Download Endowments, Foundations, and Investment Management

Foundations, Endowments, and
Investments
Presented by
Barry N. Berlin, CFA
Managing Director
Topics
1. Fiduciary Duty and Investments
2. Defining the Relationship – the IPS
3. Diversification, Asset Allocation, and Forecasting
4. Selecting Advisors and Managers
5. Evaluating Investments
6. Investing in Today’s Environment
2
Fiduciary Duty and Investments
Fiduciary Duty is defined by GA Code, Section 44-15 – the Uniform Prudent
Management of Institutional Funds Act.
3
Defining the Relationship – The Investment Policy Statement
•
•
•
•
•
•
•
Describes purpose of institution, and fund; relates investment success/failure to the
institution’s fortunes.
Proposes time horizon for investments, and any limitations or adjustments that differ from a
perpetual framework. Review horizon, and time horizon, would be quite different.
Sets reasonable goals with respect to returns, risks, and distributions. Defines benchmarks.
Illustrates constraints relating to liquidity, concentrated holdings, income vs. total return,
specific asset classes, social investing, etc.
Stipulates asset mix guidelines, and appropriate ranges for each major category.
Sets meeting/review timetable, and specific items to be reviewed.
Incorporates Policy Statement in Board minutes.
For examples, simply search the internet for ‘Investment Policy Statement’ and many versions will
appear.
4
Diversified or Confused by Forecasts?
5
Diversification vs. Forecast-Driven Approaches
•
Is the future “knowable”? Consider these “big drivers” of economic/market change over the
last 30 years…







6
The Internet was unknown 20 years ago;
The collapse of the Soviet Union surprised most people, even the Soviets;
Terrorism’s impact on US budget and economy (wars, homeland security, etc.);
The housing bubble wasn’t understood until near the end;
The drop in Gov’t bond yields from 15% to under 1%;
China’s dominance in manufacturing;
The rise of hedge funds, derivatives, and short-term trading as market players.
What are the odds of consistently forecasting market turns correctly?
7
Diversification
•
•
•
•
8
Multiple high quality
investments, with less than
perfect correlation
Each asset has ability to
meet/exceed benchmark
within it’s category
Gradually adjust category
weightings when out of
balance, when goals change,
or when profound market
imbalances suggest changes
Multiple managers, to
increase odds of success
The Case for Multi-Asset Class Investing:
Annual Returns for Various Asset Classes
2Q11
No single asset class exhibits the best performance consistently. However, a diversified
approach balances out over the yearly returns.
15%
43%
19%
47%
64%
68%
53%
35%
41%
52%
22%
32%
28%
49%
58%
73%
23%
8%
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011 YTD
MSCI EAFE
7.8%
R1000V
38.4%
R1000G
23.1%
R1000V
35.2%
R1000G
38.7%
MSCI EM
66.4%
R2000V
22.8%
R2000V
14.0%
Bar Agg
10.3%
MSCI EM
56.3%
MSCI EM
26.0%
MSCI EM
34.5%
MSCI EM
32.6%
MSCI EM
39.2%%
Bar Agg
5.2%
MSCI EM
78.5%
R2000G
29.1%
R2000G
8.6%
MSCI Wrld
5.1%
S&P 500
37.6%
S&P 500
23.0%
S&P 500
35.2%
S&P 500
28.6%
R2000G
43.1%
Bar Agg
11.6%
Bar Agg
8.4%
MSCI EM
-6.0%
R2000G
48.5%
R2000V
22.3%
R1000G
11.8%
R2000V
-28.9%
RMIDCAP
40.5
R2000
26.9%
RMIDCAP
8.1%
R1000G
2.6%
R1000G
37.2%
R1000V
21.6%
R2000V
31.8%
MSCI Wrld
24.3%
R1000G
33.2%
RMIDCAP
8.3%
R2000
2.5%
R2000V
-11.4%
R2000
47.3%
MSCI EAFE
20.3%
RMIDCAP
12.7%
R2000V
23.5%
MSCI EAFE
11.8%
R2000
