ALTIN market review and portfolio holdings as of 1 st October 2013 Freitag, 11. Oktober 2013 - 18:31

ALTIN: Q3 2013 commentary

Hedge funds ended the quarter in positive territory although returns differed significantly by strategy. Equity related strategies such as Equity Long/Short, Event Driven and Equity Market Neutral (which was the best performing strategy) performed particularly well. A stock picking approach supported by a strong dispersion of returns between good and bad companies and more generally a positive, albeit volatile equity market, all contributed to deliver strong alpha. Convertible Bond strategies also performed very well, just shy of the performance of Equity Market Neutral, thanks to an overall supportive credit and equity market environment, but also thanks to additional gamma trading performance. On the other side of the spectrum, Managed Futures, Commodity Trading and Global Macro had a difficult quarter, mostly driven by unresolved political issues, leading to increased noise around fundamental prices.

During the third quarter, ALTIN continued to cautiously increase the risk of the portfolio by reducing the Managed Futures, Protection Strategies and Multi Strategy allocations, while in parallel marginally increasing the allocation to risk-seeking strategies. At 115.96% vs. 125.9% at the previous quarter's end, leverage was slightly reduced during the quarter.

Top contributors YTD as 30.09.2013 (estimated data)

• Two Sigma Compass Enhanced Cayman Fund Ltd: +1.11%
• Arrow Offshore Ltd: +0.85%
• LAMP Funds (Ire) 1 plc - LAMP Hayman Capital Fund: +0.79%

Top detractors YTD as 30.09.2013 (estimated data)

• LAMP Funds (Ire) 1 plc - Capstone Convexity Fund: -0.37%
• Stratus Feeder Ltd: -0.35%
• Bluetrend Fund Limited: -0.27%

ALTIN: Continuing to gradually move down the liquidity curve

The improvement in market dynamics and the reduction of tail-risk, coupled with a very appealing opportunity set, allow ALTIN to continue to take advantage of its stable capital base to invest in less liquid strategies with higher expected returns. This allocation shift continues to be implemented gradually.

Asset Allocation according to redemption frequency as 1st October 2013

ALTIN: not affected by redemption issues

ALTIN is a closed-ended and fixed capital fund and as such it is not faced with redemption requests. This provides the investment manager with the opportunity to select the best risk/reward opportunities in the hedge fund universe. Investors can freely buy and sell ALTIN shares on a daily basis on the London or Swiss stock exchanges, without the need to redeem at fixed redemption dates.

Positive effect of share buyback on NAV

At the end of September 2013, ALTIN completed the announced 10% capital reduction via the repurchase of its own shares through the issuance of put options. The buyback added liquidity to the shares and provided a welcome boost to the share price. The repurchased shares, which were acquired at a discount to NAV, will be cancelled at the next AGM, thereby boosting YTD performance to 6.66%[3].

[1] Estimated NAV performance as at 30 September 2013

[2] ALTIN’s gross exposure stands at 115.96% as at 1 October 2013, vs. 125.9% as 1 July 2013.

[3] Estimated NAV performance as 4 October 2013 (based on NAV computed on 10 October 2013).

For further information, please contact: