By: Australian Fund Monitors

Report Date	11 May 2010
Manager	Regal Funds Management
Fund Name	Regal Tasman Market Neutral Fund
Strategy	Equity Market Neutral
Latest Return Date	April 2010
Latest Return	2.23%
Latest 6 Months	8.30%
Latest 12 Months	54.99%
Latest 24 Months	43.24%
Annualised Since Inception	23.42%
Inception Date	03 May 2007
FUM (millions)	AU$23
Fund Overview	The Tasman Market Neutral Fund aims to maximise returns with only moderate risk and little correlation to equity markets. Investments are usually based on fundamental research and may be held for months or years. Hedging is usually achieved through single stock exposures. The fund aims to limit the volatility of returns to less than 15% pa and maintains a beta neutral portfolio. Risk limits (stock, sector, liquidity, systematic etc) are maintained to help achieve the volatility target. Most of the investments are in Australia but investments are also made in other countries on an opportunistic basis (mainly in Europe and no emerging markets).
Manager Comments	Regal's Tasman Market Neutral Fund was the manager's best performing fund in April, generating a return of +2.23% off both long and short positions. Successful shorts included Harvey Norman, JB Hi-Fi, Woolworths and CSL which fell 11% during April. Winners on the long side included FKP, an aged living operator, and Lihir Gold which the manager increased the fund's position in after Newcrest said it had approached Lihir about a merger. Regal reports that the Fund's daily volatility is at record lows and correlation to the market also remains low.
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By: Australian Fund Monitors

This month we include comments on two significant announcements from the Australian government, both of which have significant implications for the industry and investors alike:

1. The proposed introduction of a "Super Tax" on Australia's resources industry, which has sent shivers through investors, and
2. The proposed changes to the financial advisory and funds management industry, banning the payments of commissions and volume rebates, and enforcing fiduciary duties on advisors.

As usual we include detailed analysis of performance for each strategy, industry comment and ranking tables for March 2010.

For detailed analysis of performance for each strategy, industry comment and ranking tables, please open the attached .pdf file.

By: Australian Fund Monitors

Report Date	21 April 2010
Manager	Herschel Asset Management
Fund Name	Herschel Absolute Return Fund
Strategy	Equity Long/Short
Latest Return Date	March 2010
Latest Return	4.36%
Latest 6 Months	5.62%
Latest 12 Months	27.24%
Latest 24 Months	26.82%
Annualised Since Inception	17.86%
Inception Date	01 May 2006
FUM (millions)	AU$37
Fund Overview	The Herschel Absolute Return Fund is a long-short Australian equities fund which is expected to average 50% net long through an investment cycle. The objective of the fund is to achieve consistent, double-digit rates of return, with an over-arching philosophy of capital protection. The Fund will usually invest in a portfolio, consisting of both long and short positions, of securities of 15 to 45 companies.
Manager Comments	Herschel saw their Absolute Return Fund gain 4.36% in March with holdings in Fairfax Preference shares, Ten Network, Westpac and Virgin Blue all making positive contributions. Detracting from the fund's performance were Share Price Index Futures (hedging long positions) and Downer EDI. At the end of the month net equity market exposure (including derivatives) for the fund stood at 50.5% (73.2% long and 22.7% short).
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By: Australian Fund Monitors

