Jeremy Smeeton Managing Director Global Asset Allocation Limited GAA Investment Funds Limited
Jeremy Smeeton Managing Director Global Asset Allocation Limited GAA Investment Funds Limited 25 May 2009
Jeremy Smeeton Managing Director
Jeremy Smeeton Managing Director Quant funds
Jeremy Smeeton Managing Director Quant funds GAA USD Global ‘Q’ Fund
<ul><li>GAA Group </li></ul><ul><li>Global Asset Allocation Ltd, GAA Investment Funds Ltd, GAA Direct Ltd, GAA Marketing L...
<ul><li>GAA Group </li></ul><ul><li>Global Asset Allocation Ltd, GAA Investment Funds Ltd, GAA Direct Ltd, GAA Marketing L...
<ul><li>GAA Group </li></ul><ul><li>Global Asset Allocation Ltd, GAA Investment Funds Ltd, GAA Direct Ltd, GAA Marketing L...
<ul><li>GAA Group </li></ul><ul><li>Global Asset Allocation Ltd, GAA Investment Funds Ltd, GAA Direct Ltd, GAA Marketing L...
<ul><li>GAA Group </li></ul><ul><li>Global Asset Allocation Ltd, GAA Investment Funds Ltd, GAA Direct Ltd, GAA Marketing L...
<ul><li>Current Investor Profile </li></ul><ul><ul><li>78%  of funds raised from  24  insurance companies, banks and trust...
Current Investor Profile As of 1 May 2009, 27 separate ‘platform providers’ had approved the purchase of GAA Funds
Where’s Bermuda?
Where’s Bermuda? <ul><li>Situated 774 miles of east coast of United States </li></ul><ul><li>Stable political and economic...
 
quant  [ kwont ] noun   ( informal ) X Mary Quant?
quant  [ kwont ] noun   ( informal )   a highly paid computer specialist with a degree in a quantitative science, employed...
 
quant fund management Quant managers use complex mathematical computer models developed by scientists & academics to ident...
quant fund management Quant managers use complex mathematical computer models developed by scientists & academics to ident...
quant fund management Quant managers use complex mathematical computer models developed by scientists & academics to ident...
 
moore’s law /morz law/ prov.   The observation that the logic density of  silicon integrated circuits  has closely followe...
moore’s law /morz law/ prov.   The observation that the logic density of silicon integrated circuits has closely followed ...
moore’s law /morz law/ prov.   The observation that the logic density of silicon integrated circuits has closely followed ...
 
 
 
INVESTMENT ISSUES
INVESTMENT ISSUES <ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchas...
<ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchase? </li></ul><ul><...
<ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchase? </li></ul><ul><...
<ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchase? </li></ul><ul><...
<ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchase? </li></ul><ul><...
 
INVESTMENT ISSUES <ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchas...
INVESTMENT ISSUES <ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchas...
INVESTMENT ISSUES <ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchas...
<ul><li>How often should a Portfolio be REBALANCED? </li></ul>INVESTMENT ISSUES
<ul><li>How often should a Portfolio be REBALANCED? </li></ul><ul><li>The Solution </li></ul><ul><ul><li>GAA utilises a  f...
<ul><li>How often should a Portfolio be REBALANCED? </li></ul><ul><li>The Solution </li></ul><ul><ul><li>GAA utilises a fo...
<ul><li>How often should a Portfolio be REBALANCED? </li></ul><ul><li>The Solution </li></ul><ul><ul><li>GAA utilises a fo...
<ul><li>Don’t investors deserve HANDS ON discretionary management? </li></ul>INVESTMENT ISSUES
<ul><li>Don’t investors deserve HANDS ON discretionary management? </li></ul><ul><li>The Solution </li></ul><ul><li>Size o...
<ul><li>Don’t investors deserve HANDS ON discretionary management? </li></ul><ul><li>The Solution </li></ul><ul><li>Size o...
<ul><li>Don’t investors deserve HANDS ON discretionary management? </li></ul><ul><li>The Solution </li></ul><ul><li>Size o...
<ul><li>Don’t investors deserve HANDS ON discretionary management? </li></ul><ul><li>The Solution </li></ul><ul><li>GAA  h...
<ul><li>Don’t investors deserve some PROTECTION against falling markets? </li></ul>INVESTMENT ISSUES
<ul><li>Don’t investors deserve some PROTECTION against falling markets? </li></ul><ul><ul><li>The Solution </li></ul></ul...
<ul><ul><li>Data input </li></ul></ul>
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>The Fund’s underlying ‘quant’ model analyses  ALL  relevant data availab...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>The Fund’s underlying ‘quant’ model analyses ALL relevant data available...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>The Fund’s underlying ‘quant’ model analyses ALL relevant data available...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>The costs inherent in such a programme are significant: </li></ul></ul>
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>The costs inherent in such a programme are significant: </li></ul></ul><...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>The costs inherent in such a programme are significant: </li></ul></ul><...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>The costs inherent in such a programme are significant: </li></ul></ul><...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul>
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Only mid to large cap stocks are se...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Only mid to large cap stocks are se...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
GAA USD Global ‘Q’ Fund:  Asset Allocation @ May 2009
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
<ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </l...