-33.7%
R1000G
37.2%
RMIDCAP
25.5%
R1000G
6.8%
S&P 500
1.3%
RMIDCAP
34.5%
R2000V
21.4%
R1000G
30.5%
MSCI EAFE MSCI EAFE
20.0%
30.0%
R1000V
7.0%
MSCI EM
-2.4%
R1000V
-15.5%
R2000V
46.0%
RMIDCAP
20.2%
MSCI Wrld
9.6%
R1000V
22.3%
MSCI Wrld
9.0%
R1000V
-36.8%
R2000G
34.5%
R2000V
24.5%
R2000
6.2%
R2000V
-1.5%
R2000G
31.0%
RMIDCAP
19.0%
RMIDCAP
29.0%
R1000V
15.6%
MSCI Wrld
24.7%
R2000
-3.0%
R1000V
-5.6%
MSCI EAFE
-15.9%
RMIDCAP
40.0%
R2000
18.3%
R1000V
7.1%
MSCI Wrld
19.9%
R2000G
7.1%
S&P 500
-36.8%
MSCI EAFE
31.8%
MSCI EM
59.9%
S&P 500
6.0%
R2000
-1.8%
R2000
28.5%
R2000
22.4%
R2000
22.4%
RMIDCAP
10.1%
R2000
21.3%
S&P 500
-9.1%
RMIDCAP
-5.6%
RMIDCAP
-16.2%
MSCI EAFE
38.6%
R1000V
16.5%
R1000G
5.3%
R2000
18.4%
Bar Agg
7.0%
R1000G
-38.4%
MSCI Wrld
30.0%
R1000G
16.7%
R1000V
5.9%
R1000V
-2.0%
R2000V
25.8%
MSCI Wrld
13.5%
MSCI Wrld
15.8%
Bar Agg
8.7%
S&P 500
21.0%
MSCI Wrld
-13.1%
R2000G
-9.2%
MSCI Wrld
-19.9%
MSCI Wrld
33.1%
MSCI Wrld
14.7%
S&P 500
4.9%
S&P 500
15.8%
RMIDCAP
5.7%
R2000G
-38.5%
R2000
27.2%
R1000V
15.5%
MSCI Wrld
5.3%
RMIDCAP
-2.1%
MSCI Wrld
20.7%
R2000G
11.3%
R2000G
13.0%
R2000G
1.2%
RMIDCAP
18.2%
MSCI EAFE
-14.2%
S&P 500
-11.9%
R2000
-20.2%
R1000V
30.0%
R2000G
14.3%
R2000V
4.7%
RMIDCAP
15.3%
S&P 500
5.5%
RMIDCAP
-41.4%
S&P 500
26.5%
S&P 500
15.1%
MSCI EAFE
5.0%
R2000G-2.4%
Bar Agg
18.5%
MSCI EAFE
6.1%
Bar Agg
9.7%
R2000
-2.6%
R1000V
7.4%
R1000G
-22.4%
MSCI Wrld
-16.8%
S&P 500
-22.1%
R1000G
29.8%
S&P 500
10.9%
R2000
4.6%
R2000G
13.4%
R1000V
-0.2%
MSCI Wrld
-40.6%
R2000V
20.6%
MSCI Wrld
11.8%
R2000V
3.8%
Bar Agg
-2.9%
MSCI EAFE
11.2%
MSCI EM
6.0%
MSCI EAFE
1.8%
R2000V
-6.5%
Bar Agg
-0.8%
R2000G
-22.4%
R1000G
-20.4%
R1000G
-27.9%
S&P 500
28.7%
R1000G
6.3%
R2000G
4.2%
R1000G
9.1%
R2000
-1.6%
MSCI EAFE
-43.3%
R1000V
19.7%
MSCI EAFE
7.8%
Bar Agg
2.7%
MSCI EM
-7.3%
MSCI EM
-5.2%
Bar Agg
3.6%
MSCI EM
-11.6%
MSCI EM
-25.3%
R2000V
-1.5%
MSCI EM
-30.6%
MSCI EAFE
-21.4%
R2000G
-30.3%
Bar Agg
4.1%
Bar Agg
4.3%
Bar Agg
2.4%
Bar Agg
4.3%
R2000V
-9.8%
MSCI EM
-53.2%
Bar Agg
5.9%
Bar Agg
6.5%
MSCI EM
0.9%
MSCI EAFE MSCI EAFE
13.5%
26.3%
Best
Worst
Bar Agg is the Barclays Capital U.S. Aggregate Bond Index, which includes U.S. government, corporate, and mortgage-backed securities with maturities up to 30 years. The MSCI World Index
is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed markets. MSCI EAFE Index (Europe, Australasia, Far East)
is a free float-adjusted market capitalization index designed to developed-market equity performance, excluding the U.S. & Canada. MSCI Emerging Markets Index is a free float-adjusted
market capitalization index that is designed to measure equity market performance in the global emerging markets. Russell 1000 Value Index measures the performance of those Russell 1000
companies with lower price-to-book ratios and lower forecasted growth values. Russell 1000 Growth Index measures the performance of those Russell 1000 companies with higher price-tobook rations and higher forecasted growth values. Russell 2000 Index measures the performance of the 2,000 smallest companies in the Russell 3000 index. Russell 2000 Growth Index
measures the performance of those Russell 2000 companies with higher price-to-book ratios and higher forecasted growth values. Russell 2000 Value Index measures the performance of those
Russell 2000 companies with lower price-to-book ratios and lower forecasted growth values. Russell Midcap Index measures the performance of the 800 smallest companies in the Russell 1000
