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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 TraxisFunds. 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, forwardingor disclosure by any person is strictly prohibited. The information and any disclosures provided herein do not constitute a solicitation or offer to purchaseor 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 thanthe intended user.
1
 Performance Review – February 28
(February 1 through February 28)
 
February YTD
 
Annualized SinceInception (6/2/03)
 
 
Traxis Fund LP Gross Return
1
-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 Return
4, 5
-10.65% -18.18% -2.70%MSCI All Country World Index Total Return
4, 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 AprMayJunJulAugSep Oct NovDecYTD
 
2003 Gross
1
- - - --2.794.235.711.66 2.78 -0.91 3.6621.55Net (1.5% Fee)
2
- - - --2.103.264.501.23 2.16 -0.87 2.8916.21Net (2.0% Fee)
3
- - - --2.073.234.461.19 2.12 -0.90 2.8515.932004 Gross
1
 -0.54 -0.92 1.12 1.35-3.631.18-4.941.60-3.45 -0.14 1.586.78-0.53Net (1.5% Fee)
2
 -0.70 -1.06 0.98 1.13-3.680.94-5.081.44-3.60 -0.28 1.406.63-2.38Net (2.0% Fee)
3
 -0.74 -1.10 0.94 1.12-3.750.90-5.121.39-3.64 -0.32 1.366.58-2.862005 Gross
1
 -0.38 1.48 -2.06 -0.701.490.163.581.726.01 -3.11 4.703.1816.86Net (1.5% Fee)
2
 -0.48 1.33 -2.23 -0.861.330.003.511.294.83 -2.73 3.802.5412.71Net (2.0% Fee)
3
 -0.53 1.29 -2.27 -0.901.29-0.043.491.394.78 -2.76 3.762.5012.352006 Gross
1
 4.32 0.09 1.08 2.88-7.100.920.572.751.35 3.13 1.971.5013.79Net (1.5% Fee)
2
 3.54 -0.05 0.79 2.21-5.890.610.342.080.96 2.43 1.481.109.70Net (2.0% Fee)
3
 3.50 -0.09 0.76 2.18-5.920.580.312.040.93 2.39 1.451.079.262007 Gross
1
 1.17 -0.01 1.13 3.393.651.991.89-2.387.78 8.53 -4.30-0.4523.93Net (1.5% Fee)
2
 0.83 -0.13 0.76 2.602.821.481.41-2.086.23 6.93 -3.73-0.6017.24Net (2.0% Fee)
3
 0.80 -0.17 0.73 2.562.791.451.38-2.116.19 6.88 -3.76-0.6316.762008 Gross
1
 -6.23 -0.86 -4.11 7.05-0.46-4.611.18-0.58-8.19 -11.18 -5.773.36-27.61Net (1.5% Fee)
2
 -6.38 -1.02 -4.27 6.91-0.61-4.761.02-0.74-8.52 -11.52 -6.053.22-29.34Net (2.0% Fee)
3
 -6.42 -1.06 -4.31 6.86-0.65-4.800.98-0.78-8.56 -11.56 -6.093.17-29.702009 Gross
1
 -6.07 -4.63 -10.42Net (1.5% Fee)
2
 -6.18 -4.78 -10.66Net (2.0% Fee)
3
 -6.21 -4.82 -10.74
 
 
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 TraxisFunds. 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, forwardingor disclosure by any person is strictly prohibited. The information and any disclosures provided herein do not constitute a solicitation or offer to purchaseor 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 thanthe intended user.
2
 
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 Obama’s program to redistribute the wealth orbecause the economic agenda of the new administration is not big enough or specific enough.Although the new President’s approval rating on the latest
Washington Post 
poll 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
 
Long
 
Russia
 
Stocks
 
Long
 
US
 
Stocks
 
 –
 
S&P
 
500
 
Long
 
US
 
Home
 
Builder
 
Stocks
 
Relative
 
to
 
S&P
 
500
 
Long
 
US
 
Stocks
 
 –
 
Small
 
Cap
 
Value
 
Long
 
Europe
 
Short
 
Rates
 
Long
 
Emerging
 
Markets
 
Stock
 
Index
 
Long
 
US
 
Drillers
 
/
 
Short
 
US
 
Integrated
 
Oil
 
Stocks
 
Long
 
Turkey
 
Bank
 
Stocks
 
Short
 
10
 
and
 
30
 
Year
 
US
 
Treasuries
 
Long
 
China
 
Property
 
Stocks
 
US
 
2
 
yr
 
/
 
10
 
yr
 
Yield
 
Curve
 
Steepener
 
Long
 
EMEA
 
Corporate
 
Credit
 
Short
 
Emerging
 
Markets
 
Metal
 
Stocks
 
Short
 
Japan
 
Stocks
 
Long
 
Thai
 
Banks
 
/
 
Short
 
EM
 
Index
 
Long
 
India
 
Stocks
 
Short
 
Australia
 
Stocks
 
Long
 
Global
 
Bank
 
Stocks
 
Short
 
Protection
 
on
 
US
 
Financials
 
CDS
 
Basket
 
Long
 
Germany
 
Stocks
 
 
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 TraxisFunds. 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, forwardingor disclosure by any person is strictly prohibited. The information and any disclosures provided herein do not constitute a solicitation or offer to purchaseor 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 thanthe intended user.
3
1974 and 1982. This was driven by the US’s 6.2% decline, Europe’s -5.8% and Japan’s -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 forecastturns out close to being right, the US economy will have declined 4.0% peak to trough, worsethan 1974’s 3.1% decline and 1982’s 2.6%. Note that the prior two recessions only saw declinesof 0.5% on average so thiswould be 8 times worse. TheUS unemployment rate willmost likely peak at 10%,much higher than 2003’s6.4% and the 7.8% reachedin the early 1990’s recession(remembered by theinfamous “joblessrecovery”). For the globaleconomy, the peak to troughdecline 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-reversion”
For 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 marketexposure - 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
Rest
 
of 
 
EM
3.1
‐
5.6
‐
4.8
‐
0.6 2.4 3.5
Rest
 
of 
 
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
Table
 
1:
 
Traxis
 
Quarterly
 
Global
 
GDP
 
Forecasts
2008
 
Actuals 2009
 
Forecasts
of 00

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