tni asset management...markets(dfm) have recorded the best performance,as the local index in dubai...

The Fund Manager does not and cannot guarantee the performance of the Fund, and the past performance of the Fund is not a guarantee of its future performance. Furthermore, it is understood that the Fund Manager does not give any advice and/or warranties, express or implied, and shall in no way be responsible or liable to any party for relying on any information with respect to the matters identified herein.

0%

20%

40%

60%

80%

100%

120%

140%

160%

Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10

DJ / DIFC Arabia 50

S&P Pan Arab CompositeLarge/MidCap IndexS&P GCC CompositePrice Index

TNI ASSET MANAGEMENT Investor Monthly Newsletter – September 2010

Performance and Strategy Review Market Performance All MENA markets have closed the month in positive territory. The Dubai Financial Markets(DFM) have recorded the best performance,as the local index in dubai jumped 13.5%. International news flow has been very supportive at the beginning of the month, with the fears of a double dip recession easing. The Dubai World restructuring announcement and the successful issuances on the fixed income side (Dubai, Emaar, and Kingdom of Morocco) has fuelled a positive sentiment across the region.

Manager’s Comments

TNI UAE Blue Chip Fund

The recovery of the UAE markets is finally witnessed. Both Dubai and Abu Dhabi Indices rallied by 13.4% and 6.9% respectively. Investor sentiment shifted especially after including the UAE in the FTSE EM Index and issuing debt for Dubai government. During the month of September, the Fund Manager decreased the cash exposure to 1% and increased the GCC allocation to around 4%.

TNI MENA Real Estate Active Fund

We are reviewing the methodolgy of the S&P Pan Arab real estate index, as the latest reshuffle of the benchmark led to the exclusion of Solidere.In the mean time the fund gained 1.78% in september while the S&P Pan real estate Capped index rose 2.58% during the month. We maintained our overweight in Qatar and some underweights in morocco, Egypt, Saudi Arabia, which will activate this position in the fund.

TNI MENA Special Situations Fund

The fund rose 2.72% in September. We increased our fixed income exposure with Mumtalakat; this bond has increased sensibly the duration of our portfolio. On the equity side, we raised our Oman Telecommunication bet and we have been active on the trading side in Abu Dhabi. We booked some profits at the end of the month after the rally, we reduced our equity exposure to 30%. Our monthly performance is coming mainly from our banking bets in Saudi Arabia and Qatar.

TNI MENA UCITS Fund

During the month of September, the Fund Manager maintained the country weights with a full weight to Saudi Arabia, overweight on Egypt and an underweight to Morocco. Furthermore, the Fund Manager reduced the cash allocation to around 1%. The Fund underperformed its benchmark by 1%.

DJ / DIFC 50 TITANS Index- S&P GCC Index

Regional Performance

Performance % MTD YTD DJ Arabia Titans 5.2 6.1

S&P GCC 6.2 7.5

S&P Composite 6.0 8.2

The National Investor

Headquarters TNI Tower| Zayed 1st Street Khali-diya| P.O. Box 47435 | Abu Dhabi, |UAE Phone: +971 2 619 2300

Fax: +971 2 619 2400 www.tni.ae

Inside this issue: MENA Markets back in focus

Topic of the month: Rejoice & Double Dip


Headquarters TNI Tower| Zayed 1st Street Khali-diya| P.O. Box 47435 | Abu Dhabi, |UAE Phone: +971 2 619 2300

Fax: +971 2 619 2400 www.tni.ae

Other MENA Indices MTD% YTD%

Egypt 3.3 5.9

Morocco 7.0 6.4

Tunisia 10.9 22.8

Jordan 4.6 -9.4

Lebanon -1.2 -11.3

S&P GCC Indices MTD% YTD%

Saudi Arabia 4.9 13.9

UAE 1.3 -6.7

Kuwait 9.0 21.4

Qatar 5.9 10.4

Oman 3.2 5.1

Bahrain 1.1 11.8


100

200

300

400

500

600

700

May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10

50%

75%

100%

125%

150%

175%

200%

Dec-08 Feb-09 Apr-09 Jun-09 Aug-09 Oct-09 Dec-09 Feb-10 Apr-10 Jun-10 Aug-10

S&P Pan Arab S&P Extended Frontier MSCI BRICS S&P 500

MARKETS REVIEW September 2010

The MENA Equity Markets

Investors seem to be showing confidence in Dubai once again after news of two bond issues from the emirates last month. Emaar properties stating to issue $540 mn bond and $1.25 bln Dubai government bond drawing healthy demand. The announcement by the index provider FTSE Group to classify UAE as a secondary emerging market will potentially pave the way for inflow of foreign institutional money to the region. The UAE’s IPO market has been moribund since the financial crisis struck in 2008, but retailer Axiom Telecom – 40 percent owned by a unit of Dubai Holding – may launch an initial public offering by the end of this year. UAE telco Etisalat and Kuwait’s Zain are working on an offer that seems to be welcomed by the investor community.

