Global Fund Exchange - Corporate Profile


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A corporate overview of Global Fund Exchange

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Global Fund Exchange - Corporate Profile

  1. 1. ContentsOur thematic investment universe 3Earth Wind & Fire Fund 4AquaTerra Fund 6Why invest in multi-manager funds? 7Why invest in energy and natural resources? 8Key people 9Risk management 11Investment strategy Q & A 12Due diligence process 14Additional information 16
  2. 2. “We are at the forefront of a worldwide dynamic change. The Energy Revolution will make a lasting difference for generations to come and will bring economic opportunities that are far greater and more far reaching than anything that we have ever seen in the past.” Lauralouise Duffy, CEO 1
  3. 3. Our thematic investment universe Clean Natural Energy Water Agriculture Energy Resources Wheat Mining & Soybean Solar Oil Infrastructure Exploration Corn, Cotton Sugar Precious & Water Wind Coal Rare Earth Treatment Metals Biofuel & Edible Oil Timber & Hydro Gas Water Supply Paper Agri Business Building & Integrated Energy Water Utilities Grid Efficiency Utilities Commodities Agri Science Waste to Refining Agriculture Waste to Energy Services Commodities Energy Land & Farming Exploration & Waste Geothermal Production Management Fertilizer Biofuels Forestry3
  4. 4. The EARTH WIND & FIRE Fund is an actively managed, global macro, multi- strategy, multi-manager investment fund focusing on the future of energy through 8 segregated portfolios: clean energy, water, agriculture, energy, natural resources, carbon, systematic trading and hedging.Our broad spectrum approach to investing across the entire energy grid allowsus to diversify our strategy by geography, sector, asset class and themes. The fund aims to provide our investors with an opportunity to participate in the mega macro opportunities around the globe across the entire energy and scarce resources spectrum while significantly reducing the extreme volatility normally associated with these markets. 4
  5. 5. “We must protect and respect our planet. We have entered into a new era of social and environmental awareness, one that will support the sustainability of our energy, water and critical resources and preserve them for generations to come.”5 Lauralouise Duffy, CEO
  6. 6. Investing in the future of our planet and the most compelling fundamental mega macro trendsfacing our world. This prudently managed multi manager fund harnesses the collective expertise and resources of some of the worlds premier niche managers focused on the growing agriculture, water and scarce natural resources sectors. 6
  7. 7. Why invest in multi-manager funds? • Easy to invest and track performance of one product that gives access to a diverse group of niche boutique specialist Ease Of managers around the world Access • Provides access to funds that are closed or have investment minimums in the millions • Tactical asset allocation to global niche experts in their field • Invest in emerging managers that outperform behemoth Alpha institutions Generation • Macro sector rotation: overweight positive themes, underweight unfavorable sectors • Deep due diligence: Qualitative, Quantitative, Forensic & Operational Reduced • Only work with top-tier counterparties & service providers Risk • Respected Administrator & Custodian mitigate any disaster or fraud risk • Investment pool diversified by asset type, strategy, sector Reduced and geography Volatility • Strategy aims to reduce risk and downside volatility • Capture alpha through portfolio and strategy diversity Reduced • Low correlations between portfolios drastically reduces Drawdown drawdowns  Low correlations to most hedge fund, equity & commodity Return indices Consistency  Since January 2007 portfolio achieved 79% positive months7
  8. 8. Why invest in energy and natural resources?Population and income growth – the two most powerful forces behindrising global demand for energy, water and natural resources. Over the next 20 years… Global shift towards lower carbon energy & CO2 use • 1.4 billion projected increase in population • 100% projected increase in real income • Disproportionately increasing demand for energy, water, natural resources • Relatively inelastic supply Weather & climate • Forces up prices, increases investment, anomalies provides opportunities China, India & developing world natural resource consumption Rapid industrialization & urbanization of emerging markets Peak Oil vs. Peak Cheap Oil Population growth of 79 million people/year 8 7
  9. 9. Key people ANRIC BLATT Chairman ANRIC BLATT  Group Chairman since establishment in 2005 Chairman  Principal activities: strategy allocation, portfolio New York, USA management, manager research, due diligence, new product development & structuring  Experienced specialist investor in energy, hedge funds, systematic trading and commodities  Successfully built a number of multi-manager +1 212 570 7970 x 5603 fund management companies over past 15 years LAURALOUISE DUFFY CEO LAURALOUISE DUFFY  Diverse 20 year career in finance and hedge funds CEO  Experience across multitude of asset classes, both New York, USA emerging & developed markets  Extensive background in risk management, manager due diligence, legal, compliance, product structuring and development, and hedge fund operational management +1 212 570 7970 x 5601 JIM MOORE Director  Distinguished career in finance spanning almost JIM MOORE 40 years Director  Holds one of Wall Street’s longest multi-manager New York, USA track records  Early pioneer of both discretionary and systematic commodity trading  Extensive risk and return management skills  Special forces veteran +1 212 570 7970 MICHAEL LEITH SMITH Director  Over 40 years experience in the international MICHAEL LEITH SMITH financial and business community Director  Extensive directorship experience Frankfurt, Germany  Versatile and far-reaching skill set  Wide-reaching global network +49 173 948 9939
