Stonebrook Capital Management, Inc.

FX Carry Program (2.5X)

Program Description: Stonebrook's trading philosophy is to add value to client portfolios while adhering to volatility control and risk management principles through the speculative trading of commodity interests, including foreign currencies. Stonebrook's trading is a blend of technical and fundamental techniques. Stonbrook uses technical analysis to time trades and identify price changes that might indicate unheralded changes in market fundamentals or sentiment. Stonebrook makes extensive use of computer-based studies to characterize various timing techniques and to investigate recurring or analogous market events. Stonebrook monitors monetary, fiscal, and political developments in various countries in order to identify potential supply/demand imbalances that could lead to profitable trading opportunities. Pro forma results from January 1998 through May 2004 are net of a 2% management fee, 20% performance fee and slippage. Performance results beginning in July 2004 are extracted from the Stonebrook FX Program and are net of all fees. The Stonebrook FX Carry Program (FXC) is an absolute return strategy that exploits the fundamental relationship between interest rates and exchange rates. Uncorrelated with CTAs and other trading strategies, it adds exceptional value to alternative investment portfolios. FX Carry profits from the returns inherent in owning high-yielding currencies financed with low-yielding currencies. The strategy not only performs in benign markets, but in risky conditions as well. Stonebrook’s FX Carry program adds value by identifying periods when investors tend to liquidate their risky holdings. By using forward-looking risk controls based on fundamental inputs across asset classes, FX Carry profits from spot exchange rate changes when investors flee from risk.