The strength of the link between Middle East and world markets is open to debate, but risk appetite seems contagious and so with investors across the globe seemingly feeling braver of late, with oil trading above $80, the expectations are for more regional gains in the medium term.

In Egypt, property developers led the main index to a new four-month high after a state-appointed legal committee outlined a solution to a dispute over the land used by Talaat Moustafa for its Madinaty project. Saudi and Qatari banks are expected to exhibit strong growth in the following few quarters, mailnly on falling provisions and wider spreads due to liability management, rather than loan book growth.

Chart 1: Dubai Government Bond 5 Yr CDS in USD

Source: Bloomberg

Chart 2: Regional indices lagging Emerging Markets


TOPIC OF THE MONTH September 2010

Rejoice, pain and double dip It is very rare that the US looks at Europe with envy! The past months have witnessed those rare moments. Concerns about America’s tumbling recovery have been rising just as anxiety about the euro zone economies faded. The dollar is weakening amongst rich-world economies and gold is touching the $1,300 mark. Some economists believe that America’s disappointing GDP growth figures in Q2 (+2.4% at an annualized rate) could be the start of a slide towards a second recession, with one out of ten people still unem-ployed. Even though corporate America is flush with cash, companies are still shy of hir-ing preferring to squeeze yet more output from fewer people. Paradoxically, Europe renewed hopes as the euro zone growth figures came higher than the US in Q2, thanks to strong growth in Central Europe and mainly in supercharged Germany. Increased sales to fast growing emerging markets – namely BRICS – have brought German industry its strongest quarter in decades. Germany’s unemployment rate (7.6%) is a bit lower than at the start of the financial crisis in September 2008. Yet it is only few months ago that fortunes looked reversed. Then, America seemed to be pulling back strongly while Europe was limping. The dollar was riding high along with gold as investors fled the euro zone. But both America and Europe seem to be suffering from delusions of weakness and strength. In Europe, it is far too early to celebrate the recovery - Spanish unemployment levels and Irish CDS rates are clear indications in that sense. In the US the recovery has particularly lost momentum as real estate is still a drag to the economy. The need to de-leverage both economies is the other major drag for growth. The US and Europe remind us of Mark Twain’s quote on statistics:”if you have one leg on burning firewood and another on ice bar, statistics will tell you that on average you are comfortable”. The US and Europe are equivalent to firewood and ice bar, investors are better off jumping both. On the other hand, less leveraging and more potential is boosting growth in emerging markets, which could continue to decouple – particularly BRICS – depending on how weak is the weakness in the developed economies. Worries of a double dip have faded but still exist driven by weakness in Japan, the US and the peripheral countries of the euro zone. Two factors are expected to add to the weakness in the developed countries: on one hand governments are running out of policies and incentives, on the other, serious fiscal retrenchments could kick-in in 2011, with some financial problems coming in as too big to bail out. In a double dip scenario, the decoupling theory will fall apart and emerging markets are expected to underperform as the aversion to risk will shoot through the roof. Economic growth and demand for manufactured goods and services from China and India, and for natural resources from the rest of the BRICs will be strongly affected, and investors will tend to exit risky assets first (frontier and emerging markets). Otherwise, and in any other scenario (mild slowdown, U shape or L shape), emerging, frontier and MENA markets have a very strong potential to decouple. There is a high probability of an outperformance in the MENA region due to the fact that it has signifi-cantly lagged behind other emerging markets. Positive current accounts, net exporting economies, large surplus capital, market oriented reforms and good infrastructures will provide strong catalysts for growth. Making good use of excess cash from oil outputs can also come in handily. The problem of the absence of independent monetary policies in the GCC countries, and the peg to the dollar could constitute a burden on the MENA economies in case of a confirmed decoupling. Governments and Central Banks of the region are stripped of any monetary and fiscal tools which could lead to asset bubbles again if global interest rates remain as low.

