Micromegas Fund

Fund Investment Objectives

Exane Micromegas Fund is small/mid-cap Long/Short equity fund (up to EUR 5 billion of capitalization). The Fund will invest on world markets, with a principal emphasis on the European markets. The Fund's objective is to achieve regular and absolute performance uncorrelated to financial markets. The management philosophy is stock picking among European companies whose market capitalization does not exceed 5 billion Euros. The approach is fundamental analysis combining valuation and profit/growth outlook. Stock selection emphasizes event driven considerations: 1) changes expected in the shareholder structure, 2) business portfolio, 3) management, and 4) strategy or policies regarding the shareholders. Depending on the opportunities that arise in this particular investment universe, which is by definition more volatile than the large-cap universe, portfolio rotation can be very high, as can be the degree of market exposure. The number of portfolio lines should vary in a range between 30 and 40.