Eclipse Capital Management,

Inc. (Gl. Allocation - Prop)

Fund Investment Objectives

The GLOBAL ALLOCATION PROGRAM (GAP) is a tactical, momentum-based, asset allocation strategy. GAP utilizes a quantitative approach that integrates two types of momentum-driven models to dynamically allocate risk across four major asset classes - stock indices, fixed income, currencies and commodities. Long positions in global markets are established using regulated futures contracts. These contracts are traded, cleared, and priced on established global futures exchanges, thereby minimizing concerns with respect to liquidity, counterparty, and valuation risk. The portfolio is monitored daily, and positions are actively adjusted as needed. A top-down, cross-sectional momentum model measures the risk-adjusted returns of over 30 different markets and holds positions in those markets exhibiting the greatest relative strength, subject to constraints limiting the total risk that may be allocated to each asset class. A bottom-up, time-series momentum model is also used to measure each market's return over various time periods, ensuring that positions are only established and maintained in markets that exhibit sufficient upside momentum. The total amount of portfolio risk allocated varies over time, dependent upon the number of markets exhibiting positive momentum and their distribution across asset classes. Returns are based on proforma adjustments to a proprietary account to reflect fees. Client accounts will be traded in like fashion.