TNI UAE BLUE CHIP FUNDFact Sheet as of September 30, 2010

Fund Profile

Asset Allocation Top Holdings

Fund Performance since Inception

Monthly Performance (%)

Fund Facts

Fund Performance (%)

MSCI UAE Index (%)


Headquarters

TNI Tower | Zayed 1st Street Khalidiya |

P.O. Box 47435 | Abu Dhabi | UAE

Phone: +971 2 619 2300

Fax: +971 2 619 2400

www.tni.ae

Fund Profile

Large

Value

Emaar

Etisalat

NBAD

DP WORLD LTD

FGB

11.2%

9.5%

8.3%

7.5%

5.8%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

110%

120%

130%

140%

150%

May-

05

Sep-0

5

Feb-0

6

Jun-0

6

Sep-0

6

Dec-0

6

May-

07

Oct-0

7

Apr-0

8

Sep-0

8

Feb-0

9

Jul-0

9

Dec-0

9

Jun-1

0

TNI BCF

MSCI UAE Index

S&P UAE Dom CappedIndex

BCF vs. MSCI UAE Index*

Inception Date

Currency

Minimum Inv.

NAV / Unit

Initial Fee

Management Fee

Custody Fee

Performance Fee

Hurdle Rate

Redemption Fee

NAV

Lock-up Period

Custodian

Administrator

Auditors

Lawyers

Net Assets

Reuters

Bloomberg

Fund Manager

The Fund Manager does not and cannot guarantee the performance of the Fund, and the past performance of the Fund is

not a guarantee of its future performance. Futhermore, it's understood that the Fund Manager does not give any advice

and/or warranties, express or implied, and shall in no way be responsible or liable to any party for relying on any

information with respects to the matters identified herein.

Blend Growth

Medium

Small

Generated by

Sophis Value

Focus: Although the fund may participate in markets throughout the Gulf Cooperative

Countries ('GCC'), its investments will be primarily focused on publicly traded equities of UAE

firms with large capitalization, which present a steady and recurrent track record of earnings

growth and have a potential for capital appreciation.

May 01, 2005

AED

AED 1 million

1% (max.)

1.5% annually

0.45% annually

10% subject to

High Watermark

EIBOR (3M)

1% after 1 Year

Weekly

None

Deutsche Bank

Deutsche Bank

KPMG

Tamimi & Co

BCF - TNIBCF

BCF - TNIUAEF -UH

Since Inception

TNI UAE Blue Chip Fund

MSCI UAE Index

-49.1

-66.3

%

Index comparison is used for

illustrative purposes only.

S&P UAE Dom Capped -60.8

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec YTD

2005 - - - - 2.7 6.9 -11.2 6.0 5.9 4.3 1.3 -4.1 12.2

2006 -5.4 -4.7 -3.4 -8.5 -5.7 -2.9 -2.4 5.2 2.2 -3.4 -8.4 0.3 -32.9

2007 -0.8 2.5 -5.1 3.7 18.8 -1.7 - -3.8 1.6 18.9 4.4 9.1 54.9

2008 -3.7 7.2 -6.1 9.8 -0.5 -1.8 0.8 -15.0 -15.7 -22.4 -23.2 -12.1 -60.7

2009 -4.6 4.9 8.7 5.8 9.3 -1.8 5.1 4.2 13.2 -2.9 -4.8 -13.1 22.8

2010 -8.3 -3.4 16.7 -1.7 -9.1 -2.9 -1.8 -1.9 10.5 - - - -4.5

AED 5.09

0.3WTD

10.5MTD

-4.5YTD

-49.1Since Inception

0.4WTD

12.3MTD

-4.0YTD


AED 85.5M

TNI

Abu Dhabi 50.5%

Cash 0.9%

DIFX 8.6%

Dubai 36.2%

GCC 3.7%

Management Style: The key investment criteria are the company's financial strengths,

competitiveness, profitability, growth prospects and quality of management. The allocation

will be based on fundamental research and will incorporate a blend of top -down and a

bottom-up analytical approach.

Objective: The fund aims to provide long-term capital appreciation through investing in equity

securities publicly traded, primarily in the UAE, and to a lesser extent, in other GCC markets.

Suitability: Units of the Fund are speculative and involve a high degree of risk. The Fund is

therefore designed for sophisticated investors who are able to understand the risks involved in

emerging markets' equity investments, particularly in the GCC equities.

