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S P OT L I G H TS P OT L I G H T
the-elevator.net page 1the-elevator.net
First in business worldwide
Business from
the front line.
Dear Readers,
s always, let me thank you for your
continued interest in The Elevator.
Your feedback has helped the team and
me to constantly improve the magazine
over the years. I’m confident that all of
those who have followed the evolution
of our title for the last three years and
twelve issues can appreciate the changes
we’ve made and the new blend of
content we provide. To all new readers:
welcome! I hope you enjoy this issue and
the ones to come. I’m also glad to share
that our growth is attracting more and
more writers of the highest grade, which
in this issue resulted in an exclusive
exposé on Peter G. Peterson, the founder
of the Blackstone Group.
The Elevator team and I have spent the
last three months working at a fast pace,
planning and building for the time when
the global economy picks up again and
we see that the citizens of this world are
turning the psychological page and get
on our way to the biggest growth cycle
in modern history. As our team and the
HEPT Media Ltd.
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ISSN: 1662-8640
The Elevator magazine is a product of HEPT
Media. For any enquiries regarding content,
photography or licencing, contact the editor
Contributors:
Justine Doody, Madeline Thomas,
Ian McInnes, Esmé Deprez, Henry
Ball, Daniel Sharp, Patrick Gruhn,
Simon Spiess, David Johansson,
Carly Cappello
With thanks to:
Charles D’Alberto, Stephen
Pearson, Morris Shirazi, Sherry
Cannon, André Rigedahl, Anna
Lipowska, Sara Johansson, Emilie
Gruhn, Ricardo Jimenez, Laura
Stimpson, Steve York, Darren
Brown, Francois Candolfi, Asa
Johansson, Alain Sauser, Mikkel
Thorup, Arnaud Bertrand, Nicholas
Wrigley, Thierry Martin, Paul Cok.
number of our contributors is growing
with every new issue, we are planning to
increase the frequency of The Elevator
as of 2010 to go from quarterly to bi-
monthly.
It is the year of Charles Darwin’s 200th
anniversary, the man who questioned
every previously accepted evolutionary
assumption and suggested that the main
principle of life is the “survival of the
fittest”. What could actually describe
the current times better as the global
economy cleanses itself from all of those
who merely think they can be achievers?
“It is not the strongest of the species that
survives, nor the most intelligent that
survives. It is the one that is the most
adaptable to change.” – Charles Darwin
I would like to lead by example and
not waste any time on pondering and
complaining about the state of the
economy but instead be productive and
make change happen! I think now more
than ever we have the tools necessary to
build sustainable prosperity for ourselves
and those dear to us.
It is time to get creative; it is time to see
the light at the end of the tunnel and to
work towards change (not just wait for
better days to come along like so many
amongst us seem to do these days). I
think that the turn-around will come
sooner than most old school economist
predict. I believe that by the end of the
year 2009 the world will take the exit of
the route to recovery and on to prosperity
highway once again. Shouldn’t you be
prepared for when that day comes? We
are on a quest for the silver lining...
Ibelievethatbytheendofthe
year2009theworldwilltake
theexitoftheroutetorecovery
andontoprosperityhighway
From what I have seen lately, the activity
of investors is starting to spike again as
there are literally billions of investable
funds on the sidelines, waiting for
opportunities to come along. As prices
are tumbling we may see an increasing
activity in deals in the second half of
2009 as businesses consolidate and
mergers are announced or concluded.
A major novelty from our end is that The
Elevator has been licensed for the U.S.
market and should be available in major
business hotspots such as New York,
Chicago, Miami and L.A. as of this fall.
You may already see copies showing up
in selected places over the summer also.
On a more personal note I’d like to state
the observation that people, despite
trying financial times, are giving more
to those in desperate need. I very much
commend such action and hope that
everyone takes the time to reflect a little
on those less fortunate and decides not
just walks by in ignorance. I personally
enjoy giving, because I know that if
my achievements can ease someone’s
suffering for a little while I’ve done what
I set out to do…
As always I look forward to your
comments, thoughts and ideas so
that our magazine may continue to
reflect what you wish to read. Please
don’t hesitate to write or call me when
inspiration strikes!
I wish you all a very pleasant and
productive summer.
Best Regards,
Patrick Gruhn
contributerscontributers
A

54 12
44
42
34
16
6
The Getaway of Getways Page12
Quest for the ultimate urban retreat.
spotlight Page4
What works in a recession?
perla group Page20
Venturing into the Taxi-Jet market in the Middle
East.
player24seven Page26
Harnessing the power of sports and gaming.
winch energy Page30
A new player in the energy market.
HouseTrip Page32
A new portal for rental homes.
Volna Watches Page34
Uniting Swiss manufacture with Russian
iconography.
exclusive interview with Page44
Peter Peterson’s Billion Dollar Legacy
Wealth management Page36
Market Regulations - Friend or Foe?
aero toy store Page54
Where the affluent buy their toys
interview with Page42
Alain Sauser: Where’s the Watch Industry
Heading?
ALSO IN THIS ISSUE: Juice up your life; The Empire Strikes Back; Mac Attack
july09july09july09Contents
page 2 the-elevator.netthe-elevator.net
disclaimerdisclaimer
The material in this magazine does not intend
or purport to address the specific investment
objectives, financial situation, or particular
needs of any reader. It is published solely
for informational purposes and is not to be
construed as a solicitation or an offer to buy
or sell any securities or financial instruments.