<ul><ul><li>Dynamic stock selection process  in more detail </li></ul></ul><ul><ul><li>Momentum factors </li></ul></ul><ul...
<ul><ul><li>Dynamic stock selection process  in more detail </li></ul></ul><ul><ul><li>Momentum factors </li></ul></ul><ul...
<ul><ul><li>Dynamic stock selection process  in more detail </li></ul></ul><ul><ul><li>Valuation factors </li></ul></ul><u...
<ul><ul><li>Dynamic stock selection process  in more detail </li></ul></ul><ul><ul><li>Valuation factors </li></ul></ul><u...
<ul><ul><li>Dynamic stock selection process  in more detail </li></ul></ul><ul><ul><li>Complete table with all factors in ...
<ul><ul><li>Dynamic stock selection process  in more detail </li></ul></ul><ul><ul><li>Factor weighting allocation process...
<ul><ul><li>Dynamic stock selection process  in more detail </li></ul></ul><ul><ul><li>Factor weighting allocation process...
<ul><ul><li>Dynamic stock selection process  in more detail </li></ul></ul><ul><ul><li>Factor weighting allocation process...
<ul><ul><li>Dynamic stock selection process  in more detail </li></ul></ul>
<ul><ul><li>Dynamic stock selection process  in more detail </li></ul></ul><ul><ul><li>Factor weighting allocation process...
<ul><ul><li>Dynamic stock selection process  in more detail </li></ul></ul>
<ul><ul><li>Dynamic stock selection process  in more detail </li></ul></ul><ul><ul><li>The ‘Quant’ model in action – an ac...
<ul><ul><li>Dynamic stock selection process  in more detail </li></ul></ul><ul><ul><li>The Quant model in action – an actu...
<ul><ul><li>Dynamic hedging facility  in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse m...
<ul><ul><li>Dynamic hedging facility  in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse m...
<ul><ul><li>Dynamic hedging facility  in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse m...
<ul><ul><li>Dynamic hedging facility  in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse m...
<ul><ul><li>Dynamic hedging facility  in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse m...
<ul><ul><li>Dynamic hedging facility  in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse m...
<ul><ul><li>Dynamic hedging facility  in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse m...
The Result?
Returns which have consistently beaten all major global stock markets…
NB Uncompounded figures used in this back tested graph are proforma and net of all management fees 98 winning months out o...
NB Uncompounded figures used in this back tested graph are proforma and net of all management fees … and significant out p...
The statistics speak for themselves… NB Uncompounded figures used in this back tested graph are proforma and net of all ma...
NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launc...
NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launc...
NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launc...
NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launc...
How has ‘Q’ Fund compared with the MSCI World Index? MSCI ‘ Q’ YEAR
How has ‘Q’ Fund compared with the MSCI World Index? +7.56% MSCI 2005 ‘ Q’ YEAR
How has ‘Q’ Fund compared with the MSCI World Index? +17.95% +7.56% MSCI 2006 2005 ‘ Q’ YEAR
How has ‘Q’ Fund compared with the MSCI World Index? +7.09% 2007 +17.95% +7.56% MSCI 2006 2005 ‘ Q’ YEAR
How has ‘Q’ Fund compared with the MSCI World Index? +7.09% 2007 -42.08% +17.95% +7.56% MSCI 2008 2006 2005 ‘ Q’ YEAR
How has ‘Q’ Fund compared with the MSCI World Index? +7.09% 2007 -42.08% +17.95% +7.56% MSCI 2008 2006 +20.78% 2005 ‘ Q’ Y...
How has ‘Q’ Fund compared with the MSCI World Index? +7.09% 2007 -42.08% +17.95% +7.56% MSCI 2008 +17.72% 2006 +20.78% 200...
How has ‘Q’ Fund compared with the MSCI World Index? +33.22% +7.09% 2007 -42.08% +17.95% +7.56% MSCI 2008 +17.72% 2006 +20...
How has ‘Q’ Fund compared with the MSCI World Index? +33.22% +7.09% 2007 -42.08% +17.95% +7.56% MSCI -1.90% 2008 +17.72% 2...
Total returns compared 1 May ’04 – 1 May ‘09 ‘ Q’ MSCI
Total returns compared 1 May ’04 – 1 May ‘09 -14.27% ‘ Q’ MSCI
Total returns compared 1 May ’04 – 1 May ‘09 +110.37% -14.27% ‘ Q’ MSCI
NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launc...
NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launc...
NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launc...
41 out of 49 x 12 month rolling returns have been positive
41 out of 49 x 12 month rolling returns have been positive
41 out of 49 x 12 month rolling returns have been positive BEST  12 month rolling return since launch:  +60.24% vs +22.28%...
<ul><li>Corporate Strength </li></ul><ul><li>Fund : GAA USD Global ‘Q’ Fund </li></ul><ul><li>Issued by :  GAA Investment ...
<ul><li>Key Features of GAA USD Global ‘Q’ Fund </li></ul><ul><li>Excellent  performance:  +110.37%  May 2004 – May 2009 <...