0.5WTD

10.8MTD

-7.2YTD


S&P UAE Dom Capped Index (%)


1.0

3.7

2.1

-1.2

-5.6

-10.0 -5.0 0.0 5.0

-2.4

-2.8

1.0

0.7

2.1

0.4

0.9

0.1

1.7

-1.6

-5.0 0.0 5.0

0

0.9

1.0

5.7

6.3

6.7

7.5

11.6

24.1

36.4

0 10 20 30 40

Materials

Investments

Cash

Transportaion

Services

Utilities

Marine

Telecoms

Real Estate

Banking

1.0

3.7

8.6

36.1

50.5

0 10 20 30 40 50 60

Cash

GCC

DIFX

Dubai

Abu Dhabi

0%

5%

10%

15%

20%

25%

Apr-06 Jan-07 Oct-07 Jul-08 Apr-09 Jan-10

``

TNI UAE BLUE CHIP FUND

Fund Analytics as of September 30, 2010 Asset allocation by Exchange (%) Deviation by Exchange (%)

Asset allocation by Sector (%) Deviation by Sector (%)

Fund Statistics

Weighted Av. PE Weighted Av. PB Weighted Av. ROE% Market Cap (AED b)

TNI BCF 11.6 0.9 12.2 15.2

S&P UAE Capped 11.9 0.9 10.5 14.5

MSCI UAE 12.1 0.8 8.6 11.8

1Y 2Y 3Y Since Inception

Relative Alpha -0.8 4.0 4.6 4.2

Ann. Return -23.4 -23.8 -16.1 -11.7

St. Deviation 28.3 35.6 35.1 29.7

Tracking Error 6.7 8.2 8.2 12.7

Info. Ratio -0.1 0.5 0.6 0.3

Returns

(%)

TNI

BCF

S&P

Cap

MSCI

UAE

1M 10.5 12.3 10.8

3M 6.5 3.0 -2.1

6M -7.6 -19.4 -20.1

1Y -23.4 -1.1 -3.7

3Y -40.9 -53.6 -54.0

Inc -49.1 -67.3 -60.8

Evolution of Yearly Tracking Error

The Fund Manager does not and cannot guarantee the performance of the Fund, and the past performance of the Fund is not a guarantee of its future performance. Furthermore, it is understood that the Fund Manager does not give any advice and/or warranties, express or implied, and shall in no way be responsible or liable to any party for relying on any information

Value Blend Growth

Large

Medium

Small

30%

50%

70%

90%

110%

130%

150%

Aug-05 Jan-06 Jun-06 Nov-06 Apr-07 Sep-07 Feb-08 Jul-08 Dec-08May-09 Oct-09 Mar-10 Aug-10

MENA REAF

S&P MENA RE Pan Arab Index

`

ADSM6.9%

Egypt14.5%

Qatar14.9%

DFM13.5%

Morocco4.6%

Lebanon8.1%

KSA31.7%

KWT2.4%

CASH3.0%

7.4%

8.1%

8.7%

9.7%

11.0%

Dar Al Arkan

Solidere

Emaar

Orascom Con.

Al Soor

TNI MENA REAL ESTATE ACTIVE FUND Fact Sheet as of September 30, 2010

Fund Profile

Focus: the Fund is a sector focused fund mainly targeting investments in equities of real

estate firms publicly traded in the Middle East and North Africa (MENA) official exchanges.

The Fund provides investors with a liquid investment approach to a traditionally illiquid and

capital intensive sector.

Management Style: the key investment criteria are the company’s financial strengths,

competitiveness, profitability, growth prospects and quality of management. The allocation

will be based on fundamental research and will incorporate a blend of top-down and a

bottom-up analytical approach.

Objective: the fund aims to provide long-term capital appreciation through investing in

equity securities of real estate firms publicly traded in the MENA equity markets. Fund

investments can also include private equities of firms expected to list their shares within a 12-

month period, as well as debt instruments issued by MENA real estate firms.


therefore designed for sophisticated investors who are able to understand the risks involved

in emerging markets’ equity investments, particularly in the MENA equities.