Responsibility for compliance with the
securities and consumer protection laws and
regulations of authorities having jurisdiction
lies with the principals and participants in
the transactions described. Identification of,
references, and comments on third parties and
transactionsarebasedoninformationobtained
from sources believed to be reliable but are not
guaranteed as being accurate. Readers should
rely solely on diligent independent research
and their own judgment and that of their
own professional advisers. Every prospective
investor should consult his/her own legal
counsel, accountant or other professional
advisor concerning the legal, tax and economic
considerations relating to any investment.
Any statement, comment or information in
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any obligation to update or keep current the
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Past performance, whether actual or back
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fort knox
for your car
The world is full of controversy,
but that is nothing new. On the
same day, amongst many others, I
received two emails that couldn’t be
more different in nature. One was
about a homeless mother of two
who needed $1000 to get a roof over
her head and the other was about
a new real estate development in
South Florida that is offering a
fully catered facility to store man’s
most prized possession – cars. As
soon as I had taken care of the
donation for the homeless family I
swiftly went to check out this new
concept for car lovers. One of the
managers of the project, Mr Kevin
Buckley, took me on a tour of the
facility and explained that they had
thought of everything down to the
very last detail to make car owners
happy. Essentially the client buys a
glorified garage for a price between
roughly $150’000 to over $400’000,
some big enough to store more than
ten cars in one open space, fitted
with telephone, wireless internet
and complete bathrooms (including
a shower) and some units have the
possibility to include an office in an
open space gallery overlooking the cars.
He told me that the service is mostly
aimed at foreign clients who, amongst
a home and a yacht also have a car
collection in the Miami area. The Park
Place Car Condo offers everything from
maintenance to window tinting, car
concierge including airport pickup and
Exterior view of the
recently completed
facilities. Highly
secured to keep
man’s greatest
treasures safe.
2009 is the year of Charles
Darwin, British Scientist born in
1809. Darwin is considered the
father of the theory of evolution
(although this theory dates
back the Greek philosopher
Anaximander in the 6th century
BC) and is the author of the origin
of species, a theory which opposes
the theological assumption
that mankind and all of earth’s
creatures for that matter were
created by a higher power. In
July, the University of Cambridge
is holding a festival in his honor.
In certain ways, economists
have applied Darwin’s theories,
the most famous perhaps would
eventually become known as
Survival of The Fittest in modern
car delivery – basically everything that
will make the life of a car enthusiast yet
another bit better. Built with the latest
technology and safest materials, there
is also a rational side to this concept
– when a hurricane hits Florida, your
boat may sink or your house may lose
its roof but whatever happens, your
cars will be safe and sounds for your
pleasant cruise along the sunny coast
of the sunshine state.
capitalism or simply the free global
market. It is striking how such a
theory was only developed some 200
years ago since it seems so obvious,
then again it was probably better
for Darwin that he lived in the
19th century otherwise he would
have been burned or nailed to the
cross by the people of the church
for his blasphemy and witchcraft
(another interesting note: the holy
church only acknowledged in 1992
that the earth is a moving object).
In his own words: “Ignorance more
frequently begets confidence than
does knowledge: it is those who
know little, and not those who know
much, who so positively assert that
this or that problem will never be
solved by science.”
survival of the fittest
WHAT WORKS
in a recession
In every recession there are businesses that illustrate that they
are not doing the right thing. But for every business that fails in a
recession there is another that thrives.
words: Madeline Thomas
Are you positioned
right in this economy?
There is for example
a growing demand
for environmental
consultants!
The old banking model does not appear
to be recession -proof. Yet banks serve to
illustrate the point that for every business
that fails in a recession, there is another
that thrives.
In the case of the banks, the flipside is
provided by the banking lawyers – who
have probably not ventured far from their
desks in at least six months. Similarly,
employment lawyers are hard at it,
advising those soon-to-be-redundant
workers on the terms of their severance.
Litigators are also busy as worker bees
–more people sue each other in times
of economic hardship: the lure of any
financial outcome being worth the pain
of the legal proceedings.
The world would be a dismal place
indeed if the only souls to make any
money out of a recession were lawyers.
Thankfully, that’s not the case.
Broadly speaking, staple products can
provide stable businesses in recession
times. This is easily illustrated by the
most staple of products: food. We all
need to eat, whether in a recession or
not. What changes is the type of food
we choose when times are tough. So,
restaurants suffer but dial-out pizza
businesses boom because people seek
cheaper alternatives to their regular
treats.
Female grooming is another example.
It is no coincidence that hairstyles get
longer in recessionary times – they
require less maintenance. Hairdressers
therefore see a downturn in business
but there is usually a surge in sales of
home dye kits and other DIY grooming
products. People don’t do without, they
simply do it differently.
This concept can be extrapolated to
make it relevant for big business.
In recession, businesses need to show
they can do something more efficiently
andcheaperthantheirrivals.Failingthat,
they need to show value – something that
can be demonstrated in many ways and,
increasingly, in environmental terms.
There are now many financial incentives
available for businesses making
environmental changes to their working
practises. Loans from ethical banks and
government grants can persuade some
of the most recalcitrant businesses to
undergo change. Little wonder there is
a growing demand for environmental
consultants.
Advising companies on how to reduce
their environmental impact can save
them money and help them to grow
market share out of an increasingly
ethical consumer base – provided,
of course, that can be done whilst
maintaining a competitive pricing
structure.
For similar reasons, waste management
is increasingly important. Any business
that can either provide viable alternative
energy solutions or that can place
recycling at its core (or enable its clients
to do so) has hit a future-proof jackpot.