  10. 10. NICHOLAS YEAGERChief Information OfficerHead of Quantitative Analysis NICHOLAS YEAGER Dynamic 13 year career at the cross section of Chief Information Officer technology and finance Head of Quantitative Analysis Experience in quantitative portfolio optimization New York, USA and risk management In depth knowledge of computerized trading systems, execution platforms, Specialist in secure IT infrastructure & +1 212 570 7970 x 5599 communications, disaster recovery and data retentionHEINI BERETTAPortfolio Research Analyst Sources new European based investment HEINI BERETTA opportunities Portfolio Research Analyst Conducts manager due diligence London, UK Worked for over a decade with alternative investments and complex derivatives at GAM, Crédit Agricole & Lazard Certifications include: Securities and Financial Derivatives Representative, Investment +44 (0) 7798 855 858 Management Certificate Member of CFA UK LORRAINE KIMMEY Financial Comptroller  Over 30 years of experience in the banking and LORRAINE KIMMEY finance industry Financial Comptroller  Responsible for the auditing of trading and New York, USA settlements  Day to day financial oversight of Global Fund Exchange companies worldwide +1 212 570 7970 x 5602 APRIL LERNER Research Analyst  Joined team in 2008 to specialize in global APRIL LERNER energy and resources sectors Research Analyst  Holds a B.A., magna cum laude, from Amherst New York, USA College  Research background in energy, environmental economics, renewable energy  Honors thesis recognized by the Doshisha University, Kyoto, Japan +1 212 570 7970 x 5598 11
  11. 11. Risk management Risk Management Guidelines• Allocation never exceeds 10% of underlying manager‟s AUM• Only invest in funds with a diverse investor concentration• Avoid funds that lack reasonable liquidity• All assets are held in custody of independent custodian and externally administered• Investment team follows strict order execution process – electronic draft entered, approved by firm principals, final execution by independent custodian Asset Allocation• Macro strategy implemented through top-down strategic approach• Asset class, geography, sector, strategy diversification without dilution• Rigorous profit taking – avoid compressed risk by sector outperformance• Deep qualitative, quantitative and forensic study of underlying portfolios and advisors Liquidity• Liquidity is always considered before making an investment• Liquidity of our portfolios is calculated monthly to ensure we can deliver• Liquidity transparency is made available to our investors• No leverage applied at fund of funds level. Quantitative Analysis• All portfolios subject to grueling stress tests• Monthly portfolio optimization and advanced algorithms used to compare invested vs. on-deck vs. watch list assets• Proprietary database of hedge funds, market indices and ETFs updated monthly• Data used to test various portfolio scenarios and investment weightings• Monthly „Risk and Rank‟ report review of invested funds and >100 watch list funds, all of which we have relationships with and are potential investments• Weekly estimates of all invested funds to better monitor short term correlations, estimate to final performance variance and force weekly contact with all managers Qualitative Analysis• Both scheduled and „surprise‟ on-site visits required prior to investment• Investment team and operational staff are interviewed several times• Qualitative team analyzes each potential fund, produces a detailed report and assigns investment grade• Complete background check on all key people conducted using premier security forensic research consulting firm • Full audit and verification of all fund counterparties in order to virtually eliminate11 counterparty risk
  12. 12. Investment Strategy Q&A What is driving new opportunity in this space? Global policy changes, stimulus spending, subsidy programs, legislation emissions and fuel restrictions are being implemented in developed and developing countries alike, opening new opportunities for both emerging energy and cleaner forms of traditional energy. Cash-flow rich integrated energy companies, sovereign wealth funds, pension funds, utilities and technology companies worldwide are spending vast amounts of money in the energy, commodity and natural resources sectors right now. What first drew you to this strategy? Every person needs the vital resources of energy, water and food. The stress on these assets due to population growth, industrialization and finite / declining resources has created a MUST outcome for the planet. At the same time, every developed country in the world is focused on how to provide energy and food security for its people. Every major corporation in the world is focused on the business opportunity and how to be a part of it. We recognize that these sectors represent the mega macro trends for the next decades and beyond. How do you identify opportunities? Our investment direction is primarily driven by our extensive macro research. We focus on large, long term profit opportunities brought about by increasing demand for