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    Lof europe high conviction 30092012 Lof europe high conviction 30092012 Presentation Transcript

    • LO Funds - Europe High ConvictionInvest in leading european companies through an innovative approachEquities – EuropeOctober, 2012 © All rights reserved. Lombard Odier Investment Managers.
    • Team MARC BATAILLON, HARVARD MBA, FUND MANAGER - LONDON BUSINESS EXPERIENCE 2010 – to date Lombard Odier, Fund Manager of LOF Europe High Conviction and LOF 1798 Europe Equity Long/Short 2003 – 2010 Selectium, founder and CEO - Paris 2002 – 2003 LBO France - Paris 1999 – 2001 Transactive Solutions, founder and partner – Boston 1996 – 1999 International Data Group, French subsidiary CEO - Paris CYRIL MARQUAIRE, SFAF, CIIA, PORTFOLIO MANAGER – LONDON BUSINESS EXPERIENCE 2010 – to date Lombard Odier, Portfolio Manager of LOF Europe High Conviction and LOF 1798 Europe Equity Long/Short 2004 – 2010 Selectium, buy-side analyst- Paris 2000 – 2004 Crédit Lyonnais Securities, sell-side analyst – Lyon 1998 – 2000 Accenture, consultant - Paris PETER DIONISIO, MBA, PORTFOLIO MANAGER – LONDON BUSINESS EXPERIENCE 2011 – to date Lombard Odier, Portfolio Manager of LOF Europe High Conviction and LOF 1798 Europe Equity Long/Short 2008 – 2010 Merian Capital, partner and buy-side senior analyst - London 2005 – 2008 Morgan Stanley, sell-side analyst - London 2004 – 2005 MF Global, sell-side analyst – London 1999 – 2004 Merrill Lynch, sell-side analyst - London JULIEN DE BOURNET, INSEAD MBA, ANALYST - LONDON BUSINESS EXPERIENCE 2011 – to date Lombard Odier, Analyst for LOF Europe High Conviction and LOF 1798 Europe Equity Long/Short 2010 Jabre Capital, financial analyst - Geneva 2006 - 2008 IBM Global Business Services, consultant - Paris 2003 – 2006 Bouygues Telecom, project manager - Paris ARNAUD MALLET, CHIEF OPERATING OFFICER - LONDON BUSINESS EXPERIENCE 2010 – to date Lombard Odier, Operations Specialist for LOF Europe High Conviction and LOF 1798 Europe Equity Long/Short 2003 - 2010 Fincapital, head of execution and operations - Paris 2002 - 2003 Agon Alternative, risk arbitrage analyst - Paris 1997 – 2002 Wyser-Pratte & Co, risk arbitrage analyst & trading - New York Lombard Odier Investment Managers. 2
    • Performance since change of management team LOF EUROPE HIGH CONVICTION - FUND PERFORMANCE SINCE 15.11.2010* 30.09.2012 140 130 +23.69% LOF Europe High Conviction Benchmark** 120 110 +5.23% 100 90 80 70 Past performance is not a guarantee of future results * Div idend accumulated priv ate client share class, net performance in EUR ** MSCI Europe ND Lombard Odier Investment Managers. 3
    • Key investment beliefs1 2 3 4 5 6Europe’s sheer Europe is home to Structured Avoids businesses Does not invest in Stringent riskmarket size some best-in- investment whose future any investment control is key: 12makes it an class operators strategy through a development are revolving around risk factors andattractive region with worldwide tiered portfolio unpredictable the price of an exposuresfor investing in leadership construction (e.g., banks) underlying monitoredequities positions (Nestlé, focused on and/or balance commodity (oil, continuously SAP, LVMH…) performing sheet are difficult oil & services, through any cycle to penetrate (e.g. metal & mining) insurance) Lombard Odier Investment Managers. 4
    • Contents The case for European Equities Investment approach Investment process Performance & fund data Appendix Lombard Odier Investment Managers. 5
    • The case for European Equities Lombard Odier Investment Managers. 6
    • Why Europe? A large market whose sheer size makes it an unavoidable area when investing in equities CORE EUROPEAN MARKETS* USA CHINA 14 countries 1 country / 50 states 1 country / 22 provinces 380 million people 307 million people 1’338 million people USD 15 trillion in GDP USD 15 trillion in GDP USD 7 trillion in GDP An investable universe with heterogeneous dynamics, thus offering many opportunities to pick stocks and beat the index. Europe is home to some best-in-class operators with worldwide leadership positions. If you want emerging market exposure, Europe is a great way to invest in emerging market growth with Western-style management and shareholder friendliness.• *Population: Germany (82), France (64), UK (61), Italy (58), Spain (40), Netherlands (17), Portugal (11), Belgium (10), Sweden (9), Switzerland (8), Denmark (6), Finland (5), Norway (5), Ireland (4) Lombard Odier Investment Managers. 7