Perhaps the most vibrant area in this
recession is the start-up pool. The
concept that “if I can make it in tough
times I can really make it” is a powerful
one for entrepreneurs and the market is
abuzz with start-up talk. In business life-
cycle terms this is the ideal time to start
afresh. Willing a new initiative through
start-up uncertainty to viable fledgling
without bank backing is what provides
the economy with its growth potential
ready for when the tough times are over
- as they will be, eventually.

the elevatorthe elevator
visit www.the-elevator.net for more
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juice up
your lifeAs today’s world is taking a big toll on our bodies due to work, stress
and other factors, it is a good idea to counter the extra stress with
extra nutrition. The Floridian raw food chef Asa Johansson gave us
the latest trend:
is feeding the body nutrient dense live
food juices, but still giving it a break
in digestion so it can concentrate on
rehydrating, cleansing and rebuilding.
Freshly squeezed juices are full of
vitamins, minerals, antioxidants,
enzymes, and other nutrients that are
wonderful for our health. Raw juices
naturally contain the purest water. It
is nutrition in its whole natural state.
They taste great and will, especially
in the long run, make you feel and
look great too. They increase energy,
improve immunity and enhance overall
health. Remember, beauty starts on the
inside.
Homemadejuicesarefreefromharmful
ingredients like artificial flavors and
colors, preservatives, sweeteners and
other additives. Since they have not
been pasteurized, (heated), all the
enzymes which are naturally found
in the vegetable or the fruit, are still
present in the juice.
Like the fruits and veggies which start
losing some of their nutrients once they
are picked, a freshly squeezed juice
should be consumed right away, within
minutes. Raw juice when taken on an
empty stomach will reach the blood
stream in 15 minutes. Sip it slowly for
an optimal digestion.
To drink juices is an easy way to get our
five (or ideally more like nine!) daily
servings of fresh fruits and vegetables.
Green juices contain the most
minerals. The ultimate green juice is
wheatgrass juice. It is very cleansing
and offers the highest concentration
of chlorophyll of any plant. It contains
92 of the 102 trace elements that
are available to plants from the soil.
Chlorophyll is almost identical to
the hemoglobin molecule and acts as
“liquid oxygen” suppressing bacterial
growth and enhancing detoxification.
Wheatgrass is also rich in enzymes and
many vitamins including B17 (laetrile)
which has been shown to selectively
destroy cancer cells.
Fresh OJ in the morning (maybe mixed
with a little lemon or pomegranate
juice), a wheat grass shot in midday
and some energizing veggie juice at
night and you are on your way to a
healthy lifestyle. Get your old juicer out
or invest in the latest high-tech model
and start juicing today. Or find yourself
a juice bar and order your favorite
juice to go. Or why not get yourself a
wheatgrass shot to boost your day!
Want an extra boost of vitality? Juice
feasting is the new fasting! Juice
feasting, as the latest trend is called,
is taking a break from eating food, but
still getting all the nourishment that
raw fruits and vegetables contain in
abundance, all without the fiber. When
juice is extracted from a vegetable or
fruit, it naturally contains lots of their
nutrients without the bulk. Raw juice
is so easy for the body to assimilate. It
is digested rapidly and in the digestion
process only a small amount of energy
is needed, leaving more energy for
other activities, you name them!
Juice feasting as opposed to fasting,

life
goes
on
It seems as if the whole world is talking about
the recession; talking about how bad things are and
what they can’t do because they are too fearful to do
anything really. People have lost their money on the
stock market, in real estate or in other places. On the
other hand I‘ve spoken to quite a number of people
who have quite the opposite attitude. They are taking
fate into their own hands and refuse to submit to
a general opinion. It seems as though the so-called
crisis or recession is mostly a thing of perception - you
can either fold or raise. In terms of pure economics,
the global recession actually started in late 2007 or
early 2008 when everybody was still laughing and
spending and not worrying about anything, not even
oil at 150$ a barrel. Isn’t it funny how only when
mass communication tells us that a recession is at
hand that we fall into a mild depression and or run
around like chickens without their heads, fearing that
the world is on the verge of doom. Well, I say life goes
on and I think that if you want to be successful in the
coming years, now is the very best time to plant your
seeds and watch them grow as the economies of this
world start to recover one by one.
In many places of the world actually, life does go
on – business as usual. Don’t you wonder why that is?
I think it is all a matter of attitude so, in my ideological
way I’m simply hoping that more people will set aside
what they see on TV, what they hear on the radio
or read in the newspaper, get on their feet and start
moving because the world has never been so full of
opportunities on a global scale and its all ours to have
at the touch of a button. Remember, it doesn’t matter
if you fall down, it only matters that you get up again.
Every adversity is a challenge to overcome and every
risk usually entails some kind of reward. I’m not one
of those people who are big on motivational books
and speeches, I usually just do it and keep going until
I get the result I want. It has worked for me in the
past, it is working in the present and I hope we can
all get going and build a better tomorrow. All it takes
is a bit of creative thinking. There are industries that
are doing very well right now. A little bit of common
sense and some entrepreneurial effort and the world
is ours. So, go forth and plunder!
the empire
strikes back
Are we going to see a substantial change
in the Middle East after thirty years of
isolating politics?
words: henry ball
The formerly great and ambitious
empire of Persia that brought
innovation, evolution and culture
to this world (currently known as
the Islamic Republic of Iran) may
be on the brink of change. Leaders
and citizens of the western world
have high hopes that a seemingly
oppressive regime will come to an
end after a so-called democratic
election was declared 63% in favor of
the acting president after only several
hours and major cities erupted in riots.
