Commercial  Management  Engineering  from  the  University  of  Louvain  and  a  MBA  from  the  University  of  Chicago.    

Daniel Van Hove, CFA

Alexandre Millet

Florent Perret

Alexandre  has  worked  alongside  with  Daniel  in  Orionis  Management  since  2007.    He  has  dedicated  100%  of  his  @me  to  LuxHedge  since  2012,  at  the  crea@on  of  the  company.    Alexandre  is  in  charge  of  the  maintenance  and  monitoring  of  the  LuxHedge  database  and  tracks  the  performance  of  all  exis@ng  alterna@ve  UCITS  funds.  His  extensive  knowledge  of  the  1,200   funds   listed   in   the   LuxHedge’s   database   and   his   aaen@on   to   detail   give   him   vital   insight   on   the   world   of  alterna@ve   UCITS   which   he   uses   to   advise   clients.   Alexandre   also   manages   the   content   of   the   LuxHedge   website  (newsleaers,  monthly  factsheets,  indices,…)    He  studied  mathema@cs  at  the  University  of  Reims,  gradua@ng  in  2004.  

Florent  leads  on  LuxHedge  website  and  business  development,  liaising  with  the  investor  and  investment  management  community  to  offer  LuxHedge  services  and  constantly  improve  the  LuxHedge  offering.    He  works  with  fund  managers  to  write  interviews  for  the  website  explaining  their  fund  strategy.  He  also  focuses  on  bringing  together  professionals  of  the  alterna@ve  UCITS  market;  for  instance  organising  mee@ngs  between  managers  and  poten@al  investors.    Prior   to   joining   LuxHedge   in   2013,   Florent   worked   in   Asset   and   Liabili@es   Management   at   Caisse   d’Epargne.   He  graduated  from  IESEG,  School  of  Management  (France)  in  2014.    

Andrew Pearson

Andrew   is   LuxHedge’s   representa@ve   in   London.     He  worked   for   over   nine   years   un@l   2014   at   bou@que   investment  manager,  Climate  Change  Capital  (CCC).    He  was  chief  opera@ng  officer  for  its  EUR700m  carbon  fund,  the  biggest  private  carbon  credits   fund   in  the  world.     In   the   laaer  years  he   led  the  management  of   this   fund,  splirng  his  @me  between  London  and  Beijing.    Prior  to  CCC  he  worked  in  wholesale  banking  in  London.    He  has  a  degree  in  the  Natural  Sciences  from  the  University  of  Cambridge  and  is  a  qualified  (but  not  prac@sing)  chartered  accountant.  

10  

Contact information

Florent  Perret  fp@luxhedge.com  +352  26  44  01  70  36  www.luxhedge.com  

Disclaimer

13  

This  document  has  been  prepared  for  informa@on  purposes  for  Ins@tu@onal  investors  only.  It  doesn't  cons@tute  an  offer  or  solicita@on,  or  as  the  basis  for  any  contract,  for  the  purchase  or  sale  of  any  investment,  nor  do  they  cons@tute  an  offer  or  solicita@on  in  any  jurisdic@on  in  which  such  an  offer  or  solicita@on  is  not  authorized  or  to  whom  it  is  unlawful  to  make  such  solicita@on  or  offer.  It  has  been  prepared  on  the  basis  of  informa@on  and  sources  believed  to  be  reliable.  All  reasonable  care  has  been  taken  to  ensure  that  the  facts  stated  are  accurate  but  LuxHedge  S.A.  shall  not  in  any  way  be  responsible  for  the  contents.  Past  Performances  are  not  necessarily  indica@ve  of  future  results.  

The  LuxHedge  website  is  an  internet  portal  intended  for  informa@onal  purposes  and  based  solely  on  informa@on  and  data  supplied  either  by  own  research,  by  investment  managers  or  by  other  qualified  third  par@es.  It  is  exclusively  addressed  and  intended  for  professional  investors  or  industry  service  providers.  Nothing  contained  on  the  LuxHedge  website  should  be  interpreted  as  a  solicita@on  or  inducement  for  an  investment  and  reference  to  a  par@cular   investment  manager,   service  provider  or  product  under  no  circumstance  represents  an  endorsement  or   recommenda@on  by  LuxHedge  of   that   investment  manager,  service  provider  or  product.  A  prospec@ve  investor  for  any  product  or  service  men@oned  on  the  LuxHedge  website  should  independently  inves@gate  the  investment  manager  and/or  service  provider  and  consult  with  independent  and  qualified  sources  before  engaging  in  any  ac@vity  with  them.  Investors  should  also  be  aware  that  historical  performance  numbers  presented  on  the  LuxHedge  website  are  not  indica@ve  of  future  performance  and  furthermore,  investments  in  hedge  fund  vehicles  involve  significant  risks,  including  loss  of  capital.  

Opinions  expressed  on  the  LuxHedge  website  are  not  necessarily  those  of  LuxHedge  and  LuxHedge  assumes  no  responsibility  for  the  contents  of  contributed  ar@cles.  

LuxHedge  expressly  disclaims  any  and  all  responsibility  for  any  direct  or  indirect  loss  and/or  damage  of  any  kind  whatsoever  arising  directly  or  indirectly  form  (i)  the  use  of  informa@on  provided  by  the  LuxHedge  website,  (ii)  reliance  on  any  informa@on  contained  herein,  (iii)  any  error,  omission  and/or  inaccuracy,  in  any  such  informa@on  or  (iv)  any  ac@on  resul@ng  therefrom.  

The  LuxHedge  website  and  the  tools  and  material  contained  therein  are  the  property  of  LuxHedge  S.A.,  a  Luxembourg  limited  company,  with  registered  office  located  at  370,  route  de  Longwy,  L-­‐1940  Luxembourg  and  business  licence  number  10020133/0.  

370,  route  de  Longwy  L-­‐1940  

Luxembourg