    • Investment approach Lombard Odier Investment Managers. 8
    • OverviewINVESTMENT UNIVERSE  Western European Equities excluding financials, oils, metal & miningOBJECTIVE  The portfolio is managed to beat the MSCI Europe index over the long term and not to track the index over the short termINVESTMENT APPROACH  High conviction and research-intensive approach targeting mispricings coupled with catalysts  Diversified and uncorrelated approach to investment opportunities – The book is built in 3 distinct categories so as to aggregate positions that will not correlate strongly with one another:  High-quality companies  Corporate event candidates  High growth companies  Does not invest in sectors difficult to analyze thoroughly ( e.g. banks, insurance, metal & mining, energy)KEY PORTFOLIO  Concentrated long-only portfolio of 30-40 stocksCHARACTERISTICS  Stringent risk control: 12 risk and exposure factors monitored continuously at stock and portfolio levels using internally developed tools  Positions equally-weighted, if possible, using liquidity as alternative criterion if we cannot Lombard Odier Investment Managers. 9
    • What don’t we do?SECTORS AND COUNTRIES COMPANIES PORTFOLIO Stocks listed outside of the  Companies in the midst of a  High concentration in any given European Economic Area significant transformational name (EEA)+Switzerland turnaround in operations  Long exposure to the market through Business models that are difficult to  Companies in financial distress index-replicating instruments analyze and whose future and/or massively leveraged equity developments are unpredictable plays  Hidden geographic risks (e.g. Banks) (e.g., disproportionate exposure to  Value traps when identifiable and/or EM or North American sales) Businesses whose balance sheets very illiquid securities and accounting rules are difficult to  Hidden Beta risks (e.g., penetrate (e.g Insurance)  Momentum trades crowded with disproportionate exposure to fast money investors (if identifiable) leveraged balance sheets) Any fundamental case requiring a view of the future oil price (e.g. Oil &  Significant/prevailing government Oil services) intervention in corporate governance, units sold or pricing Any fundamental case revolving around the price of an underlying commodity (e.g. Metals & Mining) Lombard Odier Investment Managers. 10
    • Investment process Lombard Odier Investment Managers. 11
    • Investable universe 1 2 3 High Quality Companies Corporate Event Opportunities High Growth Companies 0–100% of total assets 0 – 50% of total assets 0 – 50% of total assets Investable universe Investable universe Investable universe. c. 60-70 stocks c. 80-100 stocks c. 50-70 stocks  Largely acyclical companies  Take-over, creeping take-over or  Companies with above-average  Demonstrated pricing power vis-a-vis a well squeeze-out candidates revenue growth (absolute or sector- diversified customer base  Exceptional dividend and or break-up relative)  A dominant regional or worldwide investment cases  Main focus on structural growth (vs. competitive position  Fundamental risk is mitigated to some cyclical growth)  A significant competitive moat (brands, extent by the possibility/probability of an  Sources of growth: (i) geographic customer switching costs, scale, patents…) event exposure, (ii) sector dynamics,  Businesses range across the cyclical (iii) company-specific attributes  A highly profitable and/or cash generative business model spectrum  Examples: H&M, Synthes, Qiagen, SGS,  Examples: Chloride, Swedish Match, SSL, Millicom  Examples: Nestle, Dignity, Diageo, SAP, Fresenius Medical Care Betwin, SeLoger Target asset allocation and portfolio composition represent a portfolio construction goal. It is not representative of actual, complete nor accurate past, present or future portfolio holdings. The use of specific companies does not represent investment advice, they are used purely as examples to assist in the explanation of the investment process and they may or may not be held in portfolios. Lombard Odier Investment Managers. 12