Asset Allocation Top Holdings



Inception Date August 01, 2005

Currency USD

Minimum Inv. $ 100,000

NAV / Unit* US$ 839.624

Initial Fee Up to 3.0%

Management Fee 1.5% annually

Custody / Admin Fee 0.45% annually

Performance Fee 10% subject to High

Watermark

Hurdle Rate 3 M LIBOR

Redemption Fee 0% after 18 months

NAV Weekly

Lock-up Period None

Custodian HSBC Bank Middle East Ltd

Administrator Apex Fund Services Ltd

Auditors Deloitte & Touche

Lawyers Appleby

Net Assets USD 11 million

Reuters TNIMREF

Bloomberg TNIMREF UH

Domicile Bermuda

Fund manager TNI

Fund Profile

Fund Facts

Since Inception %

TNI MENA REAF -32.5

S & P Pan Arab RE index** -48.3 **The S&P MENA Real Estate Index was created in a joint effort between S&P and TNI. Going forward, the Index will be used as a benchmark for the fund. The returns of MSCI Arabian Real Estate Capped Index, used as a benchmark up to April, 29th 2010, have been applied before this date for consistency purposes.


Headquarters

TNI Tower | Zayed 1st Street Khalidiya|


Phone: +971 2 619 2300

Fax: +971 2 619 2400

www.tni.ae

*The Fund has been re-domiciled to a Bermuda Segregated Account Company and the showed NAV can be converted to the old NAV by using 0.8039% as a multiplier.

WTD -0.9

MTD 1.2

YTD -12.6

Since Inception -32.5

Fund Performance* (%)

%

Jan

Feb

Mar

Apr

May

June

July

Aug

Sept

Oct

Nov

Dec

YTD

2005 - - - - - - - +4.5 +6.3 -0.9 +1.5 +3.9 +16.2

2006 +1.4 -5.6 -0.8 -5.9 -9.3 -5.6 -1.8 +6.5 +5.2 -0.6 -7.3 +2.8 -20.4

2007 +0.9 +3.8 -2.1 -0.3 +11.0 -1.0 +2.7 +0.1 +7.7 +15.1 +9.2 +2.1 +59.7

2008 -1.6 +7.1 -5.4 +6.1 -2.9 -4.6 -5.2 -10.0 -11.9 -20.3 -7.5 -6.0 -48.9

2009 -5.1 -2.8 -0.4 +2.6 +9.7 -0.3 +0.8 +3.2 +6.8 +0.7 -4.7 -6.9 +2.2

2010 -5.0 -2.1 +6.0 -0.2 -7.4 -0.4 -2.7 -2.1 +1.2 -12.6

S & P Pan Arab RE index

(%) WTD -0.4

MTD 1.9

YTD -14.6

Since Inception -48.3


0%

5%

10%

15%

20%

25%

30%

Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10

2.5

0.0

6.0

8.1

13.1

15.2

20.4

31.7

Kuwait

Cash

Mor.

Leb.

Egypt

Qatar

UAE

KSA

‐1.3

0.0

‐3.4

8.1

‐5.2

6.0

0.7

‐7.8

11.0

13.0

36.6

36.4

Const. & Eng.

Const. Mat.

Div. R.E.

R.E. Dev.

1.4

‐3.9

4.4

‐4.9

TNI MENA REAL ESTATE ACTIVE FUND Fund Analytics as of Sep 30, 2010

Asset allocation by Exchange (%) Deviation by Exchange (%)

Asset allocation by Sub-Sector (%) Deviation by Sub-Sector (%)

Fund Statistics

Weighted Av. PE Weighted Av. PB Weighted Av. ROE (%) Market Cap. (US$B)

MENA REAF 10.7 1.5 9.5 3..0

S & P Pan Arab R.E. 11.4 1.9 11.7 3.4

1Y 2Y 3Y Since Inception

Relative Alpha (%) 1.9 6.5 4.5 4.7

Ann. Return (%) -22.0 -21.3 -16.3 -7.3

Volatility (%) 13.1 20.7 23.3 20.9

Tracking Error (%) 4.8 17.4 17.2 18.3

Info. Ratio 0.4 0.4 0.3 0.2

Returns (%) MENA

REAF

S P Pan Arab

R.E. Index

1M 1.2 1.9

3M -3.5 -3.6

6M -11.3 -15.1

YTD -12.6 -14.5

Since launch -32.5 -48.3

Evolution of Yearly Tracking Error

TNI MENA SPECIAL SITUATIONS FUNDFact Sheet as of September 30, 2010

Fund Profile

Asset Allocation by Geography Top Holdings (ex. Money Market)



Fund Facts


MSCI Arabian Markets (%)*


Headquarters

TNI Tower | Zayed 1st Street Khalidiya |


Phone: +971 2 619 2300

Fax: +971 2 619 2400

www.tni.ae

Mumtalakat Holding

Aldar Conv.

