j~Åèì~êáÉ=_~åâ=iáãáíÉÇ j~Åèì~êáÉ=_~åâ=iáãáíÉÇ j~Åèì~êáÉ=_~åâ=iáãáíÉÇ j~Åèì~êáÉ=_~åâ=iáãáíÉÇ Operational Briefing Operational Briefing Kim Burke Kim Burke Group Head Group Head Equity Markets Equity Markets
lìíäáåÉ � Recap Equity Markets’ Business Model � Update trading conditions in key markets, and market risk position � Operational Highlights � Strategic Focus OU
bjd=_ìëáåÉëë=jçÇÉä • Equity-linked structuring, distribution, risk management Core Equity Markets Group • Hedge fund management and distribution Activities • Arbitrage style proprietary trading of equities Financial Risk Core Equity Product Management Derivatives Expertise Distribution Innovation Key Equity Product and Market Volume and Result Growth Conditions Margin Drivers Increasingly Customer Geographic Product Diversified Type Earnings OV
pí~ÑÑ=~åÇ=içÅ~íáçåë= eÉ~Ç=lÑÑáÅÉ pìééçêí= NPS qê~ÇÉ=pìééçêí pÉííäÉãÉåíë nì~åíáí~íáîÉ fåÑçêã~íáçå pìééçêí qÉÅÜåçäçÖó eìã~å= iÉÖ~ä= oÉëçìêÅÉë `çãéäá~åÅÉ ^ìëíê~äá~ ^ëá~ _ê~òáä bèìáíó=cáå~åÅÉ fåíK=píêìÅíìêáåÖ pçìíÜ=^ÑêáÅ~ rpL=bìêçéÉ OM UU TO NO NQ R NP cìåÇ= eçåÖ=hçåÖ 360 Staff in 13 mêçÇìÅíë g~é~å Locations bèìáíó mêçÇìÅíë hçêÉ~ páåÖ~éçêÉ fåëíáíìíáçå~ä== mêçÇìÅíë= PM
j~êâÉí=`çåÇáíáçåë J ^ìëíê~äá~ Prices Volumes Volatility � ASX 200 continuing to set record highs � Supporting strong investor demand 5500 15% 3 Month Rolling Average Turnover 5000 4500 Volatility 10% 4000 3500 3000 5% Jan-04 Feb-04 Mar-04 Apr-04 May-04 Jun-04 Jul-04 Aug-04 Sep-04 Oct-04 Nov-04 Dec-04 Jan-05 Feb-05 Mar-05 Apr-05 May-05 Jun-05 Jul-05 Aug-05 Sep-05 Oct-05 Nov-05 Dec-05 Daily Turnover ASX200 Index Volatility PN
j~êâÉí=`çåÇáíáçåë J eçåÖ=hçåÖ Prices Volumes Volatility � Market volumes have declined since September 2005 � Investor demand has moderated accordingly 20000 25% 19000 3 Month Rolling Average Turnover 18000 20% 17000 16000 15% Volatility 15000 14000 10% 13000 12000 5% 11000 10000 0% 4 4 4 4 4 4 4 4 4 4 4 4 5 5 5 5 5 5 5 5 5 5 5 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 - - - - - - - - - - - - - - - - - - - - - - - b r r y g p t v b r y l g p t v n n l c n n c u c u c a p p a e a u u e o e a e a u u e o e J O J O M A A J F M J A S N D J F M J A S N D Daily Turnover Hang Seng Index Volatility PO
j~êâÉí=oáëâ=~åÇ=oÉÖìä~íçêó=`~éáí~ä � VAR and regulatory capital usage remaining relatively constant 30 Regulatory 99% 10 day VAR 25 60 Day Average of Reg. VAR 20 15 10 5 0 Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 PP
léÉê~íáçå~ä=eáÖÜäáÖÜíë=J ^ìëíê~äá~ � Australia Equity Products Division maintained leading market positions in ASX Listed Warrants and Instalments ASX Listed Warrants and Instalments Market Share 700 Rest of Market 600 MBL Share 500 $A(Million) 400 300 200 100 - 4 5 4 5 5 4 4 4 4 4 5 5 5 5 5 5 5 4 4 5 5 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 - - - - - - - - - - - - - - - - - - - - - v v n l n n l r y g p t c b r r y g p t c u u p a p c o c o u a u a u e e e a u e e J J A O M A O N N J D J J D M A S F M A S * Source ASX PQ