    • How important is our macro view to our portfolio? Government intervention in 2008 - 2012 has made macro a required part of any stock-picking exercise Macro inputs are also a critical input to the portfolio construction processMICRO  MACRO  Active monitoring of pre-screened actionable  Analysis of general economic backdrop (GDP investable universes Portfolio growth, capital spending, inflation, interest rates…) Tracking of earnings development, likely  Allocation of capital to  Analysis of general government and/or central guidance revisions, profit warnings, quarterly the high-quality, event bank intervention in the economy and of the conference calls and company-specific news flow and growth tiers obstacles to supply and demand meeting freely in Update of valuation models, adjustment to net  Single names any given sector debt and enterprise value calculations  Directional exposure  Tracking of money flows, market sentiment and Validation of investment cases through conference market volatility attendance, 1-on-1 meetings with management  Tracking of a large number of macro indicators and customer, supplier or industry consultant with potential microeconomic read-across interviews – Association of American Railroads statistics Refinement of investment cases (quantitative and – Port of Rotterdam volumes qualitative analysis) with simple business drivers to – British Retail Consortium l-f-l trends (UK) be monitored, price targets, upside & downside – Halifax house price index (UK) risks – Chambre des Notaires house prices (France) – ACEA auto sales (Europe)… Lombard Odier Investment Managers. 13
    • Twelve risk factors that we monitor Exposures – Gross exposure: 85-100% – Directional exposure: Euro and Beta-adjusted net exposures are capped at 100% of NAV – Single name exposure: max 7% – Sector exposure: max 25% – Country exposure: max 35% – Statistical diversification: if possible, investments are equally weighted with at least 25 names in the book Fundamental risks – Exposure of underlying revenues to US-dollar geographies and in emerging markets – Exposure to balance sheet leverage (to track the fund’s risk to covenant breach – metric: net debt / EBITDA) – Exposure to equity leverage (to track hidden Beta risk – metric: net debt as a % of enterprise value) – Exposure to market capitalization (small-mid-large) Trading risks – Reversion to the mean: single name exposure is managed to optimize the proportion of our funds in companies that have outperformed and underperformed their local markets within the past 1, 3 and 6 months – Liquidity: exposure to positions with sub-optimal liquidity is shunned or actively managed Lombard Odier Investment Managers. 14
    • Performance & fund data Lombard Odier Investment Managers. 15
    • LO Funds – Europe High ConvictionLOF EUROPE HIGH CONVICTION - FUND PERFORMANCE SINCE INCEPTION* 30.09.2012 250 200 LOF Europe High Conviction Benchmark** 150 100 50 0LOF EUROPE HIGH CONVICTION - FUND DATA & HISTORICAL PERFORMANCE* 30.09.2012 Fund Size (mn): EUR 303 Equity Pos.: 36 Volatility***: 13.0% T.E.***: 6.8% Information Ratio***: 0.37 Sharpe Ratio***: 0.65 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Fund Bench** 2012 3.45% 5.80% 1.86% 0.30% -3.28% 2.83% 5.02% 0.65% 0.83% 18.54% 12.32% 2011 0.01% 0.96% -0.91% 3.50% 2.26% -2.18% 1.14% -4.90% -4.70% 5.70% -0.23% 0.80% 0.95% -8.09% 2010 -2.20% -0.90% 9.18% -1.28% -6.97% -2.99% 6.64% -2.63% 2.97% 1.20% 0.63% 4.32% 7.09% 11.10% 2009 -2.72% -8.15% 4.46% 12.98% 4.37% -3.12% 8.68% 5.96% 4.89% -6.10% 1.25% 6.89% 30.87% 31.59% 2008 -12.82% 0.94% -7.34% 7.02% 1.97% -12.14% 2.44% 0.46% -13.48% -15.30% -0.95% -1.48% -42.47% -43.64%Past performance is not a guarantee of future results Since launch 48.18% 39.69%* Div idend accumulated priv ate client share class, net performance in EUR Inception date 19.12.1997** MSCI Europe ND since 30.06.2005, prev iously MSCI Europe and FT Europe*** Last three y ears, monthly basis Lombard Odier Investment Managers. 16
    • Portfolio composition Lombard Odier Investment Managers. 17
    • LOF Europe High ConvictionLOF EUROPE HIGH CONVICTION - PRODUCT DETAILSInception Date 19.12.97 (change of brief and management team on 15.11.2010)Legal Structure SICAV - UCITS CompliantCustodian Bank CACEIS Bank LuxembourgCentral Administration CACEIS Bank LuxembourgInvestment Terms Class I Class P Management fee 0.75% 0.75% Distribution fee - 0.75% Performance fee 15% (rel. HWM) 15% (rel. HWM) Liquidity Daily Daily Subs. & redemp. deadline T-1, 15:00 CET T-1, 15:00 CET Subs. & redemp. payment date T+3 T+3 Redemption penalties - - Minimum investment CHF 1000000 (or equivalent) EUR 3000 (or equivalent) Reference currency EUR EURISIN Accumulating Distributing Accumulating Distributing EUR share class LU0210001326 LU0049412769 LU0049505935 Lombard Odier Investment Managers. 18