Many Iranians have cried out to the
international community for help,
bypassing the state-controlled media
and broadcasting over the almighty
Internet, as the country seems ready,
willing and able to regain its former
excellence. Despite the best efforts of
its current leader(s) to suppress such
ambitions for nearly 30 years – change
may be around the corner. Alongside
its astounding 5000-year culture, more
than 40 million citizens under the ago
of 30; and the world’s second largest
oil and gas reserves at its disposal,
Iran could surely re-emerge to reclaim
its place as one of the world’s great
nations.
Rick Waker and Tim Geyser are
sitting at lunch as Rick says to Tim:
“Tim, I’ve got some serious problems
with my company. A long chain of
wrong decisions has left me deep in
the red, I even had to give up my jet!
Do you have an idea what I could
do?!”. Tim reaches down into his
briefcase and says “Here, take this
book, the holy bible. It has helped
me plenty of times when I needed
guidance. Just flip it open randomly
and whatever you read on that page
you simply do”. Rick is sceptical
but takes the advice without
commenting.
Three months later Rick and Tim
meet again for lunch; as Rick enters
the restaurant, Tim can’t help but
notice the upbeat mood that Rick
is in and says: “Wow Rick, you look
awfully happy – have things turned
around for you?” Rick replies “Yeah
Tim, I did what you said. I went
home that night and flipped it open
and read the page. After that, all my
problems simply disappeared!”. Tim
says: “You see, I told you it would
work! What did you read on the
page”. Rick replies: “Well my friend,
I opened the book and the first thing
I read was Chapter 11.”
“eleven”
words: justine doody
With billions of
Dollars sitting on
the sidelines, what
is going to bring
investors back to the
table?
In this economy, all investors have
become more wary about where they put
their money. There are plenty of good
deals still out there, but in an investment
climate that has sent so many onto the
rocks, it’s only natural that more people
than usual are hesitant when it comes
to getting in the water. But while a
little fear is a sensible response for any
investor, there comes a moment when
being reluctant to pull the trigger means
passing up a good opportunity. So what’s
keeping investors timid, and how can it
be overcome?
Investors in a difficult climate become
more risk-averse than they would be
at other times, making them tend to
stick with what they know – which is a
sensible position, so long as it doesn’t
militate against taking any chances at
all. One way to leverage the familiar for
many investors is to put their capital only
into companies where they have personal
knowledge of the management team or
entrepreneurs involved. Investing only
within a network of contacts can help
weed out bad deals, but not all good
deals will come from within a closed
circle. So, many investors make sure to
look as closely at management teams as
at the opportunities they’re presenting. If
the management team has considerable
experience in the relevant industry, and
has met with success in its area in the
past, investor jitters are more likely to
be overcome. If, on the other hand, the
entrepreneur has recently been involved
in a startup failure, or lost their job at
a larger company, fairly or unfairly,
investors may feel that it doesn’t bode
well for the chances of success this time
round. Moreover, investors want to feel
that the people they’re sponsoring are
fully committed to the business they
run. Making sure new business owners
aren’t drawing down a massive salary
in the early stages of their project can
help reassure investors that the business
comes first.
Having faith in the people behind the
opportunity can go a long way towards
quieting investor doubts. Another way
for investors to boost confidence that’s
taken a hit due to the downturn can
be for them to get together and share
the risks. Investor groups, whether
informal networks or formally organised
institutions, enable investors to harness
the wisdom of the crowd in assessing
opportunities, as well as to pool
resources, enabling them to diversify
investment across several projects
instead of putting all their eggs in one
basket. And further, just seeing that
others in the group are willing to take the
risk can help to shake off any lingering
doubts about pulling the trigger.
Good people can be reassuring, and a
supportive environment can help steady
the nerves, but at the end of the day, an
investor needs to see potential in the
project before she will make the deal –
and that means thinking others will see
potential in the deal as well. Aside from
supplying a product or service that solves
a problem or fills a niche, investors more
than ever want to see projects with a
clear, well thought out exit strategy.
Since the likelihood of IPOs as an exit
strategy is reduced, investors in startups
are focusing on mergers and acquisitions
as the best way of seeing returns. So, a
project with several potential acquirers
in its market may stand a good chance of
attracting the investment it needs.
The hard times will end, and those
investors who are feeling insecure at the
moment will grow daring again. But in the
meantime, investors and entrepreneurs
need to do their homework before
anyone pulls the trigger – right now,
neither has the luxury of target practice.
pulling the trigger
why investors are scared

the getaway
of getaways
If you are looking for a place to just kick back for the weekend and to forget the rest
of the world - we think we may have found it for you.
words: G. paTRICK GRUHN
My wife and I wanted to get away
for a quiet weekend to recharge our
batteries so I went on a quest to find a
hotel in Switzerland that offers absolute
luxury. Pretty soon it became evident
that the only choice for this little getaway
had to be the Dolder Grand Hotel in
Zurich. The Dolder has a long tradition
of excellence, going back as far as 1899.
It recently re-opened its doors to its élite
clientèle after an extensive renovation
period of four years. As I toured the hotel
with the public relations manager, Mrs.
Vanessa Flack, it became evident why
it had taken them so long – the Dolder
had been transformed into an oasis of
well-being; the famous architects, Foster
& Partners, turned this very traditional
and monumental landmark into a luxury
city resort. Sitting on the hills of Zurich,
overlooking the lake’s busy shores as well
as the Alps, the hotel offers a serene
environment of forest walkways whilst, at
the same time, it is just minutes from the
city where you’ll find everything from the
best shops to metropolitan entertainment.
