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Traxis Fund Confidential

The information and any disclosures provided herein are in summary form and have been prepared for informational purposes for investors of the Traxis

Funds. Please refer to the confidential offering memorandum of the Fund in which you invest (the Memorandum) for more detailed information and

disclosures. The information and any disclosures provided herein may be considered confidential. Any use, distribution, modification, copying, forwarding

or disclosure by any person is strictly prohibited. The information and any disclosures provided herein do not constitute a solicitation or offer to purchase

or sell any security or other financial product or instrument. The current month performance data herein is an estimate. Past performance does not

guarantee future returns. There can be no assurance that any Fund will achieve any targeted rates of return, and there is no guarantee against the loss of

your entire investment.For Investor/Qualified Prospective Investor use only: This material may not be reproduced, shown or quoted to anyone other than

the intended user.

1

Performance Review February 28

(February 1 through February 28)

February YTDAnnualized SinceInception (6/2/03)

Traxis Fund LP Gross Return1

-4.63% -10.42% 4.56%

Traxis Fund LP Net Return (1.5% Fee)2 -4.78% -10.66% 0.65%

Traxis Fund LP Net Return (2.0% Fee)3

-4.82% -10.74% 0.22%

S&P 500 Total Return4, 5

-10.65% -18.18% -2.70%

MSCI All Country World Index Total Return4, 6

-9.73% -17.41% 0.64%

US Government 10 Year Note -1.36% -5.88% 4.47%

Past performance is no guarantee of future results and current performance may be higher or lower than theperformance quoted. See important footnotes 1-6 in section called Notes to Performance.

Monthly Performance (%)

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

2003 Gross1 - - - - - 2.79 4.23 5.71 1.66 2.78 -0.91 3.66 21.55

Net (1.5% Fee)2

- - - - - 2.10 3.26 4.50 1.23 2.16 -0.87 2.89 16.21

Net (2.0% Fee)3

- - - - - 2.07 3.23 4.46 1.19 2.12 -0.90 2.85 15.93

2004 Gross1 -0.54 -0.92 1.12 1.35 -3.63 1.18 -4.94 1.60 -3.45 -0.14 1.58 6.78 -0.53

Net (1.5% Fee)2 -0.70 -1.06 0.98 1.13 -3.68 0.94 -5.08 1.44 -3.60 -0.28 1.40 6.63 -2.38

Net (2.0% Fee)3 -0.74 -1.10 0.94 1.12 -3.75 0.90 -5.12 1.39 -3.64 -0.32 1.36 6.58 -2.86

2005 Gross1 -0.38 1.48 -2.06 -0.70 1.49 0.16 3.58 1.72 6.01 -3.11 4.70 3.18 16.86

Net (1.5% Fee)2 -0.48 1.33 -2.23 -0.86 1.33 0.00 3.51 1.29 4.83 -2.73 3.80 2.54 12.71

Net (2.0% Fee)3 -0.53 1.29 -2.27 -0.90 1.29 -0.04 3.49 1.39 4.78 -2.76 3.76 2.50 12.35

2006 Gross1 4.32 0.09 1.08 2.88 -7.10 0.92 0.57 2.75 1.35 3.13 1.97 1.50 13.79

Net (1.5% Fee)2 3.54 -0.05 0.79 2.21 -5.89 0.61 0.34 2.08 0.96 2.43 1.48 1.10 9.70

Net (2.0% Fee)3 3.50 -0.09 0.76 2.18 -5.92 0.58 0.31 2.04 0.93 2.39 1.45 1.07 9.26

2007 Gross1 1.17 -0.01 1.13 3.39 3.65 1.99 1.89 -2.38 7.78 8.53 -4.30 -0.45 23.93

Net (1.5% Fee)2 0.83 -0.13 0.76 2.60 2.82 1.48 1.41 -2.08 6.23 6.93 -3.73 -0.60 17.24

Net (2.0% Fee)3 0.80 -0.17 0.73 2.56 2.79 1.45 1.38 -2.11 6.19 6.88 -3.76 -0.63 16.76

2008 Gross1 -6.23 -0.86 -4.11 7.05 -0.46 -4.61 1.18 -0.58 -8.19 -11.18 -5.77 3.36 -27.61

Net (1.5% Fee)2 -6.38 -1.02 -4.27 6.91 -0.61 -4.76 1.02 -0.74 -8.52 -11.52 -6.05 3.22 -29.34

Net (2.0% Fee)3 -6.42 -1.06 -4.31 6.86 -0.65 -4.80 0.98 -0.78 -8.56 -11.56 -6.09 3.17 -29.70

2009 Gross1 -6.07 -4.63 -10.42

Net (1.5% Fee)2 -6.18 -4.78 -10.66

Net (2.0% Fee)3

-6.21 -4.82 -10.74

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Investment Commentary

This is now officially the worst start of the year for stocks in nearly 80 years. January had thebiggest fall for any January in history, February was another horrendous month for equitymarkets around the world and, at the time of this writing, March is shaping up no differently.After a sickening 37% decline in 2008, the S&P 500 is now already down 25% for the year, theNew York Stock Exchange Index has collapsed 34.6% and the US banking index is down astaggering 60%. We ran a modest net long most of last month and still lost a mostdisappointing 4.6% on the month.

