The investment strategy of an investment manager is subjected to changes

• The portfolio and the strategies for the management of the underlying fund may be altered by the investment manager.  The investment manager is generally not limited to the types of strategies he employs and may develop new strategies at any time.  Moreover, the investment strategy may depend on the composition of the investment manager which may also be subject to fluctuations.  Changes of strategy and staff may have a material adverse effect on the value of the portfolio.

Market risk

• The markets in which the underlying fund invests may prove to be highly volatile from time to time as a result of, for example, sudden changes in government policies on regulations and currency repatriation or changes in legislation relating to the value of foreign ownership in companies, and this may affect the net asset value at which the underlying fund may liquidate positions to meet repurchase requests or other funding requirements.

Interest rate risk

• The net asset values of securities held by the underlying fund tend to be sensitive to interest rate fluctuations and unexpected fluctuations in interest rates could cause the corresponding net asset value of the underlying fund’s positions to move in directions which were not initially anticipated. To the extent that interest rate assumptions underlie the hedge ratios implemented in hedging a particular position, fluctuations in interest rates could invalidate those underlying assumptions and expose the underlying fund to losses.

Exchange rate considerations

• The net asset value of the underlying fund could be adversely affected not only by hedging costs and changes in exchange rates, but also by local exchange control regulations and other limitations, including currency exchange limitations and political and economic developments in the relevant countries.