The rooms are spacious, decorated
with the finest materials and opulent
furniture in a contemporary design,
featuring the highest standard of modern
day technology (for example every room
offers free wireless internet access, as well
as clever Bang & Olufsen entertainment
units which allow you to control almost
all of the room’s luxuries with the touch of
a universal remote). After soaking up the
view from your private terrace, the hotel
has an award winning Spa which stretches
over 4000 square metres and includes
countless pampering extravagances which
will rejuvenate you from head to toe. The
Spa was designed by the internationally
renowned wellness specialist Ms. Sylvia
Sepielli and is open to indulge you 7 days
a week from 7am to 10pm. In September
2008, it received the Tatler Award for “the
smartest escape”. A temple of relaxation,
where only the best is good enough,
with all the amenities and delights that
anyone, even the most demanding client,
could ask for.
Culinary excitement is provided by
the German cook Heiko Nieder who
will serve you up some miraculous treats
for your taste buds in “The Restaurant”,
which has been awarded a Michelin star,
as well as 17 Gault Millau points.
Each of the Dolder
Grand’s four luxury
Top Suites is an expres-
sion of individual
extravagance. Harmo-
nious interior designs,
each different from
the other, create an
exclusive ambience in
all four suites. For
more information
thedoldergrand.com
The quality service and attention to
detail in this newly re-opened resort is
nothing short of excellent and it makes
for the perfect weekend getaway, to clear
your head and to soak up the finest,
luxurious pleasures.
InApril, the Dolder Grand was on the
2009 hotlist of Condé Nast Travelor (UK)
as one of the world’s best new hotels.
Rayan Partners LLC was founded as a VIP service company in
spring 2005 to cater to the world’s most exigent clients. In the
past three years we have grown to become Switzerland’s big-
gest network of elite service providers. Today, we humbly offer
you the services of over 20 partners, each one of them with the
highest standards of excellence and quality.
Компания Rayan Partners была основана весной 2005
с целью предоставить услуги класса «де люкс» самым
требовательным и элитным клиентам со всего мира.
За последние три года наша компания выросла и стала
самой крупной в Швейцарии сетью элитных поставщиков
в сфере услуг. На сегодняшний день, мы предлагаем Вам
сеть, в которую входит более чем 20 партнеров, каждый
из которых предоставляет услуги, соответсвующие самым
высоким стандартам качества.
Rayan Partners a été fondée au printemps 2005 avec comme
objectif de satisfaire la demande en matière de service VIP en
Suisse et à l’étranger. Durant ces 3 dernières années, nous
avons pu construire le plus grand réseau de prestataires de
services de luxe (avec plus de 20 partenaires). Nous sommes
ainsi à même de vous fournir tout type de services par le biais
de notre réseau et de nos connaissances.
Switzerland’s Number 1 VIP Advisor
www.rayanpartners.com
www.switzerlandclinics.com
www.switzerland-boarding-school.com
www.switzerland-college.com
General Enquiries
Mrs. Natacha Liechti
+41 79 208 55 09

I feel as if I’ve just emerged from the
Stone Age; like a blind man who finally
sees the light... I feel like I’ve been
looking for answers for the longest time
but firstly I was looking in the wrong
place and secondly I was shying away
from change, which is what most people
tend to do I suppose. For the past years
I’ve been going from one PC to the next,
looking for better performance and more
user friendly applications and more
cognitive.As I pursued my quest, the PCs
kept getting more and more expensive
and nothing really seemed to make a
difference. No matter how expensive and
how “advanced” the PC laptops became,
they were
always fairly
slow and none
of them every
really exceeded
a battery life
of two to three
hours… Did
mac
attack
you ever watch a DVD on your laptop
on the plane and right before the end
the battery went out on you? How
many of you have to defragment your
hard drives ever so often to get a bit
better speed out of your machine?
How many of you have loaded your
PC with spam ware, firewalls, anti-
viruses and what not, slowing you
down considerably? Well, all of that
could change…
A few weeks ago I decided to jump
into the seemingly ice cold water
and to make inquiries about Apple…
I spoke to some friends who were
using them, raving about their user
friendliness for years. For example, I
asked one of them: “Which anti-virus
do you use?” and he replied “common
sense!” and so I said “aaah, so what
is it? Commonsense.com?” he just
laughed and explained that Mac
doesn’t get viruses – ever. That was
it for me; I went to the Apple store
(I must admit I was there at least a
dozen times, circling my prey like a
predator before the kill) then I finally
made my move. I bought the Macbook
Pro 17” and that was the beginning
of my transition from PC to Mac. A
bit creepy at first, thinking that I’d
have to start all over; learn to use an
unfamiliar system from the ground up.
Well, surprise surprise to all of those
out there who still think that PC is
the paramount, the apex of mankind’s
technological achievement. The Mac
attack has begun in many places and I
bluntly assume that as more and more
people get the ever so hot and popular
iPhone, those same people will get
very curious about Apple computers.
Because truth be told, the iPhone is
like a miniature Mac and if you like
the usability of the iPhone then any
Mac computer will please you greatly.
My last PC was an Alienware,
custom built high performance PC
with excellent components and cool
design. Well, once again, even those
state of the art PCs have nothing on
the Mac, especially not when it comes
to the design. Just to give you an idea
of the performance, the battery of
the Macbook lasts up to eight hours,
which is four times as much as the
average PC laptop – but you’re doing
the very same things if not more. It
took me about half an hour to get the
hang of the basics, and another three
to four hours to get familiar with the
system. Sure there are many little
tricks that the avid user knows and
I don’t but those tricks make things
even faster and I’m already using the
machine to my full satisfaction at my
total capacity so what more do I want!