These are very discouraging times. In addition to the epochal financial and economic crisis theworld confronts, there are passionate arguments as to whether stock declines are acceleratingbecause of investor dismay with President Obamas program to redistribute the wealth orbecause the economic agenda of the new administration is not big enough or specific enough.Although the new Presidents approval rating on the latest Washington Postpoll is still high andrising, some argue the steep fall in stock prices since the inauguration argues his standing withthe stock market is in a steep decline. The fear and even conviction is swelling that the world isplunging toward a depression analogous to that of the 1930s.

It is different this time

Debt deflation cycles are different and global economic activity continues to disappoint alreadypessimistic expectations. As the data filter in, we estimate that Q4 GDP shrank at a 5.7% ratefor the global economy, which is worse than any quarter in the two deep post war recessions of

Significant Contributors Significant Detractors

LongRussiaStocks LongUSStocksS&P500

LongUSHomeBuilderStocksRelativetoS&P500 LongUSStocksSmallCapValue

LongEuropeShortRates LongEmergingMarketsStockIndex

LongUSDrillers/ShortUSIntegratedOilStocks LongTurkeyBankStocks

Short10and30YearUSTreasuries LongChinaPropertyStocks

US2yr/10yrYieldCurveSteepener LongEMEACorporateCredit

ShortEmergingMarketsMetalStocks ShortJapanStocks

LongThaiBanks/ShortEMIndex LongIndiaStocks

ShortAustraliaStocks LongGlobalBankStocks

ShortProtectiononUSFinancialsCDSBasket LongGermanyStocks

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1974 and 1982. This was driven by the USs 6.2% decline, Europes -5.8% and Japans -12%,ably assisted by bungee jumps of -20% to -30% in growth in Taiwan, Korea and Singapore.

We have taken down our estimates of global growth for the next 4 quarters and have pushed outany semblance of recovery well into the second half of the year (See Table 1). If this forecast

turns out close to being right, the US economy will have declined 4.0% peak to trough, worsethan 1974s 3.1% decline and 1982s 2.6%. Note that the prior two recessions only saw declines

of 0.5% on average so thiswould be 8 times worse. TheUS unemployment rate willmost likely peak at 10%,much higher than 2003s6.4% and the 7.8% reachedin the early 1990s recession(remembered by the

infamous joblessrecovery). For the globaleconomy, the peak to trough

decline will likely be 3% driven by the worst decline in economic activity since WWII fordeveloped economies (-4%) and decline in EM activity (-1.1%),worse than in 1998 (-0.8%).

It has become increasingly clear that we are entering entirely uncharted territory. Most of ourunderstanding of modern financial markets is based on the Post War period. Our understandingof the relationships between financial markets and economic factors, such as growth, inflation,monetary and fiscal policy, has also been shaped by the experience and the analysis of the past50 years.

Value investing and economic mean-reversionFor example, one of the most successful investment strategies for the past 50 years has beenvalue investing: buying the cheapest stocks while avoiding the most expensive stocks. The basicpremise of this strategy is that the market will tend to overprice the risk of failure or bankruptcyof certain companies and thus result in the valuation of these companies being significantlybelow that of the rest of the market. A systematic dispassionate allocation to lowly valuedcompanies relative to highly valued companies has resulted in significant positive performanceover any kind of medium-term horizon. Using the simplest of those value strategies (buying lowP/Book and shorting high P/Book) has returned 4.2% p.a. from 1945 to 2006 (with no market

exposure - see Chart 1). The one-year return of this market-neutral strategy initiated 9 monthsinto every post-war recession would have returned 7.1% on average. However, the experienceof the past 18-24 months has highlighted that part of the reason this strategy was so successful

Q3 Q4 Q1 Q2 Q3 Q4

US 0.5 6.2 6.5 3.0 1.0 1.5

EMU 1.0 5.7 6.0 2.0 0.0 1.5

UK 2.8 6.0 4.0 1.5 1.5 2.0

Japan 2.3 12.7 8.0 2.0 1.5 2.0

China 6.4 1.5 5.0 6.5 7.5 8.0

RestofEM 3.1 5.6 4.8 0.6 2.4 3.5

Restof

Dev 0.0

2.5

5.0

1.5 0.0 2.0

WORLD 0.3 5.7 5.1 1.3 1.4 2.4

Table1:TraxisQuarterlyGlobalGDPForecasts

2008Actuals 2009Forecasts

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was not so much because of its intrinsic buy cheap, sell dear wisdom. Rather it might simplyhave succeeded because the average recession in the post-War period only lasted 10 months and

