TORONTO, Sept. 22 /CNW/ -
Final Net Asset Value
The Northwater Five-Year Market-Neutral Trust (the "Trust") is pleased to
announce today that the net asset value of the Trust per unit as at August 31,
2008 is $19.41. This reflects a return of the Trust for the month of August of
-1.44%. The rolling 12-month return for the Trust is -3.90%. The Trust
previously announced that it has declared a regular quarterly distribution to
be payable to unitholders of record on September 30, 2008 that is $0.4375.
This distribution is expected to be paid on October 15, 2008.
The Trust, through a forward purchase and sale agreement, has exposure to
approximately 120% of a portfolio of market-neutral hedge funds held by
Northwater Five-Year Market-Neutral Fund Limited (the "Fund"). For the month
of August, 8 of the Fund's 32 managers posted positive returns and 2 out of
the 10 market-neutral strategies included within the Fund's portfolio
contributed positively to the bottom line. Specifically, the Fund's
asset-backed securities managers, in aggregate, were the largest positive
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 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. For the month of August, the Trust did not purchase any units
under this program.
Fund Termination June 30, 2009
As disclosed in the Trust's prospectus, the Trust will terminate on or
about June 30, 2009. The Advisor to the Trust and to the Fund has submitted
and will continue to submit redemptions to the hedge funds held by the Fund in
anticipation of the termination of the Trust.
To the extent that the hedge funds to which the Trust has exposure are
not able to honour the redemption timelines to which they have committed,
delay payment or impose other restrictions on liquidity, the Adviser will
explore alternative means of liquidating the Fund's assets, including an
outright sale of the investment. In the event that the Fund is required to
sell any of its interests in hedge funds in lieu of redemption it may realize
less than the reported net asset value of such hedge fund, in which case the
Fund may realize a loss on such investment.
If the Trust is unable to dispose of all of the hedge funds in which it
is invested prior to its termination date, or does not receive payment of
redemption proceeds in full, the Trust may be required to distribute its net
assets on termination by way of multiple payments.
The Northwater Five-Year Market-Neutral Trust is a well-diversified fund
of market-neutral hedge funds. 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