Index. S&P 500 Index, a market-value weighted index, consists of 500 U.S. stocks chosen for market size, liquidity, and industry group representation. Past performance does not guarantee
comparable future results. Returns reflect reinvested distributions. Numbers displayed in NAVY represent the variance between the best and worst performance.
Source: Lazard, StyleADVISOR, Atlantic Trust. As of 06/30/11.
9
For Public Use
Correlations
10
Access Across Asset Classes
 Cash Management
 Hedge Fund-of-Funds  Directional Equity
 High-Quality Municipal  Multi-Strategy
 Directional Credit
Bonds
 Non-Directional Equity
 High-Quality
 Non-Directional Credit
Taxable Bonds







Higher Risk / Higher Potential Return
Large Cap Growth
Large Cap Value
Mid Cap Growth
Mid Cap Value
Small Cap Growth
Private
Equity
Small Cap Core
Small Cap Value
Real Estate
Non-U.S.
Equity
U.S. Equity
Fixed
Income
NonDirectional
Hedge Funds
Directional
Hedge Funds
 Private Real Estate
 Developed
International
 Emerging Markets
Lower Risk / Lower Potential Return
This is a generalization of asset classes. Many of the sub-asset classes would appear in different positions on the risk/reward chart.
*As of June 30, 2011.
11 For Public Use 08/11
Multi-Manager Investment Program - Overview
Partnerships
 Venture Capital
 Leveraged Buyouts
 Special Situation
Funds
 Fund-of-Funds
Diversification – Select Categories and Managers Carefully
12
Selecting Advisors – Some Key Questions
1. Is your investment platform in-house, out-sourced, or a blend? What incentives, if any, exist
to predispose recommendations towards in-house, vs. outside, programs?
2. Fee layering is an ongoing issue in the wealth management arena. Distinguish between fees
paid directly by XYZ to your firm, and other fees to be absorbed by XYZ. In what instances
will XYZ experience layered fees?
3. Will your firm receive income of any kind from outside money managers or vendors you use
or recommend? These types of fees include but are not limited to 12b-1 fees, rebates and
soft dollars. Describe in detail.
13
Fees – NACUBO/CommonFund Study, 2010
14
4.
Do you use a captive broker/dealer to execute client trades? Do any of your outside
managers trade through this broker-dealer, generating commissions of any kind for your firm? If
the XYZ account trades securities, will trades route through your captive broker/dealer? Will you
make money on the bid/ask spread of any stocks, bonds, or other instruments that your firm
recommends and/or implements?
5.
What is the total fee for the money market fund where our cash reserves will be held?
Who earns the fee?
6.
When representing investment performance, do your statistics include all accounts of a
similar description, including those that have since left your firm? Are your statistics “actual”, or is
some of the historical data pro forma, representing a back-test of recommended managers that
weren’t in use at the time?
15
7.
Describe the team supporting the XYZ relationship. What are the professional
credentials of each participant? Please describe all past and current regulatory, legal, or ethics
actions raised against any of these team members.
8.
Do you provide customized reports detailing performance and other important
items? How often? Please provide examples.
9.
What practices does your firm engage to ensure consistency among clients?
10.
books?
Describe your regulatory framework, and audit practices. Which CPA firm audits your
11.