so, if in every bear market, six or nine months into the recession, one were to have bought thestocks most affected by the downturn (i.e., the lowly valued stocks), inevitably within a fewmonths, an economic recovery would arrive and would drastically reduce the risk of failure anddefault of these companies. They would then benefit from the most dramatic re-pricing andvalue would outperform. On the other hand, if the recession were to last 44 months as it didbetween 1929 and 1933, most lowly valued stocks would continue to underperform as the riskof failure (and actual failures) would dramatically increase with each passing month of therecession. Not surprisingly therefore, value stocks underperformed by -25%, -35% and -6% in1930, 1931 and in 1H 1932 respectively, for a massive -54% underperformance over the cycle.(The following year was a different story: +120% for value stocks vs +44% for the market). In

other words, the value stocks have mean-reverted powerfully in the post war period economiccycles because the economic environment has mean-reverted and the economic ship hasrighted itself relatively quickly each time. In the few unusual, deep and long recessions such asthe Great Depression, the relationship has disconnected as in this cycle so far. One of the mostimportant questions to gauge which investment strategy to adopt therefore must be: how likelyis it that the U.S and global economy slip into a depression similar to the Great Depression ofthe 1930s? In other words, is our economic forecast bearish enough?

The Great Depression by the numbers:We have studied the Great Depression in depth and found that, despite the similarities between

the current period and the early 1930s, there were many more differences that make anythingclose to a repeat extremely unlikely. It might be useful to recap how bad the US economy didindeed get in the 1930s and compare that to the next worst recession to get a sense of what thisrecession would have to look like to qualify as Great Depression II.

1

10

1944 1949 1954 1959 1964 1969 1974 1979 1984 1989 1994 1999 2004

Chart1:SimpleValueStrategyRelativePerformance*

*LowP/Bookvs.HighP/Bookindex;usesRussellandFama/Frenchstyleindicesasavailable

AnnualizedReturn

through2006:4.2%

AnnualizedReturn19452006:

LowPrice

/BookPortfolio: 15.3%

S&P500: 11.9%

HighPrice/

BookPortfolio: 10.7%

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19291932/1933 NextWorstInstance*

S&P500Decline 87% 49% (0002)

RealGDPDecline 33% 3.2% (5758)

NominalGDPDecline 50% 2.7% (58)

Lengthof

Recession

3.7

years 1.3

years

(73

75)

IndustrialProductionDecline 54% 14% (58)

EPSdecline 75% 54% (0002)

Dividenddecline 55% 16% (7375inrealterms)

PeakUnemploymentrate 25.6% 10.8% (82)

*1950to2007,excludingcurrentepisode

In economic terms, using real GDP decline, the Great Depression was therefore ten times worsethan any other recession in the post-war period. In stock market terms, it was 3 times worse as it

halved three consecutive times to decline nearly a whopping 90%.

There are many competing explanations for the Great Depression, all significantly influenced byphilosophical biases, be they Keynesian, Monetarist, Austrian, or other. Charles Kindleberger inhis seminal book, The World in Depression 1929-1939, described the main causes asconsiderable instability in the system and the absence of a stabilizer and dismisses the usualdebate between Keynesians and Monetarists whether the failure of the money supply to growled to a decline in spending, or whether an independent, autonomous decline in spending led to adecrease in the money supply? Our read of the history is that the depth of the Depression wascaused by a combination of existing imbalances and excesses which needed to be redressed,

combined with poor policy responses and significant systemic weaknesses.

The world in 19291) Imbalances and excesses included:- A very overvalued stock market (trading at 25x normalized earnings)- A high degree of speculation (e.g., broker loans of $8,515m on Oct. 4, 1929 or 10% of

market cap)- Excessive leverage in the economy (with total credit at 200% of GDP)- Overinvestment in capital goods and housing (though housing peaked earlier, in 1925, when

the Florida land boom turned to bust)

2) Systemic weaknesses included:- the lack of FDIC insurance (9,000 banks failed with depositors losing most of their money)

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- the lack of automatic stabilizers such universal unemployment insurance (which wasimplemented only as part of the Social Security Act of 1935)

- what John Kenneth Galbraith labeled in his book The Great Crash, the poor state ofeconomic intelligence by which he meant a relatively primitive understanding of the toolsof economic policy-making which led to some significant policy errors

3) Significant policy errors included:- raising interest rates during the economic contraction in 1931 to support the dollar- raising taxes in 1932 as balancing the budget was an article of faith of both parties in 1930s- maintaining the gold standard until 1932 (Bernanke & Harold James in The Gold Standard,

Deflation, and Financial Crisis in the Great Depression have shown that the earlier acountry left the gold standard the earlier and the better it recovered)

- starting a global trade war with the passing of the Smoot Hawley tariff in 1930

Reviewing these factors, it is relatively clear, disturbingly, that some of the imbalances that

preceded the Great Depression (as outlined above) have much in common with some of theimbalances which preceded this recession - in particular, excessive leverage and speculation(particularly in credit markets). In many ways, the leverage in the system today is actually muchgreater than in 1929 (though perhaps not entirely comparable given the different stage ofeconomic development in 1929). (See charts 2 and 3 of total credit to GDP today vs 1930s).

