Exponential Investment Club Fund Summary

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description

Fund Summary 2012

Transcript of Exponential Investment Club Fund Summary

Page 1: Exponential Investment Club Fund Summary
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Table of Contents

1.0 Investment Objective ...................................................................................................................... 3 2.0 Fees and Expenses .......................................................................................................................... 3 3.0 Principal Investment Strategy ......................................................................................................... 3 4.0 Principal Investment risks ............................................................................................................... 4 4.1 Liquidity Risk ......................................................................................................................... 4 4.2 Management Risk ................................................................................................................. 4 4.3 Market Risk Risk .................................................................................................................. 4 4.4 Regulatory Risk ................................................................................................................. 4 5.0 Performance ................................................................................................................................... 5 6.0 Calendar year total returns ............................................................................................................ 6 7.0 Fund management .......................................................................................................................... 6 8.0 Transaction policies ........................................................................................................................ 6 9.0 Terms and Conditions ................................................................................................................ 7-12

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Thank you for taking time to pick up this fund profile.

Now with the niceties over let’s get to the point on how YOU the

Investor is hoping to make a return on your money. These days

many Investors are more cautious than ever to invest. Ponzi

schemes are being caught left, right and centre. The economies

of countries seem to be hanging by a thread and the biggest

investment banks are being caught at finding cleverer ways of

ripping everyone off. The cautious investors then decide to invest

in the most conservative financial instruments like Government

Bonds; which is better than putting it in a shoe box, but with

inflation at 5%, their money is still deteriorating.

Information overload is also playing a part to many bad

investment decisions these days. I truly believe that the main reason why many modern Investors

are not as successful as their predecessors is because of the Internet. Now on the internet you’re

marketed with very specific adverts about where, how and when you should invest your money.

Reuters, Wall Street Journal and Investors Chronicle right at your fingertips with analysts, PhDs and

economic doctors sharing their investment strategies and their predictions on the future of

Capitalism. The internet is a wonderful invention; but it has confused many Investors on which

strategy to choose, where they should invest their money, whether or not they should diversify etc.

Apart from becoming rich, the other reason why I formed this Fund is to show the world that trading

and investing isn’t as difficult as most people think. All that a person has to do is to pick a strategy

that suits their personality, have strict money management rules and stick to the strategy thick or

thin. That is it! But most people these days lack the patience and discipline to do that, hence why

only few investors are successful in the long-term. You have to deal with a little pain to reach the

summit and most people don’t have the discipline to deal with the pain.

The philosophy (if you could call it that) of sticking with a trading strategy through thick and thin has

rewarded me financially as well as my investors. That is the reason why our Fund is managed with

that exact same strategy and that strategy alone.

In this booklet you will find information on our fund and to see if it is right for you. If you would like

more information then please contact us (contact details are on the back cover). Whether or not you

wish to invest with us, we wish you long term financial success.

Faithfully,

Paul Gedrimas

CEO Exponential Investment Club

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Fund Summary

1.0 Investment objective The fund seeks total return on capital, high level of capital appreciation. EIC uses historically backed trading strategies as well as conservative money management strategies during very profitable streaks as well as drawdown periods.

2.0 Fees and Expenses

The tables below show the expenses paid when you invest with Exponential Investment Club.

* The total expenses from the fund come only from the performance fee; therefore expenses will only be

withdrawn if the fund has had a positive return in the fiscal year.

3.0 Principal Investment Strategy Exponential Investment Club (acronym EIC) is a trading firm which solely trades in the currency

market. The sole strategy is a trend trading strategy, which means that the traders of the fund catch

big long-term price trends, either to upside or downside.

The currency market is by far the biggest market in the world and the most liquid. Spread prices and

transaction fees paid to the brokerages are (on average) lower than stocks, bonds and commodities.

Because markets move sideways for variable durations throughout the year, the investor has to

understand that his initial investment may enter temporary drawdowns.

Even though our fund does use fundamental analysis for very big events in the financial calendar

(Interest Rates, Payroll Rates, Unemployment rates etc.), our traders are professional technical

analysts and therefore their trading strategies are more focused on the current price data, past

market data and volume to determine when to enter and exit trades.

Management fee 0.00%

Performance fee 20%*

Other Expenses 0.5%

An example of a large long-

term trend that was bought

before it started trending.