16
Where will XYZ’s investment be held in custody? Can assets be verified
independently?
Evaluating Investments
17
XYZ Hedge Fund
Firm Profile
XYZ Hedge Fund was founded in 1993 and is the General Partner of the XYZ Partners funds with offices in Atlanta and Hong Kong.
Portfolio Management Team
Manager A is the founder and portfolio manager. He is supported by a team of seasoned analysts and a general manager. The analysts team
possess either industry specific experience or private equity experience, accompanied secondarily by investment research experience.
Portfolio Management
XYZ Hedge Fund
Atlanta, GA
Fund Facts
Inception Date
October 2001
Firm Asset
$4.1B
Fund Assets
Status
$9.9m
Soft Close
Offering
Min.
Investment
3c7
$3,000,000
Management Fee
1.50%
Performance Fee
20.00%
Liquidity
Quarterly
Lock Up
None
Notice Period
45 Days
Early Withdrawal
n/a
Hurdle Rate
No
High Water Mark
Gate Provisions
3Q11
Yes
20% of Fund
Objective
To achieve high, absolute returns – in all markets.
Philosophy
XYZ Partners are long-term investors, not traders, utilizing a longer term view than the market, which is believed to be a primary determinant of
above market performance.
Process
XYZ Partners utilizes a long-term, value-based approach paired with extensive due-diligence. XYZ Partners takes a holistic view in the investment
decision-making process by evaluating the fundamental quality, sustainability, valuation, timing, volatility and size of the individual positions within
the portfolio. Their goal is to line up as many things in their favor as they can.
Their investment philosophy focuses on three main principles: 1) Long-term (3 Year) investment horizon on both the long and short side; 2)
primary, private equity-like research and due diligence style; 3) leveraging principal’s operating experience and existing relationships to make
public investment decisions. On the long side, they seek value-oriented companies with a sound business plan and long-term sustainable cash
flow and asset appreciation. On the short side they look for fundamentally flawed, low quality, single product companies, and not just over-priced
companies.
They seek above average returns while managing risk through position and sector sizing, diversification, and in-depth fundamental due diligence.
Volatility is believed to be a short term risk that is not the best measure of real investment risk. However, portfolio exposures are reduced if the
fund has sustained negative performance in the range of 6% to 8%.
Investment Highlights

Long-term investment approach and private equity like discipline has generated significant alpha, despite directional market exposure

The PM and analysts all have substantial industry experience, supplemented with a strong history of investment performance

Flexible mandate allows them to seek the best risk-reward opportunities in the global equity market

Rigorous due diligence within a disciplined process in selecting companies to buy and sell

Greater tax-efficiency that most equity long/short strategies due to the long-term investment horizon
Suitability
To ensure proper diversification, this investment allocation should not be more than 3% of total portfolio.
Investment Results vs. Benchmark (%)
Net Returns as of September 30, 2011
Annualized Returns
Std. Deviation
3Q11
YTD
2010
2009
2008
2007
2006
2005
1 Yr
5Yr
10 Yr
5 Yr
10 Yr
XYZ Hedge Fund
-22.36
-20.57
16.23
52.62
-20.52
18.50
22.56
27.22
-11.40
7.92
11.72
20.08
15.58
HFRI Equity Hedge (Total) Index
-9.58
-8.70
10.45
24.57
-26.65
10.48
11.71
10.60
-2.63
1.40
5.12
10.38
8.53
S&P 500
-13.87
-8.68
15.06
26.46
-37.00
5.49
15.79
4.91
1.14
-1.18
2.82
18.32
15.75
Source: StyleADVISOR, GMT. This information and the offering materials relating to the offer of the Fund interests are strictly confidential and may not be distributed to any person or entity
other than the recipient hereof to whom this summary is personally offered. This summary is not authorized for distribution unless accompanied or preceded by the Private Placement
Memorandum (PPM) for the Fund. Please refer to the PPM for more detailed information concerning the Fund. Material is compiled from sources believed to be reliable and current, but
accuracy cannot be guaranteed. This is not an offer to buy or sell any financial instruments. Past performance is not indicative of future results. All performance is net of fees.