Source: Federal Reserve, BEA, Morgan Stanley Research

Chart2:Creditasa%ofGDPinTheGreatDepressionTotalDebtOutstandingbySector

Government

CorporatesHouseholds

Financials

350

300

250

200

150

100

50

0Jan Nov Sep Jul May Mar Jan Nov Sep Jul May Mar Jan Nov Sep Jul May

20 21 23 25 27 29 31 32 34 36 38 40 42 43 45 47 49

DebtLiquidationin1930sand1940s1929

200%

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It is also relatively clear to us that most of the systemic weaknesses that compounded whatsurely would have been a nasty recession into the worst economic debacle of the century havebeen remedied and the policy errors are unlikely to be repeated (at least not the same ones). Forexample:

1) Though banks have already failed and many more will go under in this recession, theFDIC has a relatively streamlined process for taking over the insolvent institutions whileguaranteeing that depositor assets are safe, which will prevent negative second and thirdround effects of bank failures.

2) In a monetary policy that is already the most proactive this century, the Fed moved toquantitative easing within 12 months of the start of the crisis. This does not guarantee thatpolicy will be effective immediately but it makes an enormous difference to the entirefinancial system and the economy that the Fed stands ready to provide liquidity and crediteven as a substitute to the private banking system (See charts 4 and 5 on Money Supplytoday vs 1930s).

3) Despite the widespread job losses, the economic impact of unemployment is much lessdramatic due to the universal nature of the current unemployment insurance system(extended an additional 13-20 weeks recently).

0

50

100

150

200

250

300

350

400

1952 1957 1962 1967 1972 1977 1982 1987 1992 1997 2002 2007

Chart3:Creditasa%ofGDPSince1952TotalDebtOutstandingbySectorthroughSeptember2008

Households

Corporates

Financials

GSE

Government

Total=350%ofGDP

Levering

up

since

1982

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4) We do have serious misgivings about the US stimulus package (its size, composition, theexpectations of a multiplier greater than 1 and its impact on the long-term indebtedness ofthe country) but it is clear that, at least, this time around, no party is thinking of anythingas counterproductive as raising taxes in this downturn.

5) In terms of the dollar, it is clearly unhelpful that the dollar has appreciated over 20% inthe past 12 months but it remains fairly valued on most estimates of PPP and therefore

should not be a significant impediment for US exporters.

720870

1020

1170

1320

1470

1620

1770

1920

2070

2220

2370

Jan06 Jan07 Jan08 Jan09

Chart5:M1andMonetaryBaseToday(US$Billions)

M1

Monetary Base

15%

87%

18

20

22

24

26

28

30

32

1929 1931 1933 1935 1937

Chart4:M1in1929 1937(US$Billions)

27% contractionin NarrowMoneySupply

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Probable economic path; Debt liquidation or socialization?Our conclusions from this analysis are that, despite many similarities in the imbalances between1929 and 2007, the almost diametrically opposed policy responses as well as the many built-insystemic safeguards make a repeat of the Great Depression extremely unlikely. (We are howeveraware of wisdom in the quip Those who dont study the past will repeat its error. Those who

do study it will find new ways to err.). A much more likely outcome is one where thenecessary economic adjustment required in resolving our imbalances will be spread out overtime. In the 1930s, after a debt liquidation - driven 30% collapse in real GDP (Andrew Mellonsinfamous liquidate everything mantra), the economy rebounded by nearly 50% in thesubsequent 3 years such that the 1929 peak in activity was fully recovered by 1937. Actually, inthe 20 years that followed the 1929 peak, the economy grew 73% (including the Depression)(See chart 6).

On the other hand, Japan in the 1990s and 2000s provides a reasonable case study for whatsmoothing the adjustment over time may resemble. It had a similar stock market and real estatebubble which caused a serious banking crisis and ultimately resulted in a prolonged period ofweak growth. Japans debt binge of the 1980s was effectively socialized by the government andtotal debt outstanding was never liquidated, simply transferred from the private sector to thepublic sector. As a result, Japans economic downturns were nowhere near as severe as aDepression (on average -3.6% peak-to-trough decline in real GDP) but by the end of 2010, 20years after the peak of its bubble, Japans GDP growth will only be 19% above where it was in1989 (See chart 7). The implications are clear: massive fiscal and monetary stimulus (including

zero interest rates and quantitative easing) and a full-scale bailout of the banking sector by thefederal government were successful in preventing a Depression as well as its attendant traumaand politically unacceptable social costs but not in preventing the necessary and inevitableworkout of the structural imbalances and excesses in the economy. So the cost of spreading the