 
Jeremy Smeeton Managing Director Global Asset Allocation Limited GAA Investment Funds Limited  THANK YOU!
Jeremy Smeeton Managing Director Global Asset Allocation Limited GAA Investment Funds Limited  THANK YOU!
<ul><li>This presentation does not constitute investment advice specific to any one individual investor  and is not an off...
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Powerpoint Presentation - May 09

  1. 1. Jeremy Smeeton Managing Director Global Asset Allocation Limited GAA Investment Funds Limited
  2. 2. Jeremy Smeeton Managing Director Global Asset Allocation Limited GAA Investment Funds Limited 25 May 2009
  3. 3. Jeremy Smeeton Managing Director
  4. 4. Jeremy Smeeton Managing Director Quant funds
  5. 5. Jeremy Smeeton Managing Director Quant funds GAA USD Global ‘Q’ Fund
  6. 6. <ul><li>GAA Group </li></ul><ul><li>Global Asset Allocation Ltd, GAA Investment Funds Ltd, GAA Direct Ltd, GAA Marketing Ltd, GAA Singapore </li></ul><ul><li>International Fund Management , Trust and Advisory Group </li></ul>
  7. 7. <ul><li>GAA Group </li></ul><ul><li>Global Asset Allocation Ltd, GAA Investment Funds Ltd, GAA Direct Ltd, GAA Marketing Ltd, GAA Singapore </li></ul><ul><li>International Fund Management, Trust and Advisory Group </li></ul><ul><li>Regulated in Bermuda by BMA (GAAL & GAAIFL) </li></ul>
  8. 8. <ul><li>GAA Group </li></ul><ul><li>Global Asset Allocation Ltd, GAA Investment Funds Ltd, GAA Direct Ltd, GAA Marketing Ltd, GAA Singapore </li></ul><ul><li>International Fund Management, Trust and Advisory Group </li></ul><ul><li>Regulated in Bermuda by BMA (GAAL & GAAIFL) </li></ul><ul><li>Regulated in Malaysia by LOFSA (GAAD) </li></ul>
  9. 9. <ul><li>GAA Group </li></ul><ul><li>Global Asset Allocation Ltd, GAA Investment Funds Ltd, GAA Direct Ltd, GAA Marketing Ltd, GAA Singapore </li></ul><ul><li>International Fund Management, Trust and Advisory Group </li></ul><ul><li>Regulated in Bermuda by BMA (GAAL & GAAIFL) </li></ul><ul><li>Regulated in Malaysia by LOFSA (GAAD) </li></ul><ul><li>Regulated in Singapore by MAS (GAAS) </li></ul>
  10. 10. <ul><li>GAA Group </li></ul><ul><li>Global Asset Allocation Ltd, GAA Investment Funds Ltd, GAA Direct Ltd, GAA Marketing Ltd, GAA Singapore </li></ul><ul><li>International Fund Management, Trust and Advisory Group </li></ul><ul><li>Regulated in Bermuda by BMA (GAAL & GAAIFL) </li></ul><ul><li>Regulated in Malaysia by LOFSA (GAAD) </li></ul><ul><li>Regulated in Singapore by MAS (GAAS) </li></ul><ul><li>Has raised in excess of USD 200,000,000.00 worldwide </li></ul>
  11. 11. <ul><li>Current Investor Profile </li></ul><ul><ul><li>78% of funds raised from 24 insurance companies, banks and trust companies </li></ul></ul><ul><ul><li>22% of funds raised from private investors </li></ul></ul><ul><ul><li>Institutional investment in GAA is based solely on GAA fulfilling high standards of due diligence </li></ul></ul>
  12. 12. Current Investor Profile As of 1 May 2009, 27 separate ‘platform providers’ had approved the purchase of GAA Funds
  13. 13. Where’s Bermuda?
  14. 14. Where’s Bermuda? <ul><li>Situated 774 miles of east coast of United States </li></ul><ul><li>Stable political and economic environment since 1612 </li></ul><ul><li>Self governing Dependent Territory of UK </li></ul>
  15. 16. quant  [ kwont ] noun   ( informal ) X Mary Quant?
  16. 17. quant  [ kwont ] noun   ( informal ) a highly paid computer specialist with a degree in a quantitative science, employed by a financial house, to predict the future price movements of securities, commodities, currencies, etc. [ETYMOLOGY: 20th Century: from quantitative]
  17. 19. quant fund management Quant managers use complex mathematical computer models developed by scientists & academics to identify and filter specific sets of stock characteristics.
  18. 20. quant fund management Quant managers use complex mathematical computer models developed by scientists & academics to identify and filter specific sets of stock characteristics. Whole markets can be analysed daily for buy and sell signals, allowing portfolios to consider large volumes of information.  
  19. 21. quant fund management Quant managers use complex mathematical computer models developed by scientists & academics to identify and filter specific sets of stock characteristics. Whole markets can be analysed daily for buy and sell signals, allowing portfolios to consider large volumes of information .   Emotion and personal biases that can hinder effective portfolio management are eliminated, while allowing insights into market inefficiencies to be applied rapidly across a vast number of securities.