18
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XYZ Hedge Fund
3Q11
Manager vs. Benchmark as of September 2011
Manager vs. Equity Hedge Fund Universe September 2011
10
20
5
10
-5
XYZ Hedge Fund
HFRI Equity Hedge (Total) Index
S&P 500
-10
Return
Return
0
XYZ Hedge Fund
HFRI Equity Hedge (Total) Index
S&P 500
0
5th to 25th Percentile
25th Percentile to Median
Median to 75th Percentile
75th to 95th Percentile
-10
-15
-20
-20
-25
-30
1 quarter
1 year
2 years
3 years
4 years
5 years
1 quarter
1 year
2 years
3 years
4 years
5 years
Risk-Return Table October 2001 September 2011 : Annualized Summary Statistics
-
Return
(%)
Std Dev
(%)
Downside Risk
(%)
Cash-Adj
Beta
Cash-Adj
Alpha
Cash-Adj
R-Squared
Sharpe Ratio
Tracking Error
(%)
XYZ Hedge Fund
11.72
15.58
11.40
0.74
9.22
56.69
0.63
11.01
HFRI Equity Hedge (Total) Index
5.12
8.53
6.70
0.45
2.54
69.02
0.38
9.88
S&P 500
2.82
15.75
12.06
1.00
0.00
100.00
0.06
0.00
Up/Down Table October 2001 September 2011 : Single Computation
-
# of Months
Up
Down
Average Return vs. Market
Up
Down
1-Year (%)
Best
Worst
Up Capture
Market Benchmark
Down Capture
R-Squared
XYZ Hedge Fund
78
42
2.86
-2.03
79.85
-33.54
92.04
56.12
56.71
HFRI Equity Hedge (Total) Index
79
41
1.77
-1.76
28.35
-26.65
54.41
47.90
68.94
S&P 500
75
45
3.04
-4.18
53.62
-43.32
100.00
100.00
100.00
Source: StyleADVISOR, XYZ Partners. This information and the offering materials relating to the offer of the Fund interests are strictly confidential and may not be distributed to any person
or entity other than the recipient hereof to whom this summary is personally offered. This summary is not authorized for distribution unless accompanied or preceded by the Private
Placement Memorandum (PPM) for the Fund. Please refer to the PPM for more detailed information concerning the Fund. Material is compiled from sources believed to be reliable and
current, but accuracy cannot be guaranteed. This is not an offer to buy or sell any financial instruments. Past performance is not indicative of future results. All performance is net of fees.
The Equity Hedge Fund Universe contains 250 Hedge Fund Managers as of September 30, 2011.
19
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XYZ Hedge Fund
3Q11
Periodic Returns (%)
XYZ Hedge Fund
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Year
2011
1.50%
1.20%
-0.40%
2.10%
-1.20%
-0.87%
-1.80%
-8.60%
-13.50%
-
-
-
-20.57%
2010
-5.60%
5.20%
5.40%
-0.40%
-6.90%
-5.20%
8.00%
-3.90%
9.10%
5.20%
-0.15%
6.20%
16.23%
2009
-7.12%
-9.27%
6.74%
17.97%
12.34%
-1.90%
11.22%
2.66%
8.31%
-2.24%
5.14%
2.67%
52.62%
2008
-1.40%
2.20%
-1.50%
5.50%
2.60%
-4.00%
-3.30%
-0.30%
-9.00%
-12.80%
-4.80%
5.80%
-20.52%
2007
0.40%
-0.50%
2.50%
1.90%
1.60%
1.33%
1.00%
0.60%
3.50%
3.60%
-1.50%
2.80%
18.50%
Max Drawdown Table
October 2001 September 2011 : Summary Statistics
Correlation Matrix
October 2001 September 2011
-
-
1
2
Max
Drawdown
Drawdown
Length
Recovery
Length
XYZ Hedge Fund
-37.66%
9
7
1)
XYZ Hedge Fund
1.00
HFRI Equity Hedge (Total) Index
-30.59%
16
24
2)
HFRI Equity Hedge (Total) Index
0.79
1.00
S&P 500
-50.95%
16
N/A
3)
S&P 500
0.75
0.83
3
1.00
Source: StyleADVISOR, XYZ Partners. This information and the offering materials relating to the offer of the Fund interests are strictly confidential and may not be distributed to any
person or entity other than the recipient hereof to whom this summary is personally offered. This summary is not authorized for distribution unless accompanied or preceded by the Private
Placement Memorandum (PPM) for the Fund. Please refer to the PPM for more detailed information concerning the Fund. Material is compiled from sources believed to be reliable and
current, but accuracy cannot be guaranteed. This is not an offer to buy or sell any financial instruments. Past performance is not indicative of future results. All performance is net of fees.