Report Date	20 April 2010
Manager	OC Funds Management
Fund Name	OC Premium Equity Fund
Strategy	Equity Long
Latest Return Date	March 2010
Latest Return	6.10%
Latest 6 Months	14.95%
Latest 12 Months	73.98%
Latest 24 Months	-5.35%
Annualised Since Inception	9.92%
Inception Date	01 December 2000
FUM (millions)	AU$28
Fund Overview	The OC Premium Equity Fund is an unbenchmarked, long-only Australian equities fund. The investment strategy is to build long term investments in a broad range of ASX listed securities with a focus on smaller to midcapitalisation industrial companies due to their relative simplicity, potential for growth and inefficiencies in market pricing. Investments are only made where the risk/return equation is compelling. The fund employs a \\\\'buy and hold\\\\' strategy. No leverage or derivatives are employed. The fund does not short. The fund managers own more than 50% of the firm. All performance fees are reinvested into the fund for a minimum of 12 months. The Premium Fund will hold between 20 and 50 listed securities, will not invest more than 11% of the total portfolio in any one individual position and it will not own more than 7.5% of the capital in one company.
Manager Comments	The 4.7% gain returned by the OC Premium Fund in March was boosted by the performance of recently listed retailer Katmandu, which was up 17% over the last quarter following the release of its first set of financial results. During the last quarter the fund benefitted from new positions added including Ausenco, Adelaide Brighton, Clough, Sedgman Limited and SMS Management and Technology which the manager believes are high quality mid cap companies which had been sold down to attractive entry prices.
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By: Australian Fund Monitors

Report Date	13 April 2010
Manager	Bennelong Group
Fund Name	Bennelong Securities Long Short Equity Fund
Strategy	Equity Market Neutral
Latest Return Date	March 2010
Latest Return	4.77%
Latest 6 Months	6.58%
Latest 12 Months	8.75%
Latest 24 Months	38.67%
Annualised Since Inception	22.63%
Inception Date	01 January 2003
FUM (millions)	AU$92
Fund Overview	Bennelong Long Short Equity Management applies a qualitative stock selection process to construct a diversified portfolio of paired securities based on relative value. The Bennelong Long Short Equity Management strategy invests primarily in the S&P/ASX 100 and is dollar neutral at cost.
Manager Comments	Bennelong's Long Short Equity Fund posted a positive return of 4.4% in March, taking the view that much of the drawdown the fund experienced in February was not related to longer term fundamentals. The manager made some adjustments to the portfolio, but remained generally comfortable with the fund's positioning which saw a number of underperforming positions reverse. Looking ahead Bennelong expects the arm-wrestle between divergent macro views to continue, with an improving growth outlook conflicting with concerns about sovereign debt and structural risks.
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By: Australian Fund Monitors

Report Date	12 April 2010
Manager	K2 Asset Management
Fund Name	K2 Select International Absolute Return Fund
Strategy	Equity Long/Short
Latest Return Date	March 2010
Latest Return	4.70%
Latest 6 Months	3.26%
Latest 12 Months	34.31%
Latest 24 Months	14.01%
Annualised Since Inception	13.27%
Inception Date	01 January 2005
FUM (millions)	AU$185
Fund Overview	K2 Select International Absolute Return Fund invests in global equities on a long/short, opportunistic trading basis. The K2 Select International fund is an AUD-denominated unit trust. Its strategy combines macro asset allocation with multi-variable stock selection. Internal and external research is extensive. K2 limits single-security exposure to 10% of the fund's NAV on a cost basis. Gearing is employed at a maximum of two times, mainly used to reduce net long exposure. The fund has a long bias, targeting 50% to 60% net long over an investment cycle. Cash positions have exceeded 50% and been as low as 5%. 50 to 70 positions are typically held. The management employs several stop-loss measures, including a stop-loss policy of 10% on shorts.
Manager Comments	Net equity exposure for K2's Select International Fund was between 80% and 100% throughout March, generating a positive result of 4.7%. The manager expects to maintain net equity exposure above their neutral position of 65% over coming months, taking the approach of picking stocks where they see ample equity investment opportunities rather than trying to predict the source of the next financial crisis. The fund is currently hedging 72% of its exposures back to AUD as the manager sees positives and negatives for the local currency versus other currencies as being fairly balanced at this point.
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By: Australian Fund Monitors