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4.0 Principal Investment risks

4.1 Liquidity Risk if the investor decides to withdraw his capital from the fund, the current trades

which the investor’s capital may be in may not be sold at the desired time due to adverse effects on

price

4.2 Management Risk There is no guarantee of the Fund's performance or that the Fund will meet

its objective. The market value of your investment may decline and you may suffer investment loss.

4.3 Market Risk The market price of securities owned by the Fund may rapidly or unpredictably

decline due to factors affecting securities markets generally or particular industries.

4.4 Regulatory Risk Changes in government regulations may adversely affect the value of a

security. An insufficiently regulated industry or market might also permit inappropriate practices

that adversely affect an investment.

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5.0 Performance

The following information provides an indication of the risks involved with Investing with

Exponential Investment Club by showing how the rate of return changes from year to year. The

returns of EIC are compared to various indices. Past performance is no guarantee of future results.

The chart shows the performance of an initial deposit of £1,200,000 made by a private investor.

£0.00

£500,000.00

£1,000,000.00

£1,500,000.00

£2,000,000.00

£2,500,000.00

£3,000,000.00

£3,500,000.00

£4,000,000.00

£4,500,000.00

£5,000,000.00

Jan

-07

May

-07

Sep

-07

Jan

-08

May

-08

Sep

-08

Jan

-09

May

-09

Sep

-09

Jan

-10

May

-10

Sep

-10

Jan

-11

May

-11

Sep

-11

Jan

-12

May

-12

Exponential Club

FTSE 100

NYSE

£993,480

£1,108,648

£4,357,392

-

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6.0 Calendar year total returns (12 month/31 day)

7.0 Fund management

Portfolio Manager Title Managed since

Matt Cinaitis Chief Financial Manager 2007 (When Exponential Investment Club was an Investment Club (not a fund))

Paul Gedrimas Fund Manager (CEO) 2007 (When Exponential Investment Club was an Investment Club (not a fund))

8.0 Transaction policies

To invest or withdraw capital

Minimum capital investment: £500,000 (€600,000 $750,000)

Telephone: +44 (0)207 470 9241 Email: [email protected] Website: exponentialclub.com

Minimum additional investment: £100,000 (€100,000 $100,000)

Contact your investment representative

-100.00%

-50.00%

0.00%

50.00%

100.00%

150.00%

2007 2008 2009 2010 2011

Chart Title

EIC

FTSE

NYSE

-2.2

5%

-3.2

5%

-0.4

7%

101.

61%

-34.

21%

-33.

99%

-49.

32%

37.6

4%

22.8

7%

138.

28%

9.64

%

11.0

4%

53.4

8%

-8.0

0%

0.49

%

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9.0 Terms and Conditions

1. Fund Name Exponential Investment Club

2. Fund Manager’s Head Office Address and further information Exponential Investment Club Registration number is 7911964 and whose registered address is at 14 Heddon Street Mayfair London W1 4ED Information about the Fund can be found at the Fund Manager’s website: www.exponentialclub.com

3. Commencement The Fund has already commenced accepting subscriptions (when it was an investment club) on January 2007.

4. Date of issuance of these Terms and Conditions The Fund’s original Terms and Conditions were issued on January 2007 (as an Investment club) and updated in 17 January 2012 when Exponential Investment Club became a private limited company.

5. Minimum Investment The minimum initial subscription is £500,000 (€600,000 $750,000). Subsequent subscriptions must be in an amount of at least £100,000 (€100,000 $100,000) but don’t need to be in exact multiples of £100,000(€100,000 $100,000).

6. Fund Currency The Fund is denominated in Pounds Sterling, Euro and American Dollar

7. Fund Objectives To provide income and competitive returns, capital preservation and liquidity through investing in the currency market.

8. Principal Investment Strategies 1. Instil a trend trading strategy 2. Wait for breakouts in in sideways markets to hopefully ride trends 3. Not have more than 3% of the Investor’s total capital on any one trade. 4. Strive to achieve a risk/reward ratio of more than one.

9. Principal risks of investing in the Fund The Fund is considered a medium to high risk investment fund that delivers competitive short to medium term investment instruments kind of returns. Unit’s value and related returns is subject to fluctuation due to fluctuation in the currency markets.

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An Investor must be aware that he or she may lose money if at the time of selling the units, the value of the units is less than what was originally invested. There can be no assurance that any appreciation in the value of the Fund’s underlying investments will occur. The value of the Fund’s underlying investments and the income derived from them may fall as well as rise and Investors may not recoup the original amount invested in the Fund. There is no assurance that the investment objectives of the Fund will actually be achieved. Past performance is not a guide to future growth or rates of return. Potential Investors should consider the following risk factors before investing in any Fund. An investment in the Fund is subject to normal market fluctuations as well as other economic, political or financial developments.