20
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Disclosure
Definitions:










Alpha – Alpha is the incremental return on a manager when the market is stationary or the extra expected return due to non-market factors. The risk-adjusted
measurement takes into account both the performance of the market as a whole and the volatility of the manager. A positive alpha indicates that a selected
portfolio has produced returns above the expected level at that level of risk, and vice versa for negative alpha.
Beta – A measurement indicating the volatility of a manager relative to a chosen market. A beta of 1 means a manager has about the same volatility as the
market. A beta higher than 1 means the manager is more volatile than the market, while a beta lower than 1 means less volatile.
Best Return – Within a selected date range (e.g., 5 years), the manager’s best rate of return.
Downside Market Capture – A measure of the manager’s performance in down markets relative to the market itself. A value of 90% suggests the manager’s loss
is only nine tenths of the market’s loss.
R-Squared – A statistical measure that represents the percentage of a portfolio’s or security’s movements that are explained by the movements in a benchmark
index.
Sharpe Ratio – A measure of the risk-adjusted return of a portfolio, the Sharpe Ratio is equal to the excess return over the risk-free rate divided by the standard
deviation of the portfolio. The ratio can be used to compare the performance of managers. If two managers had the same level of risk but different levels of
excess return, the manager with the higher Sharpe ratio would be preferable because the manager achieved a higher return with the same level of risk as the
other manager.
Standard Deviation – Standard deviation is a statistical measure of a portfolio’s total risk and indicates the variability of the portfolio’s returns over a period of time.
A higher standard deviation implies a riskier portfolio whose returns varied widely.
Tracking Error – Tracking error is a statistical measure of how closely a portfolio tracks the performance of the index to which it is benchmarked and is generally
defined by the annualized standard deviation of active returns.
Upside Market Capture – A measure of the manager’s performance in up markets relative to the market itself. A value of 110% suggests the manager performs
ten percent better than the market when the market is up.
Worst Return – Within a selected date range (e.g., 5 years), the manager’s worst rate of return.
Atlantic Trust Private Wealth Management includes Atlantic Trust Company, a division of Invesco National Trust Company (a limited-purpose national trust company), and Stein Roe
Investment Counsel, Inc. (a registered investment adviser), both of which are wholly-owned subsidiaries of Atlantic Trust Group, Inc. This material is intended for informational purposes only
and is being offered to prospective or current clients of Atlantic Trust, should not be relied upon as the sole factor in an investment making decision and should not be construed a an offer to
buy or sell any financial instrument. If any offer of securities is made, it shall be made by the manager and/or distributor pursuant to a Private Placement Memorandum which contains
material information not contained herein. Under no circumstances should a prospective investor elect to invest in the securities without reviewing the terms of the Private Placement
Memorandum. In the event of any inconsistency between the information contained herein and the Private Placement Memorandum, the Private Placement Memorandum will govern. The
opinions expressed herein are those of Atlantic Trust and are subject to change without notice. To ensure compliance with requirements imposed by the IRS, we inform you that any U.S.
federal tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the
Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. Atlantic Trust does not provide legal advice, and the
information contained herein should only be used in consultation with your legal, accounting and tax advisers.
To the extent that information contained herein is derived from third-party sources, although we believe the sources to be reliable, we cannot guarantee their accuracy. As with all
investments there are associated risks. The opinions expressed herein are based on current market conditions and are subject to change without notice. Past performance is not indicative
of future results. Hedge funds and funds of hedge funds can be highly illiquid and may engage in leveraging and other speculative investment practices which may involve volatility of
returns and significant risk of loss, including the potential for loss of the principal invested. Hedge fund investments are not suitable for all investors. Hedge fund investing is intended for
experienced and sophisticated investors only who are willing to bear the high economic risks of the investment.
THIS DOCUMENT SHOULD BE ACCOMPANIED BY A PRIVATE PLACEMENT MEMORANDUM.
Investment Products Offered are Not FDIC-Insured, May Lose Value and are Not Bank Guaranteed.
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