Report Date	12 April 2010
Manager	Prime Value
Fund Name	Prime Value Growth Fund
Strategy	Equity Long
Latest Return Date	March 2010
Latest Return	5.30%
Latest 6 Months	3.81%
Latest 12 Months	31.17%
Latest 24 Months	0.91%
Annualised Since Inception	16.37%
Inception Date	10 April 1998
FUM (millions)	AU$288
Fund Overview	The PVGF aims to provide superior medium to long-term capital growth, with some income, by managing a portfolio of predominantly Australian equities listed on any recognised Australian stock exchange.
Manager Comments	Prime Value's Growth Fund rode the back of a strong sharemarket to post a gain of 5.3% in March. Positive contributors were BHP Billiton, National Australia Bank and Westpac, while detractors included Nufarm and Downer EDI. The manager believes that conditions remain supportive of equities due to growth in emerging economies, further technological innovation and an improvement in corporate health following a period of cost cutting and debt reduction. The fund's cash holding is currently less than 10%, with Prime Value preferring the mining, mining services, energy and consumer staples sectors.
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By: Australian Fund Monitors

Report Date	12 April 2010
Manager	Pengana Capital
Fund Name	Pengana Global Resources Fund
Strategy	Equity Long/Short
Latest Return Date	March 2010
Latest Return	9.79%
Latest 6 Months	22.41%
Latest 12 Months	54.47%
Latest 24 Months	9.17%
Annualised Since Inception	16.28%
Inception Date	01 January 2007
FUM (millions)	AU$5
Fund Overview	The fund provides investors with a long-short equity exposure to companies within the global mining, energy, steel, commodities and associated services sectors. The fund objective is to generate performance in excess of 15% per annum with an annualised standard deviation of between 8% and 12%. The fund uses multiple strategies to profit from inefficiencies in the pricing of small and large companies and event driven activity. The fund employs three core strategies: - Pairs trading in liquid, large capitalisation stocks - Directional long and short positions in mid and small capitalisation stocks - Event driven (e.g IPO's, mergers and acquisitions), and other corporate activity.
Manager Comments	Rising prices for many commodities in March helped Pengana's Global Resources Fund to gain 9.8% for the month. Key contributors to the result were Anglo American (+20.25%), Atlas iron (+21.29%), Bluescope Steel (+20.25%) and Matrix Composites and Engineering (+34.62%). The manager reports that long positions in Alumina, Mirabela Nickel and Gryphon Minerals were sold during the month while the fund's long position in Matrix Composites and Engineering was reduced.
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By: Australian Fund Monitors

Report Date	12 April 2010
Manager	PM CAPITAL
Fund Name	PM CAPITAL Absolute Performance Fund AUD
Strategy	Equity Long/Short
Latest Return Date	March 2010
Latest Return	10.10%
Latest 6 Months	7.19%
Latest 12 Months	58.98%
Latest 24 Months	-7.18%
Annualised Since Inception	6.40%
Inception Date	01 October 1998
FUM (millions)	AU$350
Fund Overview	A long-biased global long/short equity fund, PM CAPITAL Absolute Performance focuses on generating absolute long-term returns. PM CAPITAL holds concentrated positions in companies viewed to be substantially mis-priced by the market, expecting the businesses to generate significant returns over a two- to three-year time horizon. Fundamental analysis is the core of the investment strategy. Shorts are taken on overvalued companies. Hedging is used to protect existing long positions at times of perceived market risk. Risk management is mainly achieved through diversification, focusing on ensuring diversification not just among sectors, but also among macro factors such as interest rates and commodities. The fund invests globally. No individual position is to be greater than 10% of fund NAV, at the cost of the investment; typically 35 to 45 core positions are held. The fund is not afraid to carry cash.
Manager Comments	Better than expected earnings for US and European banks helped PM Capital's Absolute Performance Fund post a gain of 10.1% in March. The fund's holdings in Lloyds, Wells Fargo and ING Group all contributed to the result, as did technology companies Novellus and Comcast. A little more than half of the fund continues to be invested in financial companies in the US, Europe and Asia, while 30% is invested in technology companies.
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By: Australian Fund Monitors

Australian Hedge Funds produced positive returns in February, but for many managers it was a tough month.

Equity markets started the month much as January left off, with concerns over new legislation in the US, Greece’s sovereign debt issues possibly spreading elsewhere in Europe, and potential credit tightening in China all combining to prompt hedge fund managers to take risk off the table.

For detailed analysis of performance for each strategy, industry comment and ranking tables, please open the attached .pdf file.