    • Appendix Lombard Odier Investment Managers. 19
    • Selectium Opportunities Fund Limited – Track recordFUND CUMULATIVE / MONTHLY RETURNS OVER INVESTMENT PERIOD (OCT 05 TO JUN 09) YTD JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC SELECTIUM MSCI EUROPE 2005 -1.25% 0.33% 2.56% 1.61% 4.21% 2006 5.31% 4.33% 5.41% 3.50% -2.68% -2.95% -1.28% 2.81% 1.91% 2.28% 1.79% 2.88% 25.42% 15.94% 2007 4.38% 0.56% 2.87% 1.96% 2.65% -0.61% -1.56% -2.56% -0.46% 3.32% -2.69% -0.54% 7.24% 3.34% 2008 -7.95% 0.40% -0.98% 0.34% 1.37% 1.23% -2.27% 4.38% -2.44% 1.42% 0.20% 0.16% -4.55% -40.93% 2009 0.21% 0.04% 1.41% 0.21% -0.06% 0.95% 2.78% -0.40%FUND KEY STATISTICS OVER INVESTMENT PERIOD (OCT 05 TO JUN 09) SELECTIUM OPPORTUNITIES MSCI EUROPEReturn ITD 34.1% -26.5%Ann. performance 8.5% -8.3%Number of up months 69% 53%Number of down months 31% 47%Maximum monthly gain 5.4% 12.0%Maximum monthly loss -8.0% -13.6%Correlation to MSCI Europe 0.50The data presented herein relate to Selectium Opportunities Fund Limited (the "Fund"), and was audited by PWC. The fund was an exempted company with limited liability incorporated in the Cayman Islands on 24 August 2005with the objective to achieve capital appreciation primarily through focused long-only investments in the equities of European companies in the small-, mid- and large-cap segments. The fund was administrated by HSBC Securities.The Fund began voluntary liquidation in August 2009. The Fund was NOT part of the Lombard Odier Group. Lombard Odier Investment Managers. 20
    • Important informationSelectium Opportunties Fund Ltd - Important information Company within the meaning of EU Directive 85/611/EC, as amended.The data presented herein relate to Selectium Opportunities Fund Limited (the "Fund"), an exempted company with limited Neither this document nor any part of it shall form the basis of, or be relied on in connection with, any contract to purchaseliability incorporated in the Cayman Islands on 24 August 2005 with the objective to achieve capital appreciation primarily or subscription for the Fund’s shares. Any such acquisition may only be made on the basis of the official documents of thethrough focused long-only investments in the equities of European companies in the small-, mid- and large-cap segments. Fund each in their final form. The articles of association, the prospectus, the simplified prospectus, the subscription formThe Fund began voluntary liquidation in August 2009. The Fund was NOT part of the Lombard Odier Group. and the most recent annual and semi-annual reports are the only official offering documents of the Fund’s shares (theThe figures presented herein are the result of calculations based on data collected by Marc Bataillon during his mandate “Offering Documents”). They are available on http//:funds.lombardodier.com or can be requested free of charge at theas director of the Fund as from inception of the Fund until its commercial closure. The information and analysis contained registered office of the Fund or of the Management Company or from the local appointed distributors of the Fund asherein are based on sources believed to be reliable. However, no entity of the Lombard Odier Group guarantees the mentioned hereafter. Local information and local representatives Austria. Representative: Erste Bank dertimeliness, accuracy, or completeness of the information contained in this document, nor does it accept any liability for any österreichischen Sparkassen AG, Graben 21, A-1010 Wien - France. Offering Documents of the Fund(s) can be found atloss or damage resulting from its use. These data are not directly comparable to the past or future performance of any CACEIS Bank, place Valhubert 1-3, F-75013 Paris -Germany. Representative: DekaBank Deutsche Girozentrale, MainzerLombard Odier fund. Landstraße 16, D-60325 Frankfurt am Main - Liechtenstein. Representative: Verwaltungs- und Privat-BankPast performance is not a guarantee of future results. Where the fund is denominated in a currency other than an Aktiengesellschaft, Aeulestrasse 6, LI-9490 Vaduz - Netherlands. The Fund has been registered with the Netherlandsinvestors