energy and commodities, fuelled by increasing population and accelerated industrialization of emerging economies. We track and capitalize on investment themes brought about by global policy shifts, legislation and stimulus. We closely monitor the flow of capital into these sectors. Describe your typical allocation strategy. Our portfolios are weighted accordingly across our three primary sectors:  Equity sensitive strategies (predominantly long-biased): clean energy, water, agriculture  Commodity sensitive strategies (demand and policy sensitive): energy, natural resources and carbon & emissions  Alpha/Trend sensitive strategies (showing negative bear market correlation to equity sensitive strategies): systematic traders, uncorrelated hedges, cash and equivalents. How do you determine sector weights and allocation sizes? We allocate capital to sectors that show the most potential, while taking profits or reducing allocations to sectors that have already experienced significant outperformance. The size of an allocation is impacted by the underlying manager‟s ability to deploy capital profitably, manage risk and downside volatility. If our research indicates uncertain times ahead for a particular sector, we proactively limit our exposure, and redistribute capital to sectors that show more promise. Sector allocations and weightings are also limited by our risk management policies. Positions are sized according to expected and realized volatility. 12
  13. 13. “The World Water Council warns that humans are extracting fresh water at rates up 100x the natural replenishment rate. Water and energy are inextricably linked and so are the investment opportunities associated with their scarcity.” Anric Blatt, Chairman
  14. 14. Due diligence process  Complete legal document review  Is this a sensibly conducted business?  Verification of service providers  Compensation structure  Worst case scenario liquidity analysis  Focus on references  Investigation of side pockets, side letters  Threading key people PROSPECTUS PEOPLE • Fund Structure • The Organization • Terms & Conditions • Ownership Structure • Liquidity • Philosophy • Reputation • Key Man PORTFOLIO PROCESS • Useful Transparency • Investment Strategy • Value add to sub portfolio • Risk Management • Correlation • Decision making • Risk & Return analysis • Operations PERFORMANCE • Track record • Financial Statements • Independent verification • Regulatory reports Do not take manager‟s word, verify  Identification of core expertise Analysis against peers  Investment decision rules Truly understand portfolio and be able to  Do they stick to the rules? value it independently  Independent risk management? Weekly estimates  Robust process? 14
  15. 15. “Treat the Earth well. It was not given to you by your parents. It was loaned to you by your children.” Kenyan Proverb
  16. 16. Additional Information Manager & Service Provider Details Investment manager Global Fund Exchange Ltd. 20 Genesis Close, P.O. Box 1344 Grand Cayman, KY1-1108 Cayman Islands Administrator Deutsche Bank Alternative Fund Services Custodian Deutsche Bank (Cayman) Ltd. Auditor EisnerAmper LLP Legal Advisors Walkers LLP - Cayman Tannenbaum – USA Contact Information Corporate Headquarters Global Fund Exchange 20 Audrey Avenue Oyster Bay, NY 11771 United States of America +1 212 570 7970 Manager email Service Provider Deutsche Bank 16
  17. 17. Notes 16
  18. 18. DisclaimerUse of this presentation is governed by our User Agreement. The content contained in this presentation is believed to be accurate atthe time it was made, but is provided to users "AS IS" without any express or implied warranty as to merchantability, non-infringement, accuracy, completeness, timeliness, sequencing, fitness for a particular purpose or otherwise. Please read this useragreement carefully before using the presentation. By continuing your use of this presentation and each time you use thepresentation, your use indicates your full acceptance of and agreement to abide by this user agreement in its then current form. Ifyou do not accept the terms and conditions stated in this user agreement, do not use the presentation.Before making an investment decision with respect to the Earth Wind & Fire Fund Ltd (the “Fund” or “EW&F Fund”) managed byGlobal Fund Exchange Ltd. (the “Investment Manager”), potential investors are advised to read carefully the respective offeringdocuments (including any relevant underlying agreements) and the related subscription documents regarding the Fund when theyare available, and to consult with their tax, legal, ERISA and financial advisors. This document contains a preliminary summary of thepurpose and principal business terms of the Fund; this summary does not purport to be complete and is qualified in its entirety byreference to the more detailed discussions to be contained in the Fund’s offering documentation. The Investment Manager has theability in its sole discretion to change the strategies described herein. This document is being provided to you on a confidential basissolely to assist you in deciding whether or not to proceed with a further investigation of the Fund. This material is provided forinformational purposes only as of the date hereof and is subject to change without notice. Accordingly, this document may not bereproduced in whole or part, and may not be delivered to any person without the consent of the Investment Manager. This materialmay not be suitable for all investors and is not intended to be, nor shall it be construed as legal, tax or investment advice or as