TORONTO, Dec. 21 /CNW/ - The Northwater Five-Year Market-Neutral Trust
announced today that the net asset value of the Trust per unit as of November
30, 2007 was $21.82. The return of the Trust for the month of November is
estimated at -1.05%. The rolling 12-month return for the Trust is estimated at
The Trust previously announced that it had declared a regular quarterly
distribution to be payable to unitholders of record on December 31, 2007 that
is $ 0.4375. This distribution is expected to be paid on January 15, 2008. In
addition the Trust is required to distribute all of its net income and
realized capital gains, so that the Trust will not be liable to pay income tax
under Part I of the Income Tax Act. The Trust cannot, therefore, finalize the
amount of the distribution declared until all of its net income and realized
capital gains for 2007 have been ascertained. It is not currently anticipated
that any such additional special distribution will be required for 2007.
However, if such a special distribution is required to be made after the
Trust's net income and realized capital gains for 2007 have been ascertained,
the special distribution is expected to be paid on January 29, 2008 to
unitholders of record on December 31, 2007. The final character of the
distribution for tax purposes and the amount will be determined in accordance
with the agreement establishing the Trust and in accordance with the Income
Tax Act (Canada).
The Trust, through a forward purchase and sale agreement, has exposure to
approximately 150% of a portfolio of market-neutral hedge funds held by
Northwater Five-Year Market-Neutral Fund Limited (the "Fund"). For the month
of November, 15 of the Fund's 38 hedge funds posted positive returns, while 4
of the 12 market-neutral strategies included within the Fund's portfolio added
to the bottom line. Specifically, the Trust's asset-backed securities managers
in aggregate were the largest contributors to the estimated return of the
Trust for the month.
The Fund relies on estimates provided by administrators of each of the
Fund's underlying hedge funds. Occasionally, these estimates may be revised
and the Fund will be required to capture these revisions in subsequent net
asset value calculations. The net asset value of the Fund is also affected by
the finalization of the net asset value by the administrators of the
underlying hedge funds. Ultimately, the net asset value of the Fund impacts
the reported net asset value of the Trust and, accordingly, the Trust
indirectly relies on the estimates provided by administrators of each of the
Fund's underlying hedge funds.
The Fund's exposure to a fixed interest rate swap increased the Trust's
return as the interest rate environment was favourable to the Trust over the
Subject to the limits set out in the Trust's prospectus, the Trust is
required to purchase its units in the market in the event that the market
price of a unit of the Trust falls below 95% of the net asset value of the
Trust per unit. The Trust also makes purchases of its units pursuant to a
normal course issuer bid. For the month of November, the Trust did not
purchase any units under this program.
The Northwater Five-Year Market-Neutral Trust is a well-diversified fund
of market-neutral hedge funds and a fixed Canadian interest rate exposure.
Units are listed on The Toronto Stock Exchange under the symbol NYF.UN.
For further information:
For further information: Mohamed Khaki or Stephen Foote at Northwater
Capital Management Inc. at (416) 360-5435