Hedge Funds Deliver 50% more then S&P TYD

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The Greenwich-Van Global Hedge Fund Index (the “Index”) returned -0.40% in June (+0.19% 2Q06; +5.82% YTD), according to hedge fund index provider GreenwichVan Advisors, LLC. In comparison, the S&P 500, MSCI World Equity Index and the Lehman Brothers Aggregate Bond Index returned +0.14% (-1.44% 2Q06; +2.71% YTD), -0.18% (-1.13% 2Q06; +4.94% YTD) and +0.21% (-0.08% 2Q06; -0.72% YTD), respectively in June.

“While hedge fund returns in May and June have slowed, the asset class over expanded periods of time continue to present compelling evidence that exposure to hedge funds has proven beneficial,” noted Wade McKnight, Vice President of Greenwich-Van. For example, over the past 6 and 12 months, hedge funds, as represented by the Greenwich-Van Global Hedge Fund Index, have delivered 50% more return than the S&P 500, with much less volatility. Over the past 60 months hedge funds generated over 100% more return than the S&P 500 and MSCI World Equity Indexes, with roughly a third of the volatility.”

Strategy Group Summary
The Market Neutral Group yielded +0.23% in June (+1.69% 2Q06; +6.19% YTD). Many market neutral managers took pleasure in a sudden volatility spike (VIX reached two year high in mid-June) which led to intra-month gains only to give back a portion of such gains after equity markets stabilized later in the month. This caused credit spreads to widen out; however, the spreads reversed later in the month. Meanwhile, the performance of event driven managers in June was flat. The Greenwich-Van Global Market Neutral Arbitrage, Event Driven and Equity Market Neutral Indices returned +0.69%, -0.06% and -0.22% in June, respectively.

The Directional Trading Group, comprised of futures, market timing and macrooriented hedge fund strategies, returned -1.01% in June (+1.45% 2Q06; +4.63% YTD). Futures managers were negatively affected by the increase in volatility which caused widespread risk reduction among portfolios, subsequently causing a decline in overall market activity. Macro managers, who construct their portfolios based upon top down economic trends, ended June virtually unchanged. The GreenwichVan Global Macro, Market Timing and Futures indices returned +0.12%, +0.50%
and -1.70% in June.

The Specialty Strategies Group, comprised of emerging markets, income and multistrategy hedge fund strategies, returned -0.38% in June (+0.27% 2Q06; +7.46% YTD). Emerging Market managers continue to be one of the leading hedge fund strategies on a year-to-date basis; however, their significant long exposure to equities and commodities impeded their ability to generate positive returns in June. The Greenwich-Van Global Income and Multi-strategy indices returned +0.26% and – 0.40%, respectively.

The Long/Short Equity Group returned -0.56% in June (-1.45% 2Q06; +5.38% YTD). Equity based hedge funds collectively delivered basis point losses affected primarily by the continued global equity market decline which began in May and continued into June. Most traditional benchmarks were in negative territory throughout June until the last couple of trading days, at which point many markets rebounded strongly. Many equity managers had reduced exposure towards the end of June and were not able to fully participate in the broad market rally near the end of the month. Greenwich-Van’s Global Short Selling, Value, Opportunistic and Aggressive Growth Indices returned +0.81%, -0.59%, -0.62% and -0.67%, respectively.

Greenwich-Van Investable Index
The Greenwich-Van Investable Hedge Fund Index returned -0.69% in June (-0.96% 2Q06, +3.90% YTD). The Investable Index, comprised of 51 funds, adds investability, active management and liquidity to the diversification and performance benefits of the broad Greenwich-Van Global Hedge Fund Index. Since its inception January 2003, the Investable Index achieved an annualized return of 10.27% versus 11.58% for the Greenwich-Van Global Hedge Fund Index. Cumulatively from inception through June the investable index has gained 40.81% compared to
46.75% for the non-investable index. Its correlation of 0.95 and Beta of 0.91 to the
Greenwich-Van Global Hedge Fund Index further demonstrate the Investable Index’s
ability to track the hedge fund universe. The Investable Index is reported monthly
net of a 0.04% Index calculation fee. Past performance and Greenwich-Van Hedge
Fund Indices construction rules may be viewed at www.vanhedge.com.

Greenwich-Van Advisors, LLC manages one of the world’s largest hedge fund databases and is among the oldest providers of hedge fund indices and research to institutional investors worldwide.

Accuracy of compiled information reported by managers is not audited or independently verified and may not represent all hedge funds. Greenwich-Van does not necessarily perform due diligence on reporting managers. Hedge fund returns are net of underlying fees and performance allocations. Timing of fee and performance allocations may affect the reported performance. Averages are equally weighted. Past results are not indicative of future performance.

GREENWICH, CT, USA, July 3, 2006 – The volatile swings experienced in U.S. equities during June has caused macro mangers to become divided in their outlook for July, as 35% anticipate the S&P 500 will end the month lower vs. 30% higher and 35% unchanged. With respect to the U.S. Dollar a slight majority, 53%, expect the Dollar to end the month lower vs. 6% unchanged and 41% higher. Finally, the group is divided on their outlook for U.S. Treasury 10-year prices, as 41% expect the 10-year to move lower in July vs. 24% unchanged and 35% higher.

The Greenwich-Van Macro Sentiment Indicators are based on the outlook of hedge fund managers employing a macro view and who manage, in aggregate, in excess of $30 billion in assets. The purpose of the indicators is to reveal how these managers believe the S&P 500, the U.S. Dollar and the U.S. Treasury 10-year Note
will perform over the current month.

Greenwich-Van is a leading hedge fund investment advisor and provider of global hedge fund indices, research and index-linked products and services to investors worldwide. Founded in 1992, Greenwich-Van was the first to perform large-scale research on the hedge fund universe and quickly became recognized as an alternative investments pioneer. Further information is available at www.vanhedge.com or Bloomberg VAN ‹GO›.

Greenwich-Van Advisors attempts to be accurate in providing the Indicator information but does not guarantee its accuracy. The Indicators above are provided solely as information on the thinking of a group of hedge fund managers. They are not intended as guides to investing decisions. Investors invest at their own risk.