  20. 23. moore’s law /morz law/ prov. The observation that the logic density of silicon integrated circuits has closely followed the curve (bits per square inch) = 2^(t - 1962) where t is time in years;
  21. 24. moore’s law /morz law/ prov. The observation that the logic density of silicon integrated circuits has closely followed the curve (bits per square inch) = 2^(t - 1962) where t is time in years; that is, the amount of information storable on a given amount of silicon has roughly doubled every year since the technology was invented.
  22. 25. moore’s law /morz law/ prov. The observation that the logic density of silicon integrated circuits has closely followed the curve (bits per square inch) = 2^(t - 1962) where t is time in years; that is, the amount of information storable on a given amount of silicon has roughly doubled every year since the technology was invented. Gordon Moore, co-founder of Intel, first predicted the above more than 40 years ago…
  23. 29. INVESTMENT ISSUES
  24. 30. INVESTMENT ISSUES <ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchase? </li></ul>
  25. 31. <ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchase? </li></ul><ul><li>How often should a Portfolio be REBALANCED? </li></ul>INVESTMENT ISSUES
  26. 32. <ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchase? </li></ul><ul><li>How often should a Portfolio be REBALANCED? </li></ul><ul><li>Don’t investors deserve HANDS ON discretionary management? </li></ul>INVESTMENT ISSUES
  27. 33. <ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchase? </li></ul><ul><li>How often should a Portfolio be REBALANCED? </li></ul><ul><li>Don’t investors deserve HANDS ON discretionary management? </li></ul><ul><li>Don’t investors deserve some PROTECTION against falling markets? </li></ul>INVESTMENT ISSUES
  28. 34. <ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchase? </li></ul><ul><li>How often should a Portfolio be REBALANCED? </li></ul><ul><li>Don’t investors deserve HANDS ON discretionary management? </li></ul><ul><li>Don’t investors deserve some PROTECTION against falling markets? </li></ul><ul><li>Can all of the above issues be SOLVED in a structured, repeatable manner? </li></ul>INVESTMENT ISSUES
  29. 36. INVESTMENT ISSUES <ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchase? </li></ul>
  30. 37. INVESTMENT ISSUES <ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchase? </li></ul><ul><li>The Solution </li></ul><ul><ul><li>The GAA ‘quant’ model analyses ALL relevant data available on the complete universe of stocks </li></ul></ul>
  31. 38. INVESTMENT ISSUES <ul><li>How much global data should a global equity manager ANALYSE before selecting a stock for purchase? </li></ul><ul><li>The Solution </li></ul><ul><ul><li>The GAA ‘quant’ model analyses ALL relevant data available on the complete universe of stocks </li></ul></ul><ul><ul><li>Complete data on more than 38,000 stocks listed on 52 global stock exchanges is extracted and analysed from multiple institutional data feeds </li></ul></ul>
  32. 39. <ul><li>How often should a Portfolio be REBALANCED? </li></ul>INVESTMENT ISSUES
  33. 40. <ul><li>How often should a Portfolio be REBALANCED? </li></ul><ul><li>The Solution </li></ul><ul><ul><li>GAA utilises a forward looking stock selection methodology which looks forward 30 days only </li></ul></ul>INVESTMENT ISSUES
  34. 41. <ul><li>How often should a Portfolio be REBALANCED? </li></ul><ul><li>The Solution </li></ul><ul><ul><li>GAA utilises a forward looking stock selection methodology which looks forward 30 days only </li></ul></ul><ul><ul><li>The portfolio is COMPLETELY rebalanced every 30 days </li></ul></ul>INVESTMENT ISSUES
  35. 42. <ul><li>How often should a Portfolio be REBALANCED? </li></ul><ul><li>The Solution </li></ul><ul><ul><li>GAA utilises a forward looking stock selection methodology which looks forward 30 days only </li></ul></ul><ul><ul><li>The portfolio is COMPLETELY rebalanced every 30 days </li></ul></ul><ul><ul><li>There is NO correlation between the portfolio held one month and that of the next </li></ul></ul>INVESTMENT ISSUES
  36. 43. <ul><li>Don’t investors deserve HANDS ON discretionary management? </li></ul>INVESTMENT ISSUES
  37. 44. <ul><li>Don’t investors deserve HANDS ON discretionary management? </li></ul><ul><li>The Solution </li></ul><ul><li>Size of underlying portfolio large enough to consider 52 markets – smaller portfolios cannot </li></ul>INVESTMENT ISSUES
  38. 45. <ul><li>Don’t investors deserve HANDS ON discretionary management? </li></ul><ul><li>The Solution </li></ul><ul><li>Size of underlying portfolio large enough to consider 52 markets – smaller portfolios cannot </li></ul><ul><li>Real time data feeds provide up to the minute information across 52 markets </li></ul>INVESTMENT ISSUES
  39. 46. <ul><li>Don’t investors deserve HANDS ON discretionary management? </li></ul><ul><li>The Solution </li></ul><ul><li>Size of underlying portfolio large enough to consider 52 markets – smaller portfolios cannot </li></ul><ul><li>Real time data feeds provide up to the minute information across 52 markets </li></ul><ul><li>Data is analysed every day of every week of every month </li></ul>INVESTMENT ISSUES
