ETFs (Exchange Traded Funds) Based Investment Portfolio Management

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• ETFs (Exchange Traded Funds) Based Investment
  Portfolio Management

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Why Should you invest in ETFs?

• PERFORMANCE
• LOW EXPENSES
• TAX EFFICIENCY
• TRADING FLEXIBILITY
• DIVERSIFICATION
• TRANSPARENCY

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PERFORMANCE

• Close to 100 of portfolio managers and
  traditional do NOT reach their benchmark (index)

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A model of active manager returns

• Properly measured, the average actively managed
  dollar must under-perform the average passively
  managed dollar, net of costs
• Bill Sharpe, The Arithmetic
  of Active Management

Before fees and costs
After fees and costs
5.5
4.5
GoodManagers
Benchmark Mgr. Avg.
Benchmark Mgr. Avg. -1
BadManagers
Core-002
-5.5
-6.5
Source Sharpe, Arithmetic of Active
Management, Financial Analyst Journal, Jan-Feb,
1991. Waring, Whitney, Pirone and Castille,
Optimizing Manager Structure and Budgeting
Manager Risk, Journal of Portfolio Management
25, Spring 2000.
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LOW EXPENSES

• Average active fund category 1.52
• Average ETF
• 0.29

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TAX EFFICIENCY

• For various technical reasons, the tax
• comparison is always at the advantage of the
  ETFs.
• The advantage is depending on the local tax law
  relevant for the investor.

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TRADING FLEXIBILITY

• One share One market
• Buy and sell continuously during markets hours
• Limit orders
• Stop orders
• Short orders
• Options

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ETFs Ideal Diversification Tool

• Diversification at each ETF level
• Diversification at the portfolio level
• Asset class allocation
• Regional allocation
• Country diversification
• Sector diversification
• Company profile selection

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TRANSPARENCY

• Transparency at the ETF level
• Easy and transparent access to the portfolio
  individually for each investor

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How is TrackBull managing ETFs Portfolios?

• Individual analysis and advice
• Bank or Broker account
• Country of operations
• Investment structure
• Currency choice
• Asset Allocation

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INVESTMENT HOLDING STRUCTURE

• Individual
• Company

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Bank or Broker account

• Costs matters
• Overall relationship matters too
• New or existing account

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Countries of Operation

• USA
• Switzerland

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The currency choice
US Based Investor US Based Investor
Investment Bond ETF iShares Lehman 7-10 Year Treasury Investment Bond ETF iShares Lehman 7-10 Year Treasury Investment Bond ETF iShares Lehman 7-10 Year Treasury Investment Bond ETF iShares Lehman 7-10 Year Treasury Investment Bond ETF iShares Lehman 7-10 Year Treasury
SELL BUY
Profit Profit 31/12/2004 31/07/2002
14.75 10.58 82.32 71.74
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The currency choice
EUR Based Investor EUR Based Investor
Investment Bond ETF iShares Lehman 7-10 Year Treasury Investment Bond ETF iShares Lehman 7-10 Year Treasury Investment Bond ETF iShares Lehman 7-10 Year Treasury Investment Bond ETF iShares Lehman 7-10 Year Treasury Investment Bond ETF iShares Lehman 7-10 Year Treasury
SELL BUY
Profit Profit 31/01/2004 31/07/2002
14.75 10.58 82.32 71.74
1 EUR 1 EUR
1.3621 0.9783
-17.58 -12.90 60.44 73.33
in 2.5 years only 32.33 Difference
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Asset Allocation

• Initial assets allocation Assets type first.
• Ongoing technical analysis.
• Fundamental analysis, then only.
• Choice among ETFs tracking the same index
  Volume, Spread, Expense ratio, Tracking error,
  specific details.
• Correlation analysis.

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TrackBull management styles
A Cash, Bonds, Bonds funds or Fixed income ETFs all in investors reference currency
B A program plus same investment instruments but in other currencies
C A and B programs plus REITs, REIT's ETFs, utilities ETFs and dividend yielding value stocks ETFs
D A, B and C programs plus all other ETFs Sectors/Countries/Companies Profiles/Assets Rotation

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TrackBull commitment

• Registered Investment Adviser (SEC in the USA).
• Private company, highest confidentiality level.
• Focusing on one niche ETFs.
• Totally independent Our customers are our sole
  and only dedication.

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