léÉê~íáçå~ä=eáÖÜäáÖÜíë=J ^ëá~ � Asian equity linked product sales below recent highs due to overall market conditions. Mix of underlyings is broadening due to changes in investor preference. Asian Equity-linked Sales by Underlying Asset Jurisdiction Multi-Market Australia Japan Europe Taiwan Korea Singapore US Hong Kong May-04 May-05 Apr-04 Aug-04 Nov-04 Mar-05 Apr-05 Aug-05 Nov-05 Jun-04 Jul-04 Sep-04 Oct-04 Dec-04 Jan-05 Feb-05 Jun-05 Jul-05 Sep-05 Oct-05 Dec-05 PR
léÉê~íáçå~ä=eáÖÜäáÖÜíë=Ó eÉÇÖÉ=cìåÇë � Recent raisings in Newton Retail funds and Equinox Fund of Funds from Australian and European retail investors. Continuing to grow Funds Under Risk Management. Funds Under Management FUM and FURM Funds Under Risk Management 3,000 2,500 2,000 $AMillion 1,500 1,000 500 0 May-04 Jun-04 Jul-04 Oct-04 Nov-04 Dec-04 Jan-05 Feb-05 Mar-05 May-05 Jun-05 Jul-05 Oct-05 Nov-05 Dec-05 Sep-04 Sep-05 Apr-04 Aug-04 Apr-05 Aug-05 PS
léÉê~íáçå~ä=eáÖÜäáÖÜíë=J eÉÇÖÉ= cìåÇë Composition of Hedge Fund FUM 700 600 500 $A Millions 400 300 200 100 0 Fund of Funds FUM Single Strategy FUM Total FUM Absolute Return Global Futures Asia Long/Short Absolute Return Equinox Apollo Special Events Multi-Strategy Titan Other Buy-Write PT
léÉê~íáçå~ä=eáÖÜäáÖÜíë=J eÉÇÖÉ= cìåÇë � Consistent positive returns across all fund products Incubated Managers Fund of Funds Single Strategy Funds Average 19.10% Absolute Return 3.38% Titan I 10.07% Special Events 8.19% Performance Titan II 8.19% Buy Write 11.66% Apollo 9.06% Equinox Class A 6.76% Futures Fund 19.15% Equinox Class B 6.79% Futures Fund - Enhanced 31.01% Equinox Class C 5.53% Asian Enhanced Yield 21.17% Equinox Class D 1.74% Asian Statistical Arbitrage 21.08% Equinox Class E 5.68% Asian Long Short 19.14% Equinox Class F 4.79% Equinox Trust (6) 2.87% Equinox Asia 1.81% * 12 month Compound Rolling Returns. Some Fund of Fund numbers are estimates. Performance for strategies and funds with less than 12 months of data are annualised PU
léÉê~íáçå~ä=eáÖÜäáÖÜíë=Ó líÜÉê � International Structuring raised €107 million in Germany in relation to equity linked investments in Nov/Dec 05. � JVs in Korea (Woori Bank) and South Africa (Nedbank) continuing to perform well. � New US office now hedging products for Asian and Australian distribution. Performing well in first year of operation. � Brazil office commenced market making in exchange traded options. PV
píê~íÉÖáÅ=cçÅìë � Asia - transitioning to full service regional model: � All major markets covered � Full product range including multi-market � Full coverage of retail, HNW and institutional clients � Leveraging Macquarie Securities’ presence � Hedge Funds: � Increase asset management and research capabilities in Asia with local resources in Hong Kong and Tokyo � Obtain SEC registration for single strategy asset management � Integrate with other EMG global distribution teams � Australia Equity Products: � Increasing focus on corporate and institutional products � Online CFD platform – continued enhancement � International Structuring: � Significantly grow European distribution platform QM
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