600

750

900

1050

1200

1350

1500

1650

1800

1950

1929 1931 1933 1935 1937 1939 1941 1943 1945 1947 1949

Chart6:USRealGNPfrom1929to1949(US$Billions)

+73%(or+2.8%peryear)

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adjustment over time is lower terminal wealth and lower GDP but ostensibly lower social costs

in the smoother, less disruptive adjustment. So far in this cycle, we seem to be heading forJapan-style scenario of socializing the excess debt through the (See chart 8) various (global)bailouts and stimulus packages in an attempt to smooth the adjustment over a longer period.Interestingly, despite the very different policy responses and economic paths chosen, markets, itappears, are difficult to fool. Japanese equities declined almost as much as the Dow did duringthe depression and as the Topix continues to make new lows 20 years after its peak, the recoveryin Japan is clearly taking longer than it did for the Dow Jones in the 1930s.

Source: BoJ, IMF, Morgan Stanley Research

Chart8:Creditasa%ofGDPinJapan400

350

300

250

200

150

100

50

0

Government

Corporates

Households

1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006

420

440

460

480

500

520

540

560

580

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010

Chart7:JapanRealGDPfrom1990to2010(Yen)

+19%(or+0.90%peryear)

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From a valuation perspective, other than the Great Depression, all other secular bear marketlows (1938, 1942, 1974 and 1982) occurred at equity valuation levels between 7-11x normalizedEPS (or 9-12.5x Graham-Dodd P/E) which corresponds to 500-700 on the S&P (See chart 9).

Those lows were secular bear market lows in that real returns from those lows over any horizon(a month, a year or a decade) were always positive. At 9.9x normalized earnings, we have nowentered that zone of secular undervaluation where subsequent future returns for the next twoyears will likely be a massive 50-100%. What will determine where in this zone we bottom outand when value begins to get unlocked will be a function of when the economy turns, as wasthe case in 32, 38, 74, and 82 (see chart 10). The reason

4.3x

10.7x

7.1x10.4x

7.9x9.9x

0

5

10

15

20

25

30

35

40

1927 1932 1937 1942 1947 1952 1957 1962 1967 1972 1977 1982 1987 1992 1997 2002 2007

Chart9:NormalizedP/E(BasedonReportedEarningsNormalizedvsGDP)

Ave.16.0

1938,1942,1974,1982MedianNormP/E=9.2x

4

6

8

10

12

14

16

18

4

5

6

7

8

9

10

1931 1932 1933 1934 1935 1936 1937 1938

Chart10:In1932and1938,StocksBottomedWhenEconomicActivity

(IndustrialProduction)Turned

S&P500 (RHS)

IndustrialProductionIndex(LHS)

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to exclude 1932 from this valuation analysis is that it took a depression with industrialproduction down 54%, GDP down 30% to get stock market valuations in 1932 down to 4xnormalized earnings or the equivalent of 250-300 on the S&P today (rather than 9.2x at the othersecular lows1). As we have been discussing in this letter, we view an economic decline of that

magnitude as very unlikely. We believe 38, 42, 74, 82 represent economic conditions direenough to be our most likely worst case. For example, in 1938, the economy shrank by 13.2%,unemployment was still 20%, and stocks still bottomed at 10.7x normalized P/E (or 9.6xGraham-Dodd), not 4x.

An examination of the history of the relationship between stocks and bonds is illuminating aswell. Chart 11 shows the performance of the S&P 500 versus the thirty year U.S. Treasury bond.Note that as of today the great bull run of the 1980s and 1990s has been completely reversed.1932 represented a 32 year round trip in stocks returns versus bonds returns. This currentepisode constitutes a 29 year round trip (and almost a 41 year one).

As Bernard Baruch wrote in 1932 as a foreword to the publication of the new edition of CharlesMackays great classic,Extraordinary Popular Delusions and the Madness of Crowds;

1 As a side note, those abnormally depressed valuations of 1932 (near 4x normalized earnings) werefollowed by a 180% rally in the subsequent 12 months and 400% real returns in the subsequent 4 years.

0

1

2

3

4

5

6

7

8

9

10

1965 1970 1975 1980 1985 1990 1995 2000 2005 2010

Chart11:USStocksvsUSLongtermBonds:RelativeTotalReturn

A29yearroundtrip...

...andalmosta41year

roundtrip.

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Although there be no scientific cure, yet, as in all primitive, unknown (and therefore diabolic)

spells, there may be potent incantations. I have always thought that if, in the lamentable era of

the New Economics culminating in 1929, even in the very presence of dizzily spiraling

prices, we had all continuously repeated two and two still make four much of the evil might

have been averted. Similarly, even in the general moment of gloom in which this is written, whenmany begin to wonder if declines will never halt, the appropriate abracadabra may be: They

always did.

