Risk Disclosure Statement

General Risks

• Loss of Capital: Systematic strategies may result in partial or total loss of capital allocation.
• No Guarantee of Returns: Past performance does not predict future results. Historical returns may not be replicated.
• Lock-Up Period: 1-year minimum commitment period. Early withdrawals not permitted.
• Limited Redemption Windows: Annual redemption only, with 90-day advance written notice required.
• Illiquidity: No secondary market exists. Capital remains committed until redemption dates.

Market Risks

Our strategies are subject to various market risks:

• Market Volatility: Asset prices can fluctuate significantly.
• Currency Risk: Exposure to foreign exchange rate movements.
• Interest Rate Risk: Changes in interest rates may affect valuations.
• Counterparty Risk: Risk of default by trading counterparties.

Strategy-Specific Risks

• Leverage Risk: Maximum combined leverage of 3x NAV across diversified algorithmic strategies. Leverage amplifies both gains and losses exponentially.
• Model Risk: Proprietary algorithms may fail during unprecedented market conditions. Historical backtesting does not guarantee live performance.
• Short Selling Risk: Unlimited theoretical loss potential on short equity positions. Market rallies can force position closures at significant losses.
• Derivatives Risk: Futures, options, and complex instruments used extensively. Counterparty default, margin calls, and forced liquidations possible.
• Algorithmic Execution Risk: System failures, connectivity issues, or exchange outages may prevent timely trade execution or risk management.

Cryptocurrency Risks (Bitcoin Exposure)

Bitcoin strategies carry heightened risks:

• Extreme Volatility: Bitcoin frequently experiences 20-50% drawdowns. Intraday price swings of 10%+ are common.
• Regulatory Risk: Government bans, exchange restrictions, or adverse regulation can cause price collapse. Legal status varies by jurisdiction.
• Custody Risk: Hot wallet storage (required for trading) exposes assets to hacking, theft, or technical failures. No FDIC insurance. No recovery if private keys are lost.
• Exchange Counterparty Risk: Crypto exchanges can be hacked, go bankrupt, or freeze withdrawals (e.g., FTX, Mt. Gox precedents).
• Market Manipulation: Crypto markets are less regulated. Wash trading, spoofing, and pump-and-dump schemes exist.
• Liquidity Risk: During extreme volatility, bid-ask spreads widen dramatically. Slippage on large orders can be severe.
• No Intrinsic Value: Bitcoin has no cash flows, dividends, or fundamental anchor. Price is purely speculative.

Operational & Cybersecurity Risks

Prime Brokers & Custodians: The Fund utilizes multiple brokers across asset classes:

• Equity Trading: Interactive Brokers, Alpaca Markets
• FX Trading: IC Markets, RoboForex, RoboMarkets, Interactive Brokers
• Cryptocurrency: Binance, Kraken, Interactive Brokers (100% hot wallet storage)

• Technology Risk: Trading systems, data feeds, or algorithms may malfunction. Backup systems may fail simultaneously.
• Cybersecurity Risk: Hacking, phishing, ransomware, or DDoS attacks could compromise trading systems, steal assets, or cause operational shutdowns.
• Broker/Prime Broker Risk: Broker insolvency, margin call disputes, or segregation failures could result in asset loss despite diversification across multiple brokers.
• Exchange Risk (Crypto): Cryptocurrency exchanges (Binance, Kraken) may face regulatory investigations, service restrictions, liquidity limitations, or insolvency.
• Service Provider Risk: Dependence on third-party administrators, custodians, auditors, and legal counsel. Their errors or failures directly impact operations.
• Key Person Risk: Strategies rely heavily on specific individuals' expertise. Death, disability, or departure of key personnel could impair performance.

Regulatory & Jurisdictional Risks

Dual-jurisdiction structure involves specific regulatory exposures:

• Regulatory Change Risk: Changes in US (SEC, CFTC) or UAE regulations may restrict trading strategies, increase compliance costs, or force structural changes.
• Tax Law Changes: Modifications to US partnership taxation, UAE corporate tax, or double taxation treaties could materially impact returns.
• Jurisdictional Risk: Legal disputes may require resolution in Delaware courts (US) or UAE commercial courts. Enforcement across jurisdictions can be complex and costly.
• Compliance Risk: Failure to comply with AML/KYC regulations, accredited investor verification, or reporting requirements could result in penalties, forced redemptions, or legal action.

Tax Considerations

Investment returns may be subject to taxation. Investors should consult with their tax advisors regarding the tax consequences of investing.

Performance Disclaimers

Performance data presented represents past performance and is not indicative of future results. Individual investor results will vary based on timing of investment, fee structures, and market conditions.

Fee Structure & Performance Impacts

• Performance Fee: 20% of net new profits above high-water mark. Reduces net returns to participants.
• No Management Fee: Unlike traditional structures, zero annual management fee. Manager compensation tied solely to performance.
• Volume Rebates: Manager retains all trading volume rebates. These are not passed through to participants.
• Dividend Income: Manager retains 100% of dividend income from equity holdings. Not distributed to participants.
• Profit Allocation Timing: Performance fees calculated and deducted before participants receive distributions, reducing actual cash received.