A. Liquidity Risk Liquidity of investments may be low in some periods and as a result this may increase the difficulty of valuing such investments. Reduced market liquidity may adversely affect the market price of the Fund’s investments and the Fund’s ability to dispose of particular investments to meet its liquidity requirements. This risk may be mitigated through utilizing the available cash portion of the Fund. However if total redemptions exceeds 10% of the Fund’s Value, the Manager has the right to postpone such redemptions to the next Valuation Day. Such redemptions will be accounted for on a prorate basis. An investment in an investment fund is not a deposit with any local bank sponsoring, selling, or otherwise affiliated with the investment fund. Unit holders bear a risk of loss of money in the investment fund, since the investment value may increase or decrease. Investors in the Fund are not certain to make a profit and may suffer a loss, and therefore may not recover their fully-invested capital. Subscribers should only invest in this Fund if they are able to sustain a loss. Investors in the Fund should be aware of the risks in investing in the Fund and, if they are in any doubt as to the suitability of the Fund, should consult an independent financial advisor.

10. Fees and Expenses A. Performance Fees The Manager charges the Investor a 20% performance fee every year (every 12 months after the first investment). This would only occur if the fund made a positive return that financial year.

B. Other Expenses The Fund Manager reserves the right to recover from the Fund any other expenses incurred on behalf of the Fund such as custody, data processing, accounting audit and other similar charges acceptable by the authorities. However, other expenses are not expected to exceed 0.50% from the Fund’s NAV

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11. Fund Board The Fund Board consists of the following members who will serve for a period of three (3) years and will begin their duties after your first Investment. 1. Paul Gedrimas (Fund Manager) 2. Matt Cinaitis (Chief Financial Manager)

The Fund Board’s duties include, but are not limited to, the following: 1) The approval of all Funds’ material contracts, reports and decisions. 2) Overseeing, and where appropriate, ratifying any conflict of interest the Fund Manager has identified in accordance with the Investment Funds Regulations. 3) The approval of any recommendations made by an appointed liquidator. 4) The responsibility to ensure completeness, accuracy and compliance with the regulations of the Terms and Conditions. 5) Ensuring the Fund Manager carries on his obligation in the best interest of the unit holders, in accordance with the Terms and Conditions of the Fund and with the Regulations. 6) To act in the best interests of the investment Fund and its Unit holders and carry out its duty of loyalty and duty to exercise reasonable care. The Fund Board members will be compensated for their services by the Fund.

12. Financial Statements Annual financial statements will be made available within 90 days after the Fund’s fiscal year, without any charges to the Unit holders and customers, upon request made to the Manager. Statements will be available by both electronic mail and regular mail.

13. Confidentiality Strictest confidentiality shall be observed at all times in the handling of the business of the Fund and the Fund’s Investors.

14. Subscription and Redemption Procedures The Fund is open for subscription, redemption and valued every UK Business Day.

A. Subscriptions All subscriptions paid in Pounds Sterling, Euros or US Dollars Payments must be made at or before 4:00 PM on the Subscription Day in order to commence participation in the Fund from the Subscription Day. Other forms of subscription payments such as cheques and transfers may require additional time for clearing and collection and participate in the Fund only from the Dealing Day following receipt by the Fund. Applications made after 4:00 PM for (telephone and internet) will participate in the Fund from the following Dealing Day. If the subscription payment falls at the beginning of an official UK Holiday, it will be invested in the Fund the following Dealing Day.

B. Redemptions Redemption is allowed on every Dealing Day provided that a written notice is received at or before 4:00 PM on the Dealing Day. Redemption proceeds are made available on the third UK Business Day

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after the Dealing Day. Redemption of units must be for minimum value of £2,000(€2,000 $2,000). However, redemption transactions made through alternative distribution channels such as calling the fund’s office may allow the investor to withdraw smaller values. If the Dealing Day falls on a non UK business day, it will be redeemed on the following Dealing Day. Redemption amounts are made available to the investor in a period of not more than three days after the dealing in which redemption has been made.