base currency, changes in the rate of exchange may have an adverse effect on price and income. The Authority for the Financial Markets under the Act on the Financial Supervision. Representative: Lombard Odier Darierperformance data does take account the commissions and costs incurred on the issue and redemption of shares/units. Hentsch & Cie (Nederland) N.V., Weteringschans 109, 1017 SB Amsterdam (telephone: +31 20 522 0 522) - Switzerland.Performance shown net of fees and expenses from the beginning of the reference period reflects the performance of the B Representative: Lombard Odier Funds (Switzerland) SA, 6 av. des Morgines, 1213 Petit-Lancy; Paying agent: Lombardclass (1.5% management fee, 20% performance fee); all performance figures reflect the reinvestment of interest and Odier Darier Hentsch & Cie, 11 rue de la Corraterie, CH-1204 Geneva. NOTICE TO RESIDENTS OF THE UNITEDdividends; monthly performance figures were calculated by the Funds administrator, HSBC Securities, and annual results KINGDOM. The Fund is a collective investment scheme for the purposes of the United Kingdoms Financial Services andwere audited by PricewaterhouseCoopers. Markets Act 2000 ("FSMA"). It is not an authorised unit trust scheme, an authorised open-ended investment company or aAny indices cited herein are provided only as examples of general market performance. No index is directly comparable to recognised scheme for the purposes of s238 FSMA. The communication of this document or any invitation or inducementthe past or future performance of a fund. It should not be assumed that the Fund has invested in any specific securities in the United Kingdom to participate in the Fund or its shares is accordingly restricted by law. This document has not beenthat comprise any index, nor should it be understood to mean that there is a correlation between the Fund’s returns and approved by an authorised person (as defined in FSMA) for the purposes of s21(2)(b) FSMA. Most if not all of theany index returns. protections provided by the United Kingdom regulatory structure will not apply to an investment in the Fund. Investors mayThis document does not contain personalized recommendations or advice and is not intended to substitute any not have the right to complain directly to the United Kingdom Financial Ombudsman Service and may not be protected byprofessional advice on investment in financial products. Before entering into any transaction, an investor should consider the Financial Services Compensation Scheme in the United Kingdom.carefully the suitability of a transaction to his/her particular circumstances and, where necessary, obtain independent This document may only be communicated or caused to be communicated in the UK to: (1) persons authorised to carry onprofessional advice in respect of risks, as well as any legal, regulatory, credit, tax, and accounting consequences. a regulated activity ("Authorised Persons") under FSMA; (2) persons otherwise having professional experience in mattersImportant information relating to investments and qualifying as Investment Professionals under Article 19 of the Financial Services and MarketsThis document is issued by Lombard Odier Asset Management (Europe) Limited (hereinafter LOAM). LOAM is a private Act 2000 (Financial Promotion) Order 2005, as amended (the "Order"); (3) persons qualifying as High Net Worth Personslimited company incorporated in England and Wales with registered number 07099556, having its registered office at under Article 49 of the Order; or (4) to any other person to whom this document may otherwise lawfully be communicatedQueensberry House, 3 Old Burlington Street, London, United Kingdom, W1S 3AB. LOAM is authorised and regulated by or caused to be communicated ("Relevant Persons"). No approved prospectus relating to the matters in this documentthe Financial Services Authority (the "FSA") and is entered on the FSA register with registration number 515393. LOAM is has been made available to the public in the UK and, accordingly, shares in the Fund may not be, and will not be, offeredpart of the Lombard Odier Investment Managers Holding SA group (hereinafter LOIM). in the UK except in circumstances which will not result in there being an offer to the public in the UK within the meaning ofLO Funds (hereinafter the “Fund”) is a Luxembourg investment company with variable capital (SICAV). The Fund