Dar Al Arkan Sukuk

CBQ

SAMBA

9.4%

8.7%

6.6%

4.5%

4.3%

40%

50%

60%

70%

80%

90%

100%

110%

120%

Aug-0

8

Oct-0

8

Dec-0

8

Feb-0

9

Apr-0

9

Jun-0

9

Aug-0

9

Oct-0

9

Dec-0

9

Feb-1

0

Apr-1

0

Apr-1

0

Apr-1

0

May-

10

May-

10

May-

10

Jun-1

0

Jun-1

0

Jul-1

0

Jul-1

0

Jul-1

0

Aug-1

0

Aug-1

0

Sep-1

0

Sep-1

0

TNI SSFMSCI Arabian MarketsUS LIBOR 3M

MENA SSF vs. US LIBOR 3M

First Dealing Day

Currency

Minimum Inv.

NAV / Share

Initial Fee

Management Fee

Custody Fee

Performance Fee

Hurdle Rate

Redemption Fee

NAV

Lock-up Period

Custodian

Administrator

Auditors

Lawyers

Net Assets

Domicile

Bloomberg

Fund Manager

The Fund Manager does not and cannot guarantee the performance of the Fund, and the past performance of the Fund is

not a guarantee of its future performance. Futhermore, it's understood that the Fund Manager does not give any advice

and/or warranties, express or implied, and shall in no way be responsible or liable to any party for relying on any information

with respects to the matters identified herein.

Generated by

Sophis Value

Focus: Achieve absolute return by investing in special situations in the Middle East and

North Africa (MENA) region, primarily focusing on corporate securities and instruments

issued by regional firms.

Sept 01, 2008

USD

USD 1 million

3% (max)

2% annually

0.5% annually

LIBOR (3M)

2%

Monthly

6 Months

HSBC

Apex

Deloitte

Appleby

Bermuda

TNIMESS BH

MSCI Arabian Markets*

Since Inception

TNI MENA SSF

US LIBOR 3M

13.80

-33.14

%

*MSCI Arabian Markets comparison is used for illustrative purposes only as the MENA market is the Universe of the Fund.

2.27

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec YTD

2008 - - - - - - - - -0.18 -3.98 1.26 0.03 -2.92

2009 -1.00 -0.50 1.87 2.79 2.99 -0.32 3.69 1.83 5.25 1.28 -7.52 0.84 11.17

2010 1.13 1.85 3.71 1.41 -5.91 -1.06 2.14 -0.35 2.72 - - - 5.44

USD 1,138.028

2.72MTD

5.44YTD

13.80Since Inception

5.97MTD

7.61YTD


USD 7.8M

TNI

Bahrain 9.4%

Egypt 3.7%Money Market 42.3%

Morocco 3.8%

Oman 3.0%

Qatar 11.7% Saudi 17.3%

UAE 8.7%

Management Style: The allocation will be based on fundamental research and will incorpo-

rate a blend of top-down and a bottom-up analytical approach, with a focus on

bottom-up approach. Portfolio construction will be diversified amongst asymmetric

risk/reward investment ideas, with a major focus on capital preservation.

Objective: The Fund aims to generate long-term capital growth by investing primarily in

special opportunities and situations in the Middle East and North Africa (MENA) region.

Special situations/opportunities include investments in securities such as equities,

convertibles, derivatives and debt instruments.


therefore designed for sophisticated investors who are able to understand the risks involved

in emerging markets' securities investments, particularly in the MENA region.

US LIBOR 3M (%)

0.02MTD

0.27YTD

2.27Since Inception

High Watermark Yes

20%


8.7%

13.5%

16.6%

19.0%

42.3%

Convert.

Equities-Value

Equities-Growth

Sukuk

Money Market

`

8.7%

8.9%

15.3%

24.8%

42.3%

Industries

Financial

Real Estate

Others

Money Market

`

TNI MENA Special Situations Fund Fund Analytics as of September 30, 2010 Asset allocation by Strategy Asset allocation by Sub-Sector Statistics since Fund inception

TNI SSF MSCI ARABIA LIBOR (3M)

Monthly. Return 2.72% 5.38% 0.02%

YTD 2010 5.44% 7.01% 0.27%

Since Inception 11.38% -33.51% 2.00%

Ann. Return Inception 6.40% -17.79 % 0.98%

Volatility 10.03% 30.52% 0.29%

Sharpe Ratio -0.14 NA NA

Correl. (vs. TNI SSF) 1 0.29 0.75

Maximum Drawdown -7.52% -22.27% NA

# of Months 25 25 25

% Positive Month 60.00% 48.00% 100%

Best Month 5.00% 15.21% 0.34%

Worst Month -7.52% -22.27% 0.02%

Returns % TNI SSF MSCI Arabia

1M 2.72 5.38

3M 4.55 9.33

6M -1.03 -4.05

1Y -0.17 -0.65

Since Inception 11.38 -33.51

Returns % TNI SSF LIBOR (3M)