Barton M. Biggs Madhav Dhar Cyril Moull-Berteaux Amer Bisat

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Traxis Fund LP Exposure Report as of February 28, 2009

Estimated Exposure4

Net Gross Long Gross Short Total Gross

Equity

US 9.1% 15.0% -5.9% 20.9%

Europe 0.0% 2.3% -2.3% 4.6%

Japan 0.0% 0.7% -0.7% 1.4%

Emerging Markets 17.4% 22.4% -5.0% 27.4%

Rest of World1 -1.0% 0.0% -1.0% 1.0%

Total Equities 25.5% 40.4% -14.9% 55.3%

Fixed Income2

US 11.0% 16.0% -5.0% 21.0%

Europe 5.0% 5.0% 0.0% 5.0%

Japan 0.0% 0.0% 0.0% 0.0%

Emerging Markets 7.3% 7.3% 0.0% 7.3%

Rest of World1 0.0% 0.0% 0.0% 0.0%

Total Fixed Income 23.3% 28.3% -5.0% 33.3%

Opportunistic

Currencies3 -4.2% 0.0% -4.2% 4.2%

Metals 0.0% 0.0% 0.0% 0.0%

Energy 0.0% 0.0% 0.0% 0.0%

Total Opportunistic -4.2% 0.0% -4.2% 4.2%

TOTAL FUND nm 68.7% -24.1% 92.8%Portfolio VaR

5= 7.8%

1 Australia, Hong Kong, Singapore, Canada, New Zealand2 All expressed in US 10-year note equivalent terms3 Gross Long, Gross Short = Long, Short USD4 Figures may not add due to rounding5 Monthly, 95% confidence Value-at-Risk. Since October 2008, calculation uses equal weights

on the past 12 months of historical data rather than exponential weights, which results in alower VaR calculation following periods of relatively high market volatility.

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Notes to Performance

1 The estimated gross return represents the investment return of each of the Traxis Fund Onshore LP, Traxis Fund Offshore LP and Traxis Fund Offshore II LP (collectively, the Traxis Fund or the Fund), before deduction of any fees and expenses, including the management fee and incentiveallocation. Investors in the Traxis Funds will receive under separate cover a capital account statement showing their individual capital account balance

for the beginning and end of such period.2 The indices are unmanaged portfolios of securities. Their performance results do not reflect the deduction of management fees, incentive compensation,

commissions or other expenses. The performance of the indices may vary from that of the Master Fund. The Master Fund may, at times, have higher orlower volatility than any of the indices.

3 The S&P 500 Total Return Index consists of 500 stocks chosen for market size, liquidity and industry group representation. It is a market value weightedindex with each stocks weight in the Index proportionate to its market value. The index is one of the most widely used benchmarks of U.S. equity

performance. As a Total Return index, it measures the market performance, including price performance and income from dividend payments.4 The MSCI Inc. ACWI (All Country World Index) Total Return is a free-float adjusted market capitalization index that is designed to measure equity

market performance in the global developed and emerging markets. As a Total Return index, it measures the market performance, including priceperformance and income from dividend payments.

Contact Information

Fund:Timothy ShannonTraxis Partners

600 Fifth Avenue, 26th FloorNew York, NY 10020Tel: 212.332.5169Fax: 212.332.5178Email: [email protected]

Administrator:David SaulInternational Fund Services (Ireland) Limited

Third Floor, Bishops Square, Redmonds HillDublin 2, IrelandTel: (353 1) 655 8231Fax: (353 1) 707 5101Email: [email protected]

Data SourcesTraxis Partners may from time-to-time use one of more of the following data sources in the Investment Commentary, tables or charts: Bloomberg,

Markit Group, JPMorgan, Global Insight, Emerging Portfolio.com, MSCI Inc. Index (an affiliate of Morgan Stanley & Co.), Eurostat, Thomson

Facts and views presented in this Report are subject to change, and there is no guarantee that the Fund will invest in accordance with such views.

These are our views as of the date hereof and not as of any future date.