I can personally recommend the
transition to Mac based on personal
experience. Everything makes sense,
works better and faster – what more
can one want? In my opinion, the
Mac should be everyone’s favourite
companion (if you don’t have a dog).
words:g.patrickgruhn
Man discovered weapons and
invented hunting.
Woman discovered hunting and
invented furs.
Man discovered colors and
invented painting.
Woman discovered painting and
invented make-up.
Man discovered speech and
invented conversation.
Woman discovered conversation
and invented gossip.
Man discovered agriculture and
invented food.
Woman discovered food and
invented the diet.
Man discovered woman and
invented sex.
Woman discovered sex and
invented the headache.
Man discovered trade and
invented money.
Woman discovered money and
man has never recovered.
On June 25th 2009,
Michael Jackson the
King of Pop, died of
cardiac arrest in Los
Angeles at the age of
only 50. Economically
speaking, beyond
the world of music,
some companies may be
at a great loss as Jacko was
scheduled to perform 50 concerts
over the course of the next 9 months, all
of which were already sold out. Jackson
leaves behind an astonishing musical
legacy that will most likely make his heirs
hundreds of millions of Dollars over the
coming years.
historicdiscoveries
‘58-’09MICHAEL
JACKSON
MONTREUX - GENEVA - LONDON
ANTWERP - CHICAGO
web: www.hept-media.ch
email: info@hept-media.ch
c r e a t i n g v a l u e i n p u b l i s h i n g
With the global downturn cooling
investors’ appetites for traditional
investments like stocks and
property, many are looking at
alternative places to put their
money. Tangible assets like wine
are attracting a lot of interest –
and not just to drown investors’
sorrows!
Traditionally, fine wine does
well in difficult times, dropping
in value more slowly than other
investments and recovering
faster. In the current recession,
the first indicator has held
true – Liv-ex, the index of the
world’s top 100 investable wines,
weathered the first half of 2008
well, rising by 9.5% before stalling
in the summer. The end of
2008 and the turmoil it brought
to the global economy saw a
correction, the first in a decade,
where the index fell by 25%. But
the beginning of 2009 brought
stability, and by the end of June
2009, the index was up 4.5% for
the year. In April, the index rose
by 2.8%, its largest increase since
June 2007. Wine professionals
believe that the market is looking
up, and should rise fast in the
coming half year – and some
commentators think that picking
up a few bottles might, for once,
be the sober thing to do.
wine as
an asset

The “Golden Jubilee” at 545.67 carats, closely
followed by “The Cullinan” at 530.20 carats. Both
stones were discovered in the same mine near
Pretoria (South Africa).
The “Eclipse” at 167.1 meters or 548 feet and 22 inches.
It is owned by Roman Abramovich the 42 year old
Russian billionaire. His yacht is closely followed by the
“Dubai” at 162 meters, owned by Sheik Mohammed bin
Rashid Al Maktoum.
...longestmotoryacht
...most expensive hotel
...largestuncut
diamondever
found
the Grand Resort Lagonissi in Athens, Greece. The “Royal
Villa” is rented out at USD 50’000.- per night and comes
with a private butler, chef and even a pianist. (We reported
about the Grand Resort in a previous issue). The second
most expensive is the “Hugh Hefner Sky Villa” at the Palms
Casino Resort in Las Vegas at USD 40’000.- a night.
The “Henry Graves
Supercomplication” by
Patek Philippe, made
in 1932 and sold at
Sotheby’s for over USD
11’000’000.- at an
auction in 1999. The
second most expensive
watch is also a Patek,
from 1989, sold for over
USD 5’000’000.- at
auction in 2004.
...mostexpensive
watcheversold
Still in use is actually the British Pound. It is also the third largest reserve
currency (after the Dollar and the Euro). It is traced back to King Offa of Mercia
(757 – 796 A.D.). The pound got its name from the actual weight. At the time of
introduction, 240 sterling silver pennies weighed one pound.
...most
ancient
currency
the world’s...
Carried out by a Boeing 777-200LR, the aircraft flew 22
hours and 40 minutes from Hong Kong to London, covering a
distance of 21’600 kilometers. Today, the longest commercial
flight is Newark to Singapore, a distance of 16’600 kilometers
and takes 18 hours and 40 minutes.
The Bugatti Veyron at EUR 1’200’000.- which happens
to also be the fastest production car in the world; closely
followed by the Lamborghini Reventon which is sold at
EUR 1’150’000.-.
...mostexpensivecar
...longestcommercialflight
...most
expensive
big mac
...biggest
truffle
We did a little research to find out a few fun facts that
will make you more interesting at your next dinner party
words: David Johansson
A 1787 Chateau Lafite, sold for a whopping EUR 115’000.- per
bottle at Christie’s auction house. That is a steep price to pay for
something that doesn’t even serve it’s original purpose.
...mostexpensivewine bottle
Is sold in Norway and
costs USD 5.79; the
most affordable Big Mac
is sold in Malaysia for
USD 1.70 that is more
than three times the price
in difference! As a matter
of fact, the Big Mac is
used as a measure of
purchasing power parity.
Weighed 1.51kg and made its
way into the Guinness book of
records. Not surprisingly it was
the most expensive truffle ever
sold at EUR 125’000.-. That is
one expensive mushroom!

D E A L SD E A L S
Our team of experts provides access to the
best solutions in private equity,
asset management and VIP advisory.
MONTREUX - GENEVA - LONDON - ANTWERP - CHICAGO
web: www.hept.ch email: hept@hept.ch
B e c a u s e t h e r e i s s o m u c h m o r e t o l i f e
INTRODUCTIONINTRODUCTION
Perla group
A new turnkey provider in the Middle
East, focusing on efficiency and quality
for an elite clientele. From satellite
communication, aviation to armoured
cars or even K-9 services, Perla has
developed solutions for a number of
market needs and is now aspiring to be
the first taxi-jet provider in the region.