is FSMA. This document may only be communicated or caused to be communicated in the UK by authorised persons to: (1)authorised and regulated by the Luxembourg Supervisory Authority of the Financial Sector (CSSF) as a UCITS within the persons qualifying as Investment Professionals under Article 14 of the Financial Services and Markets Act 2000meaning of EU Directive 85/611/EC, as amended. The management company of the Fund is Lombard Odier Funds (Promotion of Collective Investment Schemes) (Exemptions) Order 2001; (2) persons qualifying as High Net Worth(Europe) S.A. (hereinafter the “Management Company”), a Luxembourg based public limited company (SA), having its Persons under Article 22 of that Order; (3) persons described in and in circumstances permitted by Chapter 4.12 of theregistered office at 5, Allée Scheffer, L-2520 Luxembourg, authorized and regulated by the CSSF as a Management Conduct Of Business Rules of the UK Financial Services Authority; or (4) any other person to whom this document may otherwise lawfully be communicated or caused to be communicated ("Relevant Persons"). Neither this document nor the shares in the Fund are or will be available to categories of persons in the UK other than Relevant Persons and no one falling outside such categories is entitled to rely on, and they must not act on, any information in this document. The communication of this document to any person in the UK other than Relevant Persons is unauthorised and may contravene FSMA. Any person who is in any doubt about the investment to which this document relates should consult an Authorised Person specialising in advising on investments of this kind. Lombard Odier Investment Managers. 21
    • LOIM disclaimer & Legal NoticeThis document is issued by Lombard Odier Asset Management (Europe) Limited (hereinafter LOAM). LOAM is a private NOTICE TO RESIDENTS OF THE UNITED KINGDOMlimited company incorporated in England and Wales with registered number 07099556, having its registered office at The Fund is a Recognised Scheme in the United Kingdom under the Financial Services & Markets Act 2000. PotentialQueensberry House, 3 Old Burlington Street, London, United Kingdom, W1S 3AB. LOAM is authorised and regulated by investors in the United Kingdom are advised that none of the protections afforded by the United Kingdom regulatorythe Financial Services Authority (the "FSA") and is entered on the FSA register with registration number 515393. LOAM is system will apply to an investment in LO Funds and that compensation will not generally be available under the Financialpart of the Lombard Odier Investment Managers Holding SA group (hereinafter LOIM).LOIM is a trade name. Services Compensation Scheme. This document does not itself constitute an offer to provide discretionary or non-The fund mentioned in this document (hereinafter the “Fund”) is a Luxembourg investment company with variable capital discretionary investment management or advisory services, otherwise than pursuant to an agreement in compliance with(SICAV). The Fund is authorised and regulated by the Luxembourg Supervisory Authority of the Financial Sector (CSSF) applicable laws, rules and regulations. Representative: Lombard Odier Asset Management (Europe) Limited, Queensberryas a UCITS within the meaning of EU Directive 2009/65/EC, as amended. The management company of the Fund is House, 3 Old Burlington Street, London W1S3AB, which has approved this document for issuance in the UK toLombard Odier Funds (Europe) S.A. (hereinafter the “Management Company”), a Luxembourg based public limited professional clients or eligible counterparties and is authorised and regulated by the Financial Services Authority. Ancompany (SA), having its registered office at 5, Allée Scheffer, L-2520 Luxembourg, authorized and regulated by the investment in the Fund is not suitable for all investors. Making an investment in a Fund is speculative. There can be noCSSF as a Management Company within the meaning of EU Directive 2009/65/EC, as amended. The Fund is only assurance that the Funds investment objective will be achieved or that there will be a return on capital. Past or estimatedregistered for public offering in certain jurisdictions. This document is not a recommendation to subscribe to and does not performance is not necessarily indicative of future results and not assurance can be made that profits will be