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Investment Opportunity
The 11 countries (Poland, Hungary, Czech, Estonia, Latvia, Lithuania, Slovakia, Romania, Bulgaria, Turkey, Croatia (Turkey and Croatia are the only 2 that are not current EU members)) applying to join the EU and subsequently EMU will experience significant convergence of key macro-economic indicators including lower inflation, interest rates and fiscal deficits. This should lead to a significant re-rating of their stock markets and currencies over the next several years.

Euro Convergence Fund
There are very few funds dedicated to the Euro Convergence theme. Our diversified Convergence Fund thus differentiates itself from most other Eastern European Funds, many of which are benchmarked against a regional MSCI benchmark and have typically more than 60% invested in Russian Equities.

Philosophy
To pursue a disciplined approach applying quantitative techniques, fundamental analysis and rigorous risk management. Return targets and risk parameters are precisely targeted.

Objectives
1) To outperform our in-house Convergence benchmark, market liquidity permitting.
2) To target an above-median Eastern European Equity peer group ranking

Risk Control
Target average tracking error:
Overall portfolio - 4 - 10%

Investment Team

Key Strengths

• Experienced Team - Highly experienced (average 13 years) and fully resourced team. The bulk of the global team has been together for over 5 years using the same investment process.
• Team Approach - A unique team structure ensures an improved quality of investment decision and minimal divergent performance between similar client accounts. Clients receive input from all members of the team not just individual Fund Managers.
• Investment Approach - Stock selection 67%, target country selection 33% of value added.
• Quantitative Input - We use a quantitative asset allocation model which ensures a disciplined approach to country selection. Judgmental overlay is then applied by the team to finalise asset allocation.
• Integrated Bond & Equity Teams - Combined resource adds value to the country allocation decision.
• Rigorous Risk Control - A risk budget is set for both country asset allocation and stock selection.

Benchmarks
There is no appropriate third party index available. Therefore, we maintain our own Euro Convergence Index based on GDP weights with a 25% Cap to ensure diversification.

Fees
Standard fee: 1.0%. Fees are negotiable depending on the size and nature of the mandate.

Minimum Size for segregated fund
US$ 25m

Emerging Markets Assets under Management
US$ 2.9bn (September 2008) assets either managed directly or on an advisory basis