anoffer, or the solicitation of any offer, to buy or sell any securities. No offer or solicitation may be made prior to the delivery of theFund’s respective offering documents to qualified investors. Before making any investment, you should thoroughly review a Fund’soffering documents with your legal, tax and investment advisors to determine whether an investment is suitable for you in light ofyour investment objectives and financial situation.An investment in any Fund is not suitable for all investors. Although believed to be reliable, the information contained herein,including investment returns, valuations, fund targets and strategies cannot be guaranteed. Global Fund Exchange makes norepresentations or warranties as to the accuracy, validity or completeness of such information. This material is not complete and issubject to the more complete disclosures and terms and conditions contained in a particular Fund’s offering documents, which maybe obtained directly from the Fund. No representation or assurance is made that any Fund will or is likely to achieve its objectives,benchmarks or targeted returns or that any investor will or is likely to achieve a profit or will be able to avoid incurring substantiallosses. Past performance is no guarantee of future results. The Fund is NOT subject to the same regulatory requirements as mutualfunds, including mutual fund requirements to provide certain periodic and standardized pricing and valuation information toinvestors. You should note the following: The Fund represents a speculative investment and involves a high degree of risk. An investorcould lose all or a substantial portion of his/her investment. Any investment in the Fund should be discretionary capital set asidestrictly for speculative purposes. The Funds may invest outside of the United States, which may involve greater risk. Strategiesintended to hedge risk may be partly or wholly unsuccessful. An investment in the Fund is not suitable for all investors. . The Fundsperformance may be volatile. The Fund may use benchmarks or targets for measurement purposes.There is no guarantee that the Funds goals, objectives, benchmarks or targeted returns will be achieved or reached. The Funds feesand expenses-which may be substantial regardless of any positive return-will offset the fund’s trading profits. The Fund and itsmanagers/advisors may be subject to various conflicts of interest. This summary is not a complete list of the risks and otherimportant disclosures involved in investing in the Fund and is subject to the more complete disclosures contained in the Fund’srespective offering documents, which should be read carefully. This document contains forward-looking statements, includingobservations about markets and industry and regulatory trends as of the original date of this document. Forward- looking statementsmay be identified by, among other things, the use of words such as “expects,” “anticipates,” “believes,” or “estimates,” or thenegatives of these terms, and similar expressions. Forward-looking statements reflect the Investment Manager’s views as of suchdate with respect to possible future events. Actual results could differ materially from those in the forward-looking statements as aresult of factors beyond the Fund’s control. Investors are cautioned not to place undue reliance on such statements. No party has anobligation to update any of the forward-looking statements in this document. These materials should only be considered current asof the date of publication without regard to the date on which you may receive or access the information. The Investment Managermaintains the right to delete or modify information without prior notice. Charts, tables and graphs contained in this document arenot intended to be used to assist the reader in determining which securities to buy or sell or when to buy or sell securities. The fundhas limited operating or performance history. The performance shown is for illustration purposes, should not be relied upon, doesnot necessarily reflect actual investor performance, and is not indicative of the results which may be achieved by the EW&F Fund inthe future. Past performance is not necessarily indicative of future results. There can be no assurance and no representation is madethat the Fund will make any profit, and a total loss of principal may occur. The use of differing performance calculationmethodologies may produce different results, and the Funds performance Information may not be comparable to the performanceinformation provided by other funds or managers. Individual investors may not get the exact performance quoted above as theinteraction of fees, timing of investment and high-water mark may affect investors differently. Past performance is definitely notindicative of future performance. There can be no assurance and no representation is made that the fund will make any profit, andas with all investments, a total loss of principal may occur. Prospective investors should refer to the Confidential OfferingMemorandum of the fund for a detailed discussion of the risks and other considerations involved with making an investment in theFund. No representation is being made that the Fund will or is likely to achieve its objectives or will or will make any profits similar toor will not incur substantial losses. Past performance is not a guarantee of future results. The information in this presentation is notintended to constitute legal, tax or accounting advice or investment recommendations and clients should consult their own advisorson such matters.