Player24Seven
Poker is a business that has been
discovered only recently by serious
entrepreneurs around the world.
Whether you call it gambling or sports,
it is a big business. The latest addition
to the league of market participants is
Player24Seven.com, a company that will
attempt to harness the immense market
potential generated by soccer fan clubs
into one players platform.
Winch Energy
A new and ambitious Italian energy
company, Winch Energy is focusing on
photovoltaics. With a management that
brings 25 years of experience to the
table, the company aims to develop a
portfolio of 300-400 MW solar PV and
create enterprise value of at least €500
million in the coming three years.
Volna Watches
Always on the lookout for new ideas,
we found Volna Watches. The company
combines Swiss luxury watch making
tradition with Russian nostalgia and
icons. The result is an interesting blend
of precision craftsmanship and design,
reminiscent of cold war submarines.
Does Volna have what it takes to succeed
in this market?
HouseTrip
While travelling, be it for business or
leisure, one doesn’t always feel like
staying in a hotel. If that is the case,
HouseTrip has the solution. This team
of young hospitality entrepreneurs is
developing a portal that’ll allow you to
find a home away from home. Learn
more about this new interface in the
short term private property rental market.

D E A L SD E A L S
D E A L SD E A L S
International
PerlaGroup
The Middle East offers opportunities
for serious profit, but doing business
there comes with its own set of
challenges. Dubai-based company
Perla Group International Ltd. (www.
perlagrp.com) established itself as a
successful turnkey solutions provider by
helping others address the obstacles of
long distances, weak infrastructure and
difficult political climates – all of which
can add significant costs to bottom lines.
Now, the company plans to leverage its
success in telecoms, armoured cars and
K-9 services to launch the first low cost
corporate taxi-jet service in the Middle
East.
To get Perla Aviation off the ground,
the company is seeking to raise US$4.9
million, by offering 4.9 million Ordinary
Shares for sale, representing 49% of
the total shares in the company. The
controlling interest will remain in the
hands of company founder and CEO
Charles D’Alberto. The majority of the
The Middle East is an interesting
marketplace for luxury goods and
services. What does it take to be
successful in the region?
PerlaGroup
International

D E A L SD E A L S
D E A L SD E A L S
capital raised will go on the purchase of
two Mustang Citation Corporate Jets,
which will be acquired with a 60% down
payment of approximately US$3 million,
the remainder being financed directly
by Cessna Finance. Perla expects that
the aircraft will be wholly owned by
twhe company within 24 months. The
rest of the funds raised will be used
to support the aviation operation as
well as going towards working capital
needs throughout the company’s other
divisions, Perla Telecoms Group, Perla
K-9 Services and Perla Armored Cars.
From its base in Dubai, at the centre
of the GCC States of Bahrain, Kuwait,
Oman, Qatar, Saudi Arabia and the
United Arab Emirates, Perla Aviation
will be able to ferry business people to
emerging markets in Africa as well as
Middle Eastern states like Afghanistan
in flight-times of just an hour or
two. Alternatives in the region to the
transport service Perla Aviation proposes
are few, a fact that the company hopes to
capitalise on. Low cost operators are still
unable to offer routes across many of the
markets that Perla Aviation will serve.
Current prices for chartering planes
in the region, according to Perla CEO
Charles D’Alberto, are at the lowest
US$5,000 per hour, with a typical rate
hovering around US$6-8,000 per hour.
PerlaAviation will be able to significantly
undercut the competition. By operating
aircraft with low overheads and low
maintenance costs, Perla Aviation will
be able to offer rates on its corporate
taxi-jet service of US$3,000 per hour.
The model, according to D’Alberto’s
research, has proved successful in
Europe and the US, where low cost
travel options are much more widely
available – so he is confident that uptake
in the Middle East and Africa, where
communications infrastructure still lags
behind the West, will be strong.
Perla Aviation has already begun
operating. To supplement the activities
of Perla Group International’s other
divisions, Perla Telecoms Group, Perla
K-9 Services and Perla Armored Cars,
the Aviation division has delivered cargo
for clients to several areas of the Middle
East and Africa. And the company’s
strength in other areas will continue to
be key to the success of the aviation
venture. Perla Group International
counts among its clients global entities
like US private military contractor and
aircraft maintenance company Dyncorp,
as well as engineering company Bechtel,
and even the United Nations, all
operating in hard-to-access areas across
the region, such as Somalia, Kenya,
Pakistan and Iraq. Perla Aviation can
leverage the group’s existing client
base to provide a ready-made source
of customers for the corporate taxi-jet
service. New clients will be attracted
through a range of marketing strategies;
as well as employing on-the-ground
sales liaison officers to reach out to new
clients doing business in Dubai, the
company plans to promote its services
heavily on the Internet, and its booking
procedures will be fully automated and
accessible online.
D’Alberto’s track record in business
is strong: at Australian company
NewSat, he recognised the potential of
VSAT technology for the Middle East,
and helped make NewSat the fastest-
growing VSAT company in the world.
As CEO and founder of UAE-based
DigitalSkys Ltd., he built the company
from initial seed funding of US$250,000
to a market capitalisation of US$40
million. He was the first to bring auto-
deploy satellite technology to the Middle
East, and followed it up by pioneering
the use of GSM over IP in the region.