1M 2.72 0.02

3M 4.55 0.11

6M -1.03 0.20

1Y -0.17 0.34

Since Inception 11.38 2.00


TNI MENA UCITS Fund Vs Benchmark

Asset Allocation

38.9%

17.3%

13.2%

11.4%

7.6%

0.8%3.4%

3.0%

2.0%

1.5%

0.8%

Saudi Arabia

Kuwait

Egypt

Qatar

UAE

CashOman

Jordan

Lebanon

Morocco

Bahrain

4.9%

5.0%

5.8%

7.0%

7.8%

Samba P Notes

Al Rajhi Bank P Notes

Zain

Sabic P Notes

NBK

Saudi Arabia has been excluded from MSCI Indices and has been replaced in the chart by The S&P Pan Arab index Composite Large Mid Cap Index.

95%

97%

99%

101%

103%

105%

107%

109%

Jun-10 Jul-10 Jul-10 Aug-10 Aug-10 Aug-10 Sep-10 Sep-10

MENA UCITS S&P Pan Arab 5/10/40 Capped S&P Pan Arab

TNI MENA UCITS FUND Fact Sheet as of September 30, 2010

Fund Profile

Focus: Fund investments will be primarily focused on publicly traded equities in the Middle East and North Africa (MENA) region with large capitalization, which present a steady and recurrent track record of earnings growth and have a potential for capital appreciation.

Management Style: The key investment criteria are the company’s financial strengths, com-petitiveness, profitability, growth prospects and quality of management. The allocation will be based on fundamental research and will incorporate a blend of top-down and a bot-tom-up analytical approach. Allocation of the fund will follow UCITS-3 guidelines.

Fund Objective: The Fund shall provide long-term capital appreciation through investing in equity securities publicly traded, in the Middle East and North Africa (MENA) region. The fund aims to outperform the S&P Pan Arab Large-Mid 5/10/40 Index on a risk-adjusted return basis.

Suitability: Shares of in the sub-Fund are speculative and involve a high degree of risk. The Fund is therefore designed for sophisticated investors who are able to understand the risks in-volved in emerging markets’ equity investments, particularly in the MENA equities.

Since Inception %

TNI MENA UCITS Fund 5.3 S&P Pan Arab Large-Mid 5/10/40 Index 7.8

S&P Pan Arab 6.5

%

Jan

Feb

Mar

Apr

May

June

July

Aug

Sept

Oct

Nov

Dec

YTD

2010 - - - - - 0.4 1.6 -0.8 5.8 NA

WTD 0.6

MTD 6.8

YTD NA

Since Inception 6.5

Value Blend Growth Large

Medium

Small

Fund Profile

WTD 0.2

MTD 5.8

YTD NA

Since Inception 5.3

Fund Facts

S & P Pan Arab Index (%)

Inception Date June 17, 2010

Currency USD

Minimum Inv. USD 100,000

NAV / Unit USD 1,052.93

Initial Fee 3% (max.)

Management Fee 1.4% annually

Custody Fee 0.45% annually

Performance Fee 10% subject to

High Watermark

Redemption Fee 0% after 1 Year

NAV Weekly

Lock-up Period None

Custodian Citibank (Dublin)

Administrator Apex Fund Services (Dublin)

Auditors Deloitte (Dublin)

Lawyers Mason, Hayes & Curran (Dublin)

Net Assets USD 28.19m

Bloomberg TNIMENA

Reuters LP68056061

ISIN IE00B5TKJM01

Domicile Dublin

Fund Manager TNI-Dubai Fund Performance since Inception

S&P Pan Arab 5/10/40 Index (%)

WTD 0.8

MTD 6.8

YTD NA

Since Inception 7.8


Headquarters TNI Tower | Zayed 1st Street Khalidiya| P.O. Box 47435 | Abu Dhabi | UAE Phone: +971 2 619 2300 Fax: +971 2 619 2400

www.tni.ae

Index comparison is used for illustrative purposes only.

