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EQUITY STABILITY EUROPE REPORT AS OF END OF AUGUST 2013 NAV: 128% Inception date: 01.2010 Currency: EUR info@kategory.ch

FUND OBJECTIVES Equity Stability Europe is a quantitative market neutral strategy The aim is to generate revenue capturing the implied volatilities of international indices by selling and buying options using an algorithmic trading model with some active steering. Strengths of the strategy are its low volatility and low risk on the maximum drawdown.

NET PERFORMANCE 140% 130% 120%

Fund NAV, 127.89%

110% 100% 90% 80%

Eurostoxx50, 91.47%

70% 60% 50%

Fund NAV Performance

Eurostoxx50

1-MONTH

3-MONTH

6-MONTH

1-YEAR

YTD 2013

2012

2011

2010

Compartment (*)

0.48%

-0.52%

-1.12%

5.91%

1.66%

8.73%

7.43%

7.70%

Benchmark

1.64%

-2.08%

2.98%

11.12%

2.89%

13.79%

-17.05%

-5.81%

Over/under performance

-1.17%

1.56%

-4.10%

-5.21%

-1.22%

-5.06%

24.48%

13.50%

2013

Jan

Feb

Mar

Jun

Jul

Aug

Sep

Oct

Nov

Dec

YTD annual

2010

1.46%

1.09%

1.56%

-1.85% -0.91%

Apr

May

0.83%

0.96%

0.37%

0.70%

1.09%

0.69%

1.49%

7.70%

2011

0.64%

2.00%

2.55%

0.06%

4.71%

1.09%

1.47%

-15.2%

2.39%

2.87%

1.35%

4.94%

7.43%

2012

1.91%

1.70%

-0.16%

2.10%

3.03%

0.47%

0.02%

-4.58% -0.44%

3.10%

0.97%

0.51%

8.73%

Compartment 2013 (*)

1.53%

1.27%

2.53%

-0.19% -2.88% -0.29% -0.70%

0.48%

1.66%

Benchmark

2.54%

-2.57% -0.36%

3.35%

1.64%

2.89%

2.13%

-6.03%

2.52%

(*) Performance including transaction fees, excluding management fees

STATISTICS Average perf.

Average perf.

Max drawdown

Positive Negative Volatility

Sharpe (vs.

Sharpe (vs.

Duration

Average

months

Eurostoxx50)

Euribor1M)

(month)

leverage

12.37

8.75

2.5

250.00%

since inception

2013

since inception

Compartment

0.61%

0.22%

-15.37%

Benchmark

-0.08%

0.40%

-13.79%

77.27%

months 22.73%

2.94% 5.06%

MANAGER'S COMMENT Equity markets bumped back over the holidays and kept on bumping. There was light volume and high response, although short term, on news. After the what is now known as an unfortunately misunderstood Bernake when he started talking about tapering in June, we are now looking at all economic data with "tapering sunglasse"s. No it is not the latest brand, but they just inverse your opinion so that good economic news is bad news for the account of immediate tapering and vice versa. We have seen volatility coming down over july and august before jumping on Syria intervertion rumours or decision waiting. We stayed directionally quite short throughout the months of july and august as model wise the rebound during july was to exagerated. This position has cost us for the month of july but made us feel confortable during the Syria problems as short put positions were covered. Clearly lately the market waves had a to big amplitude for the paid volatility and we ended up more or less flat for the summer. This document is not an offer or a solicitation to purchase or sell any investment and is issued for information only. The investments described herein are not publicly distributed. This document is confidential and submitted to selected recipients only. It may not be reproduced nor passed to non-qualifying persons or to a non professional audience. Any U.S. person receiving this report and wishing to effect a transaction in any security discussed herein, must do so through a U.S. registered broker dealer. The investment described herein carries substantial risks and potential investors should have the requisite knowledge and experience to assess the characteristics and risks associated therewith. Accordingly, they are deemed to understand and accept the terms, conditions and risks associated therewith and are deemed to act for their own account, to have made their own independent decision and to declare that such transaction is appropriate or proper for them, based upon their own judgment and upon advice from such advisers as they have deemed necessary and which they are urged to consult. The advisor and the manager disclaim all liability to any party for all expenses, lost profits or indirect, punitive, special or consequential damages or losses, which may be incurred as a result of the information being inaccurate or incomplete in any way, and for any reason.


equity-stability-europe-2013-08