achieved orconstitute an offer to sell or a solicitation or an offer to buy the Fund’s shares nor shall there be any sale of the Fund’s that substantial losses will not be incurred. This document does not contain personalized recommendations or advice andshares in any jurisdiction in which such offer, solicitation or sale would be unlawful. Consequently, the offering of the is not intended to substitute any professional advice on investment in financial products. Before making an investment inFund’s shares may be restricted in certain jurisdictions. Prospective investors must inform themselves of, and observe, the Fund, an investor should read the entire Offering Documents, and in particular the risk factors pertaining to ansuch restrictions, including legal, tax, foreign exchange or other restrictions in their relevant jurisdictions. Neither this investment in the Fund, consider carefully the suitability of such investment to his/her particular circumstances and, wheredocument nor any part of it shall form the basis of, or be relied on in connection with, any contract to purchase or necessary, obtain independent professional advice in respect of risks, as well as any legal, regulatory, credit, tax, andsubscription for the Fund’s shares. Any such acquisition may only be made on the basis of the official documents of the accounting consequences. This document is the property of LOIM and is addressed to its recipient exclusively for theirFund each in their final form. The articles of association, the prospectus, the simplified prospectus, the subscription form personal use. It may not be reproduced (in whole or in part), transmitted, modified, or used for any other purpose withoutand the most recent annual and semi-annual reports are the only official offering documents of the Fund’s shares (the the prior written permission of LOIM. It is not intended for distribution, publication, or use in any jurisdiction where such“Offering Documents”). They are available on http//:funds.lombardodier.com or can be requested free of charge at the distribution, publication, or use would be unlawful. This document contains the opinions of LOIM, as at the date of issue.registered office of the Fund or of the Management Company, from the distributors of the Fund or from the local The information and analysis contained herein are based on sources believed to be reliable. However, LOIM does notrepresentatives as mentioned below. guarantee the timeliness, accuracy, or completeness of the information contained in this document, nor does it accept anyAustria. Supervisory Authority: Finanzmarktaufsicht (FMA), Representative: Erste Bank der österreichischen Sparkassen liability for any loss or damage resulting from its use. All information and opinions as well as the prices indicated mayAG, Graben 21, A-1010 Wien - Belgium. Supervisory Authority: Autorité des services et marchés financiers (FSMA), change without notice. The contents of this document are intended for persons who are sophisticated investmentRepresentative: Fastnet Belgium S.A.,Avenue du Port 86C, b320, 1000 Brussels - France. Supervisory Authority: Autorité professionals and who are either authorised or regulated to operate in the financial markets or persons who have beendes marchés financiers (AMF), Representative: CACEIS Bank, place Valhubert 1-3, F-75013 Paris - Germany. vetted by LOIM as having the expertise, experience and knowledge of the investment matters set out in this documentSupervisory Authority: Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin), Representative: DekaBank Deutsche and in respect of whom LOIM has received an assurance that they are capable of making their own investment decisionsGirozentrale, Mainzer Landstraße 16, D-60325 Frankfurt am Main - Italy. Supervisory Authority: Banca d’Italia (BOI), and understanding the risks involved in making investments of the type included in this document or other persons thatPaying Agents: Société Générale Securities Services S.p.A., Via Benigno Crespi, 19/A - MAC 2, 20159 Milano, State LOIM has expressly confirmed as being appropriate recipients of this document. If you are not a person falling within theStreet Bank S.p.A. Via Col Moschin 16, 20136 Milano, Banca Sella Holding S.p.A., Via Italia 2, 13900 Biella, Allfunds above categories you are kindly asked to either return this document to LOIM or to destroy it and are