  40. 47. <ul><li>Don’t investors deserve HANDS ON discretionary management? </li></ul><ul><li>The Solution </li></ul><ul><li>GAA has established the ability to execute trades in 52 countries - many institutions have difficulty in acquiring or disposing foreign stocks on certain counters </li></ul>INVESTMENT ISSUES
  41. 48. <ul><li>Don’t investors deserve some PROTECTION against falling markets? </li></ul>INVESTMENT ISSUES
  42. 49. <ul><li>Don’t investors deserve some PROTECTION against falling markets? </li></ul><ul><ul><li>The Solution </li></ul></ul><ul><ul><li>The Fund buys an ‘insurance policy’ each month which helps protect the Fund in the event that markets fall that month </li></ul></ul>INVESTMENT ISSUES
  43. 50. <ul><ul><li>Data input </li></ul></ul>
  44. 51. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>The Fund’s underlying ‘quant’ model analyses ALL relevant data available on the complete universe of stocks. </li></ul></ul>
  45. 52. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>The Fund’s underlying ‘quant’ model analyses ALL relevant data available on the complete universe of stocks. </li></ul></ul><ul><ul><li>This requires significant computing power as well as complete data on more than 38,000 stocks listed on 52 global stock exchanges at any given time. </li></ul></ul>
  46. 53. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>The Fund’s underlying ‘quant’ model analyses ALL relevant data available on the complete universe of stocks. </li></ul></ul><ul><ul><li>This requires significant computing power as well as complete data on more than 38,000 stocks listed on 52 global stock exchanges at any given time. </li></ul></ul><ul><ul><li>Thanks to Moore’s Law, computing power today is fast enough to allow us to run the models required for real time quant data management. </li></ul></ul>
  47. 54. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>The costs inherent in such a programme are significant: </li></ul></ul>
  48. 55. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>The costs inherent in such a programme are significant: </li></ul></ul><ul><ul><li>Quant model development costs </li></ul></ul>
  49. 56. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>The costs inherent in such a programme are significant: </li></ul></ul><ul><ul><li>Quant model development costs </li></ul></ul><ul><ul><li>Quant model maintenance and operational costs </li></ul></ul>
  50. 57. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>The costs inherent in such a programme are significant: </li></ul></ul><ul><ul><li>Quant model development costs </li></ul></ul><ul><ul><li>Quant model maintenance and operational costs </li></ul></ul><ul><ul><li>the cost of real time global analytical data </li></ul></ul>
  51. 58. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul>
  52. 59. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Only mid to large cap stocks are selected for the portfolio each month. </li></ul></ul>
  53. 60. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Only mid to large cap stocks are selected for the portfolio each month. </li></ul></ul><ul><ul><li>Typically more than 90% of stocks selected by the model each month are capitalised at more than US$100 million each, whilst more than 50% are capitalised at more than US$1 billion. </li></ul></ul>
  54. 61. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul>
  55. 62. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul><ul><ul><li>By far the most important element of the programme is the proprietary ‘quant’ stock selection process. </li></ul></ul>
  56. 63. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul><ul><ul><li>By far the most important element of the programme is the proprietary ‘quant’ stock selection process. </li></ul></ul><ul><ul><li>The process was developed over period of seven years by GAA’s appointed ‘quant’ team headed by a former university lecturer with a Masters degree (honours) in Computer Engineering , as well as separate degrees in both Banking and Finance. </li></ul></ul>
  57. 64. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul><ul><ul><li>No stock will be considered unless at least 4 independent stock reports are available for consideration. </li></ul></ul>
  58. 65. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul><ul><ul><li>No stock will be considered unless at least 4 independent stock reports are available for consideration. </li></ul></ul><ul><ul><li>Consequently more than 3,800,000 individual analyst opinions (38,000 x 4 feeds x 25 variables per stock) could be considered and incorporated into the stock selection model each month. </li></ul></ul>
  59. 66. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul><ul><ul><li>Monthly reweighting </li></ul></ul>
  60. 67. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul><ul><ul><li>Monthly reweighting </li></ul></ul><ul><ul><li>The stock selection process is run continuously resulting in the portfolio being completely rebalanced every 30 days. </li></ul></ul>