QualificationsThe information presented in this report to investors in the Traxis Funds (the Report) is highly confidential and may be delivered to investors

who previously received a Memorandum (as defined below) in Traxis Fund Onshore LP (the US Feeder Fund), Traxis Fund Offshore LP (the

Cayman Feeder Fund) and Traxis Fund Offshore II LP (the Cayman Feeder Fund II) (collectively, the Feeder Funds and individually a

Fund). This Report is not to be reproduced or distributed to any other persons (other than professional advisers of any investors receiving these

materials), and is intended solely for the use of the persons to whom it has been delivered. Any investor (and each employee, representative, or

other agent of any investor), however, may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of a

Fund and all materials of any kind (including opinions or other tax analyses) that are provided to an investor relating to such tax treatment and tax

structure. This Report has been prepared solely for informational purposes and is not an offer to buy or sell or a solicitation of an offer to buy or

sell Interests or any other security or instrument or to participate in any trading strategy. This Report should be read in conjunction with each

Funds confidential offering memorandum. Moreover, the specific terms applicable to the Interests described generally in this Report, and offered

in the Memorandum, will be governed by the terms of the applicable limited partnership agreement (the Partnership Agreement) for the US

Feeder Fund, the Cayman Feeder Fund or the Cayman Feeder Fund II, as the case may be. No representation or warranty (express or implied) is

made or can be given with respect to the accuracy or completeness of the information in this Report. No person has been authorized to make any

representations concerning the Interests described in this Report that are inconsistent with the statements contained in this Report, the

Memorandum, or the applicable partnership agreement.

There can be no assurance that a Funds investment objectives will be achieved or that there will be any return of capital. Holding an investment

in a Fund involves a high degree of risk, including the risk that the entire amount invested may be lost.

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the intended user.

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Additional information is available upon request. Traxis Partners LP and its affiliates (Traxis Partners) disclaim any and all liability relating to

this Report, including without limitation any express or implied representations or warranties for statements contained in, and omissions from, this

information.

To recipients in Canada: The information presented in this Report may be delivered by Traxis Partners or placement agents engaged by the Fund,

to permit prospective investors in the Provinces of Ontario, Qubec, British Columbia, Alberta and Manitoba only. As stated above, this Report

has been prepared for informational purposes and is not, and under no circumstances is to be construed as, an advertisement or a private or public

offer of the Interests. No securities commission or similar authority in Canada or elsewhere has reviewed or in any way passed upon this

document and any representation to the contrary is an offense.

The Interests and investment strategies described in this Report have not been registered with, or approved or disapproved by, the US Securities

and Exchange Commission, the US Commodity Futures Trading Commission, the Cayman Islands Monetary Authority, or any other US or Cayman

Islands federal or state governmental agency or regulatory authority or any national securities exchange. No agency, authority or exchange has

passed upon the accuracy or adequacy of this Report, the Memorandum or the merits of an investment in the Interests. Any representation to the

contrary is a criminal offense.

Investors should not construe the contents of this Report as legal, tax or financial advice. Each investor should consult his, her or its own

professional advisors as to the legal, tax, financial or other matters relevant to an investment in a Fund. Traxis Partners does not render advice on

tax or tax accounting matters to clients. This material was not intended or written to be used, and it cannot be used by any taxpayer, for the

purpose of avoiding penalties that may be imposed on the taxpayer under U.S. federal tax laws.

There is no guarantee that the benchmarks listed in the Performance Review on page 1 of this Report are representative benchmarks against which

the performance of a Fund should be compared.

Traxis Partners and/or each of their employees may have investments in securities or derivatives of securities of companies or in sectors mentioned

in this Report and may trade them in ways different from those discussed in this Report.

Under the Investment Advisers Act of 1940, Traxis Partners LP is required to maintain a disclosure document, otherwise known as Part II of Form

ADV. In summary, Part II of Form ADV discloses, among other things, the advisory services provided, fees charged by these entities, as well as

certain affiliations. If you would like to receive a copy of Part II of Form ADV for the entities above, please send a written request to Investor Relations, Traxis Partners, 600 Fifth Avenue, 26th Floor, New York, New York 10020 or email your request to

[email protected].

Traxis Partners does not provide tax advice. The tax information contained herein is general and is not exhaustive by nature. It was notintended or written to be used, and it cannot be used by any taxpayer, for the purpose of avoiding penalties that may be imposed on thetaxpayer under U.S. federal tax laws. Federal and state tax laws are complex and constantly changing. You should always consult yourown legal or tax advisor for information concerning your individual situation.

Risk Factors and Conflicts of InterestPlease refer to a Funds Memorandum for a more detailed discussion of risks. As the investment program of Traxis Fund LP (the Master Fund)

develops and changes over time, an investment in the Fund may be subject to additional and different risk factors from those described herein.

An investment in a Fund is a potentially suitable investment only for sophisticated investors who, in consultation with their own investment and tax

advisors, fully understand and are capable of assuming the risks inherent in investing in the Fund.

In addition, certain inherent and potential conflicts of interest exist between and among the general partners of the Feeder Funds and Master Fund

(the General Partners), the adviser to the Master Fund, and each of their respective affiliates on the one hand and the Fund on the other, as

defined and as more fully described in the Memorandum.

Investment and Trading Risks. An investment in any Fund is speculative and involves substantial risks, including risk of loss of your entire capitalinvestment. The investment program of the Master Fund, in which each Fund invests, involves significant trading risks, including risks arising

from: the volatility of the global equity, currency, and fixed income markets; short sales; leverage; the potential illiquidity of derivative

instruments; the potential loss from counterparty defaults; and borrowing. No guarantee or representation is made that the Master Funds

investment program will be successful. Investment results may vary substantially over time.