C. Subscription Procedures The Investor is required to sign a copy of these Terms & Conditions and complete an Investment Account Application Form. If the Investor already has an investment account with the Company, an Application Form is not required. These forms should be submitted to a designated staff member and a copy will be returned to the Investor as a receipt. The Investor is required to provide identification in the form of a valid ID (EU/EEA/Swiss Citizens), a valid EU driving licence, national ID or a valid passport. (non-EU/EEA/Swiss residents), a valid passport or a signed board resolution, stamped with the company seal and a copy of the company’s commercial registration for Corporate Investors.

D. Rejection of Application The Fund Manager reserves the right to reject any application /subscription if he believes that such subscription may result in a violation of Fund’s regulations and/or applicable regulations including the Terms and Conditions of the Fund.

E. Redemption Procedures Application for redemption will be made by the Investor in whole or in part at any time by completing and submitting a Redemption Form. For identification purposes, an Investor’s valid Identification Card or passport must be made available and its number noted on the Redemption Form. The Investor must specify whether the redemption is complete or partial. In case of a partial redemption, it is important to note that should the Investor’s balance decline on Dealing Day (due to decline in unit price), the redemption process will not be executed. This is, without liability to the Fund Manager. In such case, the Investor must submit a new redemption request in the next dealing day.

15. Fund Manager Investment in the Fund The Fund Managers may at their discretion participate in the Fund as an Investor. The Fund Manager reserves his right to reduce in part or in whole its participation whenever it deems appropriate.

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16. Fund Termination The Fund Manager retains the right to terminate any Fund without penalty to any party involved by giving not less than 60 days’ written notice. In such case, the relevant Fund’s portfolio shall be liquidated and the net proceeds shall be distributed to the Investors.

17. Reporting to Investors The Manager will issue a confirmation to each Investor when such Investor subscribes or redeems capital in the Fund. A statement detailing each Investor’s position is issued every four months or as determined by the Manager (however not more than 4 Months). Statements to Investors are sent to the mailing address shown on the Application Form, unless notification of a change of address has been provided in writing. Any discrepancies must be brought to the attention of the Company within sixty (60) days of the date of issuance of such statements and confirmations, after which the statements issued by the Manager will be final and conclusive and the Manager shall not be liable to Investors in connection with any discrepancy. The Manager shall not be liable for any consequences arising from statements or confirmation advices that are held by the Company on the instructions of the Investor.

18. Voting Rights Policies After consulting with the Compliance Officer, the Fund Board approves the general policies of practising the Fund voting rights. As a policy, the Manager may practice the voting rights (if any) for the securities held by the Fund’s.

19. Changes to the Terms and Conditions These Terms & Conditions shall remain in effect until such time as they are materially amended by the Manager, and a written notice will be given to the Investors before 60 days.

20. Complaints Procedure A copy of the Fund Manager’s policies and procedures for handling customer complaints is available upon written request being given to the Fund Manager.

21. Governing Law These Terms & Conditions are governed by the laws of the Cayman Islands If an Investor is subject to the laws of a jurisdiction other than that of the Cayman Islands, then it is the Investor’s responsibility to conform to those laws without any obligation on the part of the Fund or the Manager.

22. Appendices The following appendices are an integral part of the Terms and Conditions: • Investment Restrictions • Summary of Financial Disclosure • Fund’s Historical Performance

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23. Responsibilities 23.1 Fund Manager’s Responsibilities The Fund Manager is responsible for the overall management of each Funds’ Investment and related activities. The Fund Manager may also enter into arrangements with other institutions for the provision of investment, custodian or other administrative services.

23.2 Investor’s Responsibilities Acceptance of the Terms and Conditions by each Investor constitutes such Investor’s authorizations to the Fund Manager to invest the Subscription Monies in the relevant Fund and confirms such Investor’s acceptance that the risk inherent in the relevant Fund resides with such Investor, and not with the Fund Manager.

23.3 Money Laundering As a result of legislation in force in Cayman Islands to prevent money laundering, persons conducting investment business are responsible for compliance with money laundering regulations. Accordingly, in certain circumstances Investors may be asked to provide proof of identity in a form satisfactory to the Fund Manager when buying, selling, switching, or redeeming Units and, until satisfactory proof of identity is provided, the Fund Manager reserves the right to refuse to sell, redeem or switch Units or to delay processing and/or withhold any payments due to Investors in respect of their investment and to discontinue any deals it is conducting on behalf of those Investors. The Fund Manager also reserves the right to request additional information or proof of identity, in

order to validate any element of a transaction and to comply with any relevant money laundering

regulations

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