  61. 68. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul><ul><ul><li>Monthly reweighting </li></ul></ul><ul><ul><li>The stock selection process is run continuously resulting in the portfolio being completely rebalanced every 30 days. There is NO correlation between the portfolio held one month and that of the next. </li></ul></ul>
  62. 69. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul><ul><ul><li>Monthly reweighting </li></ul></ul><ul><ul><li>The stock selection process is run continuously resulting in the portfolio being completely rebalanced every 30 days. There is NO correlation between the portfolio held one month and that of the next. NO stocks are ever automatically held across to the next month unless they are reselected based on their own fundamental merits. </li></ul></ul>
  63. 70. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul><ul><ul><li>Monthly reweighting </li></ul></ul><ul><ul><li>On average 70% of stocks held are replaced each month. </li></ul></ul>
  64. 71. GAA USD Global ‘Q’ Fund: Asset Allocation @ May 2009
  65. 72. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul><ul><ul><li>Monthly reweighting </li></ul></ul><ul><ul><li>Maximum weighting </li></ul></ul>
  66. 73. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul><ul><ul><li>Monthly reweighting </li></ul></ul><ul><ul><li>Maximum weighting </li></ul></ul><ul><ul><li>No single stock will account for more than 5% of portfolio NAV; no single country will make up more than 30% of portfolio NAV (other than the US and/or Japan which could make up to 50% of portfolio NAV) </li></ul></ul>
  67. 74. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul><ul><ul><li>Monthly reweighting </li></ul></ul><ul><ul><li>Maximum weighting </li></ul></ul><ul><ul><li>Diversification </li></ul></ul>
  68. 75. <ul><ul><li>Data input </li></ul></ul><ul><ul><li>Liquidity </li></ul></ul><ul><ul><li>Dynamic stock selection process </li></ul></ul><ul><ul><li>Monthly reweighting </li></ul></ul><ul><ul><li>Maximum weighting </li></ul></ul><ul><ul><li>Diversification </li></ul></ul><ul><ul><li>Typically 150 - 200 stocks are purchased each month. </li></ul></ul>
  69. 76. <ul><ul><li>Dynamic stock selection process in more detail </li></ul></ul><ul><ul><li>Momentum factors </li></ul></ul><ul><ul><li>The model takes into account both historic and future forecasts with regards to stock momentum… </li></ul></ul>
  70. 77. <ul><ul><li>Dynamic stock selection process in more detail </li></ul></ul><ul><ul><li>Momentum factors </li></ul></ul><ul><ul><li>The model takes into account both historic and future forecasts with regards to stock momentum… </li></ul></ul><ul><ul><ul><li>Analyst Revision: FY1 & FY2 ( a minimum of four research reports must be available) </li></ul></ul></ul><ul><ul><ul><li>Change in Consensus Earnings: 1 & 3 months of both FY1 & FY2 </li></ul></ul></ul><ul><ul><ul><li>Price Change: last month </li></ul></ul></ul>
  71. 78. <ul><ul><li>Dynamic stock selection process in more detail </li></ul></ul><ul><ul><li>Valuation factors </li></ul></ul><ul><ul><li>The model takes into account both current and future forecasts with regards to stock valuation… </li></ul></ul>
  72. 79. <ul><ul><li>Dynamic stock selection process in more detail </li></ul></ul><ul><ul><li>Valuation factors </li></ul></ul><ul><ul><li>The model takes into account both current and future forecasts with regards to stock valuation… </li></ul></ul><ul><ul><ul><li>Earnings Growth: FY1 & FY2 </li></ul></ul></ul><ul><ul><ul><li>Forward Price Earnings Ratio: FY1 & FY2 </li></ul></ul></ul><ul><ul><ul><li>Price to Book Value: FY1 </li></ul></ul></ul><ul><ul><ul><li>Dividend Yield: FY1 </li></ul></ul></ul><ul><ul><ul><li>Price to Cash Earnings: FY1 </li></ul></ul></ul><ul><ul><ul><li>Price to Sales Ratio: FY1 & FY2 </li></ul></ul></ul><ul><ul><ul><li>EBITDA Growth: FY1 & FY2 </li></ul></ul></ul>
  73. 80. <ul><ul><li>Dynamic stock selection process in more detail </li></ul></ul><ul><ul><li>Complete table with all factors in the total universe </li></ul></ul>
  74. 81. <ul><ul><li>Dynamic stock selection process in more detail </li></ul></ul><ul><ul><li>Factor weighting allocation process </li></ul></ul><ul><ul><li>The key to the success of the strategy is the method used for assigning weightings to the different factors. </li></ul></ul>
  75. 82. <ul><ul><li>Dynamic stock selection process in more detail </li></ul></ul><ul><ul><li>Factor weighting allocation process </li></ul></ul><ul><ul><li>The key to the success of the strategy is the method used for assigning weightings to the different factors. </li></ul></ul><ul><ul><ul><li>Extensive back testing of factors and cross factor combinations </li></ul></ul></ul><ul><ul><ul><li>Screening for market movement in the factors for different time intervals </li></ul></ul></ul><ul><ul><ul><li>Optimisation of timing </li></ul></ul></ul>
  76. 83. <ul><ul><li>Dynamic stock selection process in more detail </li></ul></ul><ul><ul><li>Factor weighting allocation process </li></ul></ul><ul><ul><li>The result of this dynamic process is a monthly listing of those stocks most likely to perform over the next 30 days from a universe of more than 38,000 worldwide… </li></ul></ul>
