Investment Approach

The Fund has been designed to take advantage of the expertise of New Star Asset Management Limited, (the ''Investment Manager'' or ''New Star'') in investing in the global financial services sector. The Investment Manager has a strong track record in this area and believes that the global financial services sector will continue to outperform other sectors of the market.

The Fund's investment objectives are to:

1. provide holders of the Units (''Unitholders'') with a stable stream of monthly cash distributions initially targeted to be $0.05 per Unit (representing a yield of approximately 6.0% per annum on the issue price of $10.00 per Unit); and

2. preserve and enhance the net asset value per Unit of the Fund.

In order to achieve the Fund's investment objectives, the net proceeds of the Offering, together with any borrowings under the Fund's loan facility, will be invested in an actively managed portfolio (the ''Portfolio'')consisting of securities of global financial services businesses. The Portfolio will be actively managed by New Star. The Fund will target using leverage in an amount equal to approximately 10% of its total assets. However, the Investment Manager may, in its discretion, increase or decrease the amount of leverage the Fund employs based on its expectation of returns available in the market, subject to a maximum of 15% of the Fund's total assets.

Global Financial Services Sector

Financial services companies are involved at every level of an economy. In most markets, financial services companies represent 15-30% of a market's total capitalization. They generate revenues from individuals, companies, public bodies and governments. As a result, New Star believes that a portfolio of financial services companies can act as a vehicle for investment in a wide range of activities across a number of countries.

New Star believes the following factors contribute to the long-term attractiveness of the global financial services sector:

1. banking, pensions, insurance and asset management companies all stand to benefit from ageing populations and rising wealth in developed and emerging market countries and with fewer people working to provide for those who retire, governments are encouraging people to turn to these companies for their retirement needs;

2. globalization produces consolidation, which may provide astute investors the opportunity to capture premiums paid by acquirers and share in the synergies that well-run companies gain from rationalization; and

3. financial trading has become internationalized and new products continue to be developed, providing additional revenues for financial institutions and more efficient ways to hedge their risks.

New Star believes that the attraction of the financial services sector is that it is one of the largest and most diversified sectors within global stock markets. There are a large number of sub-sectors within the global financial services sector including; savings banks, regional banks, mortgage banks, broker dealers, asset managers, life insurance, non-life assurance (including reinsurance) and specialty finance (credit cards, leasing, financial guarantors, etc). This diversity allows the Investment Manager to find attractive investment opportunities at every stage in the investment cycle. New Star will not hesitate to have a zero weight in a particular sub-sector.

Current Outlook

In New Star's opinion an environment of global economic growth, low inflation and low interest rates (compared to historic levels) provides a positive outlook for the global financial services sector. This view is supported by:

1. strong capital markets over the last few years;

2. high underlying asset values supporting secured lending;

3. low bad debt expectations since 2002;

4. increasing demand for loans, especially in Continental and Eastern Europe; and

5. significant merger and acquisition activity.

New Star believes that although inflation expectations, and therefore interest rates, have risen recently, this trend will reverse over the coming months. As a result, despite concerns over the impact of a slowdown in US economic growth, there are significant investment gains that may be made amongst a number of financial companies by considering specific themes within the financial sub-sectors. In particular, opportunities currently exist in:

1. European banks which are exposed to faster growing economies in Eastern Europe where the level of consumer credit and household debt is well below those of developed economies in North America and Western Europe;

2. private banks and asset management companies which are participating in the growth of global wealth and the demand for alternative investments such as hedge funds and private equity;

3. selective investment banks which are accessing strong deal flow in primary and/or secondary markets; and

4. life insurance companies which are benefiting from increased demand for savings and other investment products.

Following a downturn in markets in the early part of the decade, a number of financial services companies completed a thorough cost cutting exercise and, in New Star's opinion, have emerged with much lower cost structures. New Star believes that this, combined with the general leverage of financial services companies to rising markets, offers the potential for exceptional operating leverage for financial services companies with the resultant strong profit and cash flow generation as well as the opportunity for dividend growth.