Top Holdings




0.0

0.8

0.8

1.5

2.0

3.0

3.4

7.6

11.4

13.2

17.3

39.0

0 10 20 30 40 50

Tunisia

Bahrain

Cash

Morocco

Lebanon

Jordan

Oman

UAE

Qatar

Egypt

Kuwait

Saudi Arabia

-0.8

-1.0

0.8

-4.5

-0.1

-0.5

1.3

0.3

2.2

3.2

-3.7

3.5

-6 -4 -2 0 2 4

0.8

6.4

10.2

15.2

17.3

50.0

0 10 20 30 40 50 60

Cash

Services

Real Estate

Telecoms

Industry

Banking

0.8

0.2

-2.1

0.0

0.0

1.8

-3 -2 -1 0 1 2

TNI MENA UCITS FUND Fund Analytics as of September 30, 2010

Asset allocation by Geography (%) Deviation by Geography (%)

Asset allocation by Sector (%) Deviation by Sector (%)

Fund Statistics

Weighted Av. PE Weighted Av. PB Weighted Av. ROE% W. Avg. Market Cap. (US$B)

UCITS 12.4 2.1 13.0 15.1

S&P PAN Arab 15.7 2.6 12.5 12.2

Sector Statistics

Weighted Av. PE Weighted Av. PB Weighted Av. ROE%

Banking 15.6 2.5 16.1

Real Estate 13.3 1.9 12.3

Industry 12.4 3.1 15.3

Telecommunications 8.4 2.7 18.8

Services 16.3 2.7 16.1

Returns

(%)

MENA

UCITS

S&P Pan

Arab

1W 0.2 0.8 1M 5.8 6.8 3M 10.1 11.3 Inc 7.8 5.3


TNI ASSET MANAGEMENT Team Members

Fund Management Walid Hayeck Managing Director +971 2 619 2321 [email protected] Sebastien Henin Vice President +971 2 619 2337 [email protected]

Ali Adou Vice President +971 2 619 2327 [email protected] Mohammed Shaikh Analyst +971 2 619 2326 [email protected]

Business Development Kashif Zia Director +971 2 619 2305 [email protected] Sani Tsuruta Vice President +971 2 619 2356 [email protected]

Middle Office and Risk Management Imran Ladhani Manager +971 2 619 2334 [email protected] Ahmed Bakir Analyst +9712 619 2329 [email protected]

Operations & Settlement Rajeev Nanda Director +971 2 619 2421 [email protected]

Malik Al Zyadat Senior Manager +971 2 619 2425 [email protected]

Compliance Ajith Mathew Senior Vice President +971 2 619 2366 [email protected]

Custody & Administration Deutsche Bank Mike Cowley +971 4 361 1700 [email protected] Apex Fund Services Peter Hughes +144 1 292 2793 [email protected] HSBC Fund Services Asser Makarem +971 4 509 3515 [email protected] Citibank John Dwyer +9714 604 4450 [email protected]

Auditors KPMG Munther Dajjani +971 2 634 3318 [email protected]

Deloitte & Touche Wissam Moukahal +971 2 676 0606 [email protected]

Distribution PICER Gabrielle Verwilghen +41 55 422 24 60 [email protected] IGS Group John Godden +44 (0) 20 7395 680 [email protected]

Important Notice

This “Investor Monthly Newsletter” is confidential to the addressee and should not be disclosed nor distributed to any third party without the prior consent of The National Investor (hereinafter referred to as “TNI”)

This newsletter is for information and does not constitute a prospectus or offering circular or an offer or invitation to subscribe for Units or Shares in any of TNI Funds. All TNI Funds (the “Funds”) are available for subscription only on the basis of the relevant Private Placement Memorandum, Subscription Agreement and Application Form which are available only to investors that satisfy the ap-plicable eligibility criteria for investment.

TNI Funds included in this Newsletter are unregulated funds for the purposes of the United Kingdom Financial Services and Markets Act 2000 (“FSMA”), the promotion of which in the United Kingdom is restricted by sections 21 and 238 of FSMA. Accordingly, no TNI Funds’ shares or units may be offered or sold in the UK other than (i) by a person authorized by the UK Financial Services Authority (the “FSA”) (an “Authorized Person”) in accordance with the Financial Services and Markets Act 2000 (Promotion of Collective In-vestment Schemes - Exemptions) Order 2001 or the FSA Conduct of Business Rules; or (ii) by a person other than an Authorized Per-son in accordance with the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005. The Funds are not regu-lated by the FSA and investors will not have the benefit of the FSA Financial Services Compensation Scheme and other protections afforded by FSMA or its rules and regulations.

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