  77. 84. <ul><ul><li>Dynamic stock selection process in more detail </li></ul></ul>
  78. 85. <ul><ul><li>Dynamic stock selection process in more detail </li></ul></ul><ul><ul><li>Factor weighting allocation process </li></ul></ul><ul><ul><li>As can be seen from this actual snap shot, 9 of the top 10 stocks selected were listed in different countries whilst 18 of the top 32 were traded on different stock markets… </li></ul></ul>
  79. 86. <ul><ul><li>Dynamic stock selection process in more detail </li></ul></ul>
  80. 87. <ul><ul><li>Dynamic stock selection process in more detail </li></ul></ul><ul><ul><li>The ‘Quant’ model in action – an actual example </li></ul></ul><ul><ul><li>HK listed Orient OS International was identified as being a “strong buy” . The model re-selected this stock every month for the following 7 months and thus it was retained within the portfolio. </li></ul></ul><ul><ul><li>It provided a net gain of 316% over this period… </li></ul></ul>
  81. 88. <ul><ul><li>Dynamic stock selection process in more detail </li></ul></ul><ul><ul><li>The Quant model in action – an actual example </li></ul></ul>
  82. 89. <ul><ul><li>Dynamic hedging facility in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse market conditions </li></ul></ul>
  83. 90. <ul><ul><li>Dynamic hedging facility in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse market conditions </li></ul></ul><ul><ul><li>The stocks chosen for purchase each month are rigorously filtered, and yet the stock portfolio itself will always be ‘long’ only. </li></ul></ul>
  84. 91. <ul><ul><li>Dynamic hedging facility in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse market conditions </li></ul></ul><ul><ul><li>The stocks chosen for purchase each month are rigorously filtered, and yet the stock portfolio itself will always be ‘long’ only. </li></ul></ul><ul><ul><li>Although proven time and again to be able to secure gains in both bull and bear markets, any ‘long’ only portfolio is subject to sudden and unexpected drawdowns in the market economy… </li></ul></ul>
  85. 92. <ul><ul><li>Dynamic hedging facility in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse market conditions </li></ul></ul><ul><ul><li>To that end, the GAA Global ‘Q’ Fund employs a dynamic hedging facility. </li></ul></ul>
  86. 93. <ul><ul><li>Dynamic hedging facility in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse market conditions </li></ul></ul><ul><ul><li>Each month, the model buys ‘put’ options on the underlying component stock indices which make up the MSCI World Index in order to protect the portfolio in the event those markets fall… </li></ul></ul>
  87. 94. <ul><ul><li>Dynamic hedging facility in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse market conditions </li></ul></ul><ul><ul><li>Consequently the ‘long only’ portfolio always enjoys an element of protection against the components of the MSCI from falling… </li></ul></ul>
  88. 95. <ul><ul><li>Dynamic hedging facility in more detail </li></ul></ul><ul><ul><li>Protecting the Portfolio against adverse market conditions </li></ul></ul><ul><ul><li>Consequently the ‘long only’ portfolio always enjoys an element of protection against the components of the MSCI from falling… </li></ul></ul><ul><ul><li>Every month the Fund protects 50% of the value of the long only portfolio. If markets are deemed to be unstable or listless, this is increased to 100% of the value, resulting in zero net exposure to global stock market movements… </li></ul></ul>
  89. 96. The Result?
  90. 97. Returns which have consistently beaten all major global stock markets…
  91. 98. NB Uncompounded figures used in this back tested graph are proforma and net of all management fees 98 winning months out of 132 (during pre launch testing from 1993 to 2004)
  92. 99. NB Uncompounded figures used in this back tested graph are proforma and net of all management fees … and significant out performance of the MSCI
  93. 100. The statistics speak for themselves… NB Uncompounded figures used in this back tested graph are proforma and net of all management fees -13.74% Largest monthly drawdown 5.84% Standard Deviation (monthly) -21.34% Maximum drawdown 2.80% Av Monthly Return (compounded) 3.29 Sortino ratio @ 4.34% rfr 394.14% Total Return (non compounded) 1.56 Sharpe ratio @ 4.34% rfr 39.32% Annualised ROR (11 yrs) 34 No. of negative months 72.10% 2003 Net Return 98 No. of positive months 4.58% Jan 04 Net Return
  94. 101. NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launch has been impressive…
  95. 102. NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launch has been impressive…
  96. 103. NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launch has been impressive… 1 May 2004 – 1 May 2009: +110.37% gain net of charges in 60 months of trading
  97. 104. NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launch has been impressive… 1 May 2004 – 1 May 2009: +110.37% gain net of charges in 60 months of trading (versus -14.27% loss made by MSCI World Index over same period!)
