Summary

-The Trading Programme This document describes The Global Resources Programme, which trades in a wide range of US and other global futures markets with the primary objective of substantial long-term capital appreciation. A principal feature of The Global Resources Programme is its bias towards the physical commodity sector of approximately 60%, thus exploiting and maximizing the benefits deriving from the relationship between global resources and the economic fundamentals which drive financial markets. While this programme trades in up to thirty (30) futures markets at any one time, we reserve the right to trade any legally recognised financial product that currently is or hereafter may become available without providing clients with prior notice. Technical Trading System The Global Resources Programme was designed and proved out between 1991 and 2005 using purely historical data, providing a materially accurate hypothetical performance history based on a limited number of quantifiable assumptions such as intra-day movements, "limit" movements and execution slippage. Unlike many trading systems, the model neither relies on an ex-ante nor is it a curve-fitting mechanical optimization model. Rather, it relies on a post-ante. Thus, the validity of the model is necessarily much greater, based as it is on over twelve (12) years' historical data. Being free standing, the system does not suffer from inherent instability and relies on no assumptions or predictive variance going forward. A risk management module has been made and back-tested in the light and experience of single catastrophic event impact on markets such as the events of September 11 2001, the Enron debacle, the Afghan and Iraq wars, the bursting of the technology bubble, the sustained period of historically low interest rates and consequent low-liquidity, highly volatile markets. The system is designed to exploit the price relationship between economic fundamentals and global resources, with the aim of capturing price trends while detecting and excluding historically uncharacteristic, erratic and volatile market movements. Approximately fifty (50) different futures markets were analyzed using three (3) criteria to establish the fundamental of the algorithm: 1. a proprietary "risk: volatility" formula calculated as a ratio of average intraday volatility for each market over up to twelve (12) years related to its contract value and historic trend potential; 2. a proprietary formula determining the width of each market's "trading envelope" based on historic volatility and 3. a proprietary signal strength confirmation indicator, with the objective of preventing the programme from opening positions either before the price trend is properly established or where excessive volatility is detected. As in any trend-following programme, the objective is to participate in major price trends - sustained price movements either up or down, but at the same time avoiding price spikes, which in our experience are indicative of historically uncharacteristic volatility and are seldom captured. While it is clearly necessary in a trend-following programme to be "in" a market as often and for as long as possible to achieve maximum benefit from a trend, it is not desirable to enter and exit too frequently while attempting to identify an emerging trend, nor to enter a market too long after the trend is established. Every market has a different "signature," or profile, that affects both the "risk: volatility" ratio and the size of the trading envelope. To this end, the combination of our proprietary "risk: volatility" formulae, trading envelopes, signal strength indicators and volatility circuit-breakers aims to allow the programme to achieve maximum market participation combined with minimum trading frequency. This strategy is based on making sufficiently large profits from the trends that are identified and followed to generate overall profits despite the occasional losses incurred on positions taken by the system. Diversification of Sectors and Markets The Global Resources Programme trades across seven (7) market sectors - soft commodities, energy products, base and precious metals, grains, currencies, government bonds, and short-term interest rates - on major international Recognized Investment Exchanges. There is no way to predict which markets we will trade or what our relative commitments to the different markets will be. However, as at 31st May 2005 the Programme had the following approximate market sector weighting: Softs 14% Metals 14% Energy 23% Grains 12% Currencies 9% Bonds 12% Interest Rates 16%