expressly warnedBank S.A., filiale italianaVia Santa Margherita 7, 20121 Milano, - Liechtenstein. Supervisory Authority: Finanzmarktaufsicht that you must not rely upon its contents or have regard to any of the matters set out in this document in relation toLiechtenstein ("FMA"), Representative: Verwaltungs- und Privat-Bank Aktiengesellschaft, Aeulestrasse 6, LI-9490 Vaduz - investment matters and must not transmit this document to any other person. Neither this document nor any copy thereofNetherlands. Supervisory Authority: Autoriteit Financiële Markten (AFM). Representative: Lombard Odier Darier Hentsch & may be sent, taken into, or distributed in the United States of America, any of its territories or possessions or areas subjectCie (Nederland) N.V., Weteringschans 109, 1017 SB Amsterdam (telephone: +31 20 522 0 522) - Spain. Supervisory to its jurisdiction, or to or for the benefit of a United States Person. For this purpose, the term "United States Person" shallAuthority: Comisión Nacional del Mercado de Valores (CNMV). Representative: Allfunds Bank S.A. C/Nuria, 57 Madrid - mean any citizen, national or resident of the United States of America, partnership organized or existing in any state,Switzerland. Supervisory Authority: FINMA (Autorité fédérale de surveillance des marchés financiers), Representative: territory or possession of the United States of America, a corporation organized under the laws of the United States or ofLombard Odier Asset Management (Switzerland) SA, 6 av. des Morgines, 1213 Petit-Lancy; Paying agent: Lombard Odier any state, territory or possession thereof, or any estate or trust that is subject to United States Federal income taxDarier Hentsch & Cie, 11 rue de la Corraterie, CH-1204 Geneva. UK. Supervisory Authority: Financial Services Authority regardless of the source of its income.(FSA), Representative: Lombard Odier Asset Management (Europe) Limited, Queensberry House, 3 Old Burlington Street,London W1S3AB, which has approved this document for issuance in the UK to professional clients or eligiblecounterparties and is authorised and regulated by the Financial Services Authority. Lombard Odier Investment Managers. 22
    • LOIM disclaimer & Legal NoticePast performance is not a guarantee of future results. Where the fund is denominated in a currency other than aninvestors base currency, changes in the rate of exchange may have an adverse effect on price and income. Allperformance figures reflect the reinvestment of interest and dividends and do not take account the commissions and costsincurred on the issue and redemption of shares/units; performance figures are estimated and unaudited. Net performanceshows the performance net of fees and expenses for the relevant fund/share class over the reference period. Source ofthe figures: Unless otherwise stated, figures are prepared by LOIM. Any benchmarks/indices cited herein are provided forinformation purposes only. No benchmark/index is directly comparable to the investment objectives, strategy or universeof a fund. The performance of a benchmark shall not be indicative of past or future performance of any fund. It should notbe assumed that the relevant fund will invest in any specific securities that comprise any index, nor should it beunderstood to mean that there is a correlation between such fund’s returns and any index returns. The portfolioinformation provided in this document is for illustrative purposes only and does not purport to be recommendation of aninvestment in, or a comprehensive statement of all of the factors or considerations which may be relevant to an investmentin, the referenced securities. They illustrate the investment process undertaken by the manager in respect of a certaintype of investment, but may not be representative of the Funds past or future portfolio of investments as a whole and itshould be understood that they will not of themselves be sufficient to give a clear and balanced view of the investmentprocess undertaken by the manager or of the composition of the investment portfolio of the Fund. As the case my be,further information regarding the calculation methodology and the contribution of each holding in the representativeaccount to the overall account’s performance can be obtained by the Fund or the Management Company.© 2011 Lombard Odier Investment Managers – all rights reserved Lombard Odier Investment Managers. 23