  98. 105. How has ‘Q’ Fund compared with the MSCI World Index? MSCI ‘ Q’ YEAR
  99. 106. How has ‘Q’ Fund compared with the MSCI World Index? +7.56% MSCI 2005 ‘ Q’ YEAR
  100. 107. How has ‘Q’ Fund compared with the MSCI World Index? +17.95% +7.56% MSCI 2006 2005 ‘ Q’ YEAR
  101. 108. How has ‘Q’ Fund compared with the MSCI World Index? +7.09% 2007 +17.95% +7.56% MSCI 2006 2005 ‘ Q’ YEAR
  102. 109. How has ‘Q’ Fund compared with the MSCI World Index? +7.09% 2007 -42.08% +17.95% +7.56% MSCI 2008 2006 2005 ‘ Q’ YEAR
  103. 110. How has ‘Q’ Fund compared with the MSCI World Index? +7.09% 2007 -42.08% +17.95% +7.56% MSCI 2008 2006 +20.78% 2005 ‘ Q’ YEAR
  104. 111. How has ‘Q’ Fund compared with the MSCI World Index? +7.09% 2007 -42.08% +17.95% +7.56% MSCI 2008 +17.72% 2006 +20.78% 2005 ‘ Q’ YEAR
  105. 112. How has ‘Q’ Fund compared with the MSCI World Index? +33.22% +7.09% 2007 -42.08% +17.95% +7.56% MSCI 2008 +17.72% 2006 +20.78% 2005 ‘ Q’ YEAR
  106. 113. How has ‘Q’ Fund compared with the MSCI World Index? +33.22% +7.09% 2007 -42.08% +17.95% +7.56% MSCI -1.90% 2008 +17.72% 2006 +20.78% 2005 ‘ Q’ YEAR
  107. 114. Total returns compared 1 May ’04 – 1 May ‘09 ‘ Q’ MSCI
  108. 115. Total returns compared 1 May ’04 – 1 May ‘09 -14.27% ‘ Q’ MSCI
  109. 116. Total returns compared 1 May ’04 – 1 May ‘09 +110.37% -14.27% ‘ Q’ MSCI
  110. 117. NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launch has been impressive… Average winning month: +4.95% ; Average losing month: -2.82%
  111. 118. NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launch has been impressive… Average winning month: +4.95% ; Average losing month: -2.82% 60% (36/60) winning months vs 40% (24/60) losing months
  112. 119. NB Figures used in this graph are based on actual NAV and are net of all management fees Real time performance since launch has been impressive… Average winning month: +4.95% ; Average losing month: -2.82% 60% (36/60) winning months vs 40% (24/60) losing months
  113. 120. 41 out of 49 x 12 month rolling returns have been positive
  114. 121. 41 out of 49 x 12 month rolling returns have been positive
  115. 122. 41 out of 49 x 12 month rolling returns have been positive BEST 12 month rolling return since launch: +60.24% vs +22.28% MSCI WORST 12 month rolling return since launch: -18.09% vs -44.57% MSCI
  116. 123. <ul><li>Corporate Strength </li></ul><ul><li>Fund : GAA USD Global ‘Q’ Fund </li></ul><ul><li>Issued by : GAA Investment Funds Limited, Bermuda </li></ul><ul><li>Fund Manager : Global Asset Allocation Limited, Bermuda </li></ul><ul><li>Custodian : Bermuda Commercial Bank, Bermuda </li></ul><ul><li>Administrator : ICMOB, Bermuda </li></ul><ul><li>Auditor : Deloitte & Touche, Bermuda </li></ul><ul><li>Legal Council : Conyers Dill & Pearman, Bermuda </li></ul><ul><li>Authority : Bermuda Monetary Authority </li></ul>
  117. 124. <ul><li>Key Features of GAA USD Global ‘Q’ Fund </li></ul><ul><li>Excellent performance: +110.37% May 2004 – May 2009 </li></ul><ul><li>+16.04% pa annualised return since launch </li></ul><ul><li>-18.09% to +60.24% 12 month rolling returns since launch </li></ul><ul><li>SIGNIFICANT outperformance of MSCI World Index since launch: +110.37% vs -14.27% </li></ul><ul><li>Retail access to ‘quant’ fund either directly or via institutions </li></ul><ul><li>Zero cost of purchase: redemption fees zero after 5 yrs </li></ul>
  118. 126. Jeremy Smeeton Managing Director Global Asset Allocation Limited GAA Investment Funds Limited THANK YOU!
  119. 127. Jeremy Smeeton Managing Director Global Asset Allocation Limited GAA Investment Funds Limited THANK YOU!
  120. 128. <ul><li>This presentation does not constitute investment advice specific to any one individual investor and is not an offer to purchase the GAA USD Global ‘Q’ Fund (“the Fund”), which may only be bought under the terms of the prospectus. The Fund is a Class Fund of GAA Investment Funds Limited (“the Company’), a Bermuda based mutual fund company. The Company is an unregulated collective investment scheme under the UK Financial Services Act 1986, and therefore does not carry the protection provided by the UK regulatory system. </li></ul><ul><li>This document is being issued by Global Asset Allocation Limited for information purposes only. Changes in foreign exchange rates may have an adverse effect on the price or value of the investment. No representation is being made by the Fund or its directors as to the accuracy or completeness of the information contained in this document. Past performance is not necessarily a guide to the future. The value of the shares in this Fund may fall as well as rise. </li></ul><ul><li>Returns are paid gross and tax may be due according to the residence or domicile of the investor. Tax concessions are not guaranteed and may change at any time; their value will depend on individual circumstances. It is the investor’s responsibility to ensure that the making or holding of an investment complies with any restrictions or other provisions of any relevant trust deed or any other regulations affecting the investor. </li></ul>

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