PerlaGroupInternationalgrewoutofhis
expertise in telecoms – the first division
to start operations was Perla Telecoms
Group, which in 2007 began providing
turnkey solutions to SMEs, large telcos,
military customers and other clients
needing specialised communications
products and facilities. Expanding on
the success of the telecoms division,
and in order to meet the needs of its
customer base more fully, the company
evolved into providing armoured cars,
aviation solutions and K-9 services.
Himself a qualified helicopter pilot,
D’Alberto has enlisted the expertise of
key industry figures and experienced
pilots to help build the aviation segment
of the business.
Dubai has been hit harder than
most by the global downturn; its once-
booming property market has slumped,
taking a good deal of the emirate’s energy
with it. But D’Alberto views the current
dip as an opportunity for Perla’s new
venture: as companies try to cut costs,
the lower rates PerlaAviation can charge
should appeal to clients who need to
do business in the region. Moreover,
D’Alberto says, Dubai’s location makes
it the ideal springboard for doing
business in the region. And as Western
companies who were quick to enter
the market in better times now hustle
for the exit, Perla has the advantage of
remaining on the ground – as D’Alberto
puts it, “To do business here, you have
to be based here.” Combining Western
corporate governance and standards
with regional expertise and a strong local
base, the company is well positioned
to take advantage of the niche it has
identified.
D’Alberto contends that investors
will see an immediate return on
investment. Pointing to the fact that the
group’s other divisions are profitable,
he projects that the company will
continue strong growth, and sees this
share issue as the final capital-raising
exercise before the company goes
public. The eventual goal for Perla
Group International is to list initially
on the Australian Securities Exchange
(ASX), followed by a dual listing on the
Dubai International Financial Exchange
(DIFX).D’Albertoexplainsthereasoning
behind the two-pronged strategy, which
he calls “going out and coming back
in”. Besides the advantages that will
accrue to the company from listing on
the ASX, listing in Australia will enable
the company to bypass the lengthy
process of listing on the DIFX, through
a mechanism that enables companies
publicly traded on the ASX to list on the
DIFX following a period of as little as 60
days from application. This dual listing
will allow the company to benefit from
the corporate governance standards
of the ASX as well as to tap into the
considerable appetite for investment
and substantial available capital offered
by the Dubai exchange. And having
one foot in each market parallels the
company’s vision for success – putting
together the best of the West with the
new opportunities of the Middle East,
the company hopes that for its new
venture, the sky’s the limit.
Top: Ultra light jet as
Perla aims to put into
use rather sooner
than later to cater
to its elite clientele.
“CombiningWesterncorporategovernanceandstandardswithregionalexpertiseandastrong
localbase,thecompanyiswellpositionedtotakeadvantageofthenicheithasidentified”

For ten years we have offered our clients tailor-made
solutions in all areas of Wealth Management.
We would be pleased to speak with you about your
individual wishes and objectives.
FINANCIAL SERVICES
www.jasso.ch
Sternmattstrasse 12B
CH-6000 Luzern 4
Phone: +41 41 368 50 77
Fax: +41 41 368 50 79
JASSOJASSO
FINANCIAL SERVICES
JASSO
FINANCIAL SERVICES
JASSOJASSOJASSO

D E A L SD E A L S
D E A L SD E A L S
Gambling is a big business
and Player24Seven.com
has interesting strategies to
capture market share where
others failed.
words: madeline thomas
spend per visit and multiple revisits. It is all
based around the badge-wearing mentality
of the sports fan. This, he suggests, does
not limit the gaming opportunities to
single-sport events. Research conducted
by Player24Seven showed that 87% of
respondents would be open to playing poker
tournaments against rival supporters and
94% would like to play poker on a site that
offered the opportunity to win tickets, go to
events and meet idols.
Fans’ site visit times could be boosted
by streaming sports news, videos, league
statistics etc – all tools Player24Seven
intends to implement, particularly as 78%
of respondents to its survey said they would
play on a sports gaming site “over other sites
available today”.
Of primary concern to investors and
Player24Seven alike, is the resilience of the
gaming industry in the face of recession. So
far, the biggest rivals in the business have
demonstrated growth in tough economic
conditions.
Playtech’s end of year results for 2008
showed revenues rose 86% to $104m on the
year with casino revenues up 58% and poker
revenues 269% higher at £27.4m, leading to
PBT of $70m.
888.com’s end of year results for 2008
showed operating income grew 21% to
$262.5m, PBT rose 6% to $48.6m.
Sporting Bet’s year end results showed
the company posted a £7.7m increase in
half-year operating profits to £11.7m.
Yes, these are leading companies and,
for all their success, there will be other
gaming firms struggling with a lack of
consumer loyalty and excessive marketing
costs at the bottom of the heap. However,
Pearson’s understanding of the industry,
its vagaries and vulnerabilities will insulate
Player24Seven to a reasonable extent.
This can be demonstrated in the
decisions made by the firm to date.
The gaming license will be held in the
jurisdiction of Malta. As eCOGRA pointed
out, the firm will be able to operate across
its European markets from Maltese base
at a fraction of the cost of a UK one. It
is a common decision taken by gaming
companies.
Player24Seven will not develop its
own back-end software. Instead it will
white label the software of Canada-
based PokerNetwork, which also provides
solutionstotheworld’slargestonlinebetting
gaming group,AIM-listed Sportingbet. This
cost of this will come in two parts: a set-
up fee plus and ongoing running cost,
typically between 17% and 20% of the
“rake” (the revenue). There is a long-
term revenue bleed in this approach
but there is also the security in knowing
that PokerNetwork has been working
with the Interactive Gaming Council
for around a decade and has a great
deal of experience is counteracting
electronic play infiltration and other
fraud issues.
The unofficial fan-based approach