Reliance on Fund Management. The Master Funds overall success, and in turn that of each Fund, is largely dependent on the skill and expertise

of the Adviser and its principals to develop and implement the investment program and objectives pursued by the Master Fund. If any of theprincipals of the Adviser cease to be involved in the management of the Master Fund and its investment program, or if the Advisory agreement

entered into with the Adviser (the Advisory Agreement) is terminated and the Adviser no longer manages the Master Funds investment

program, each Fund could be adversely affected. There is no prohibition on any principal of the Adviser resigning.

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the intended user.

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Limited Liquidity. There is no public or secondary market for the Feeder Funds Interests, and no such market is expected to develop in the future.An investment in a Fund provides only limited liquidity through quarterly withdrawals after the expiration of a one year lock-up period, and such

withdrawal rights may be delayed or deferred as agreed upon from time to time by the General Partner and the Adviser. Investors may not transfer

all or any portion of their Interests without the written consent of the General Partner of the relevant Fund, which consent may be withheld in its

discretion and which is expected to be granted, if at all, only under extenuating circumstances.

Compensation Arrangements. The Adviser, in addition to a management fee, will receive, indirectly, compensation in the form of a fee based onthe performance of the Master Funds investments. The receipt by the Adviser of a performance-based fee may create an incentive for the Adviser

to make investments that are riskier or more speculative than those that might have been made in the absence of such a fee. In addition, the performance-based fee will be calculated on a basis that includes realized and unrealized appreciation of assets, and any such fee paid to the

Adviser may be greater than if such a fee was based solely on realized gains. In addition, a Funds fees and expenses may offset such Funds

trading profits.

Diversification. Although it is anticipated that the Master Fund will be diversified across different investment views and strategies, the MasterFund may concentrate its investments in a limited number of issuers, countries, sectors, currencies or instruments. Adverse movements in a

particular economy, sector or instrument type in which the Master Fund is concentrated could negatively affect performance and increase risk of

loss to a considerably greater extent than if the Master Funds investments were more diversified.

Leverage. The investment program will involve margin transactions, short sales, and short-term borrowings; these types of leverage can, incertain circumstances, have an adverse affect on a Fund. The Adviser may enter into option transactions, forward and futures contracts and may

buy and sell securities on margin, increasing the volatility of the Master Funds investments. Trading securities on margin, unlike trading in

futures (which also involve margin) will result in interest charges and, depending on the amount of trading activity, such charges could be

substantial. In addition, because the use of leverage will allow the Master Fund to control positions worth significantly more than its actual

investment in such positions, the amount that the Master Fund may lose in the event of adverse price movements will be high in relation to the

amount of its investment. The use of leverage will also magnify the volatility of changes in the value of the Master Funds portfolio investments.

Non-US Investments. The Master Fund may invest in securities of non-US issuers listed on non-US securities exchanges or traded in non-USover-the-counter markets. Investments in certain foreign securities may be subject to greater risks than investments in US securities due to a

variety of factors including currency controls and currency exchange rate fluctuations, changes in governmental administration or economic or

monetary policy or changed circumstances in dealing between nations. Risks associated with investing in nonUS securities may be greater with

respect to those issued by companies located in less developed countries.

Investments in Non-US Currencies. Portions of the Master Funds assets may be held or traded in securities denominated in non-US currenciesand may therefore be subject to risks associated with investments in such currencies.

Market Liquidity. During periods of limited liquidity and higher price volatility, the Master Funds ability to acquire or dispose of its investmentsat a price and time that the Master Fund deems advantageous may be impaired.

Absence of Regulatory Oversight. The Traxis Funds are not registered as investment companies under the U.S. Investment Company Act of 1940

(the 1940 Act) in reliance on an exception from the definition of investment company available to privately offered investment companies. Thesignificant investor protection provisions of the 1940 Act will not apply to an investment in the Fund.

Placement Fees and Other On going Fees. The payment of the Placement Fee and the payment of other on going fees (the latter of which are tobe paid by the Adviser or a General Partner or either of their affiliates) could create conflicts of interest between and among the General Partner,

the Adviser on the one hand, and the Feeder Fund and the Master Fund on the other. A portion of the management fee may be shared with with

placement agents engaged by Traxis Partners on an on going basis in connection with their sales of the Feeder Fund and registered

representatives may share in a portion of that fee.

Risk Management Risk management involves determining the risk of the portfolio as precisely as possible. This process implies an effort tomonitor risk, but should not be confused with and does not imply low risk. The Funds portfolio formation is designed to give it a good sense of the

risks to which the Funds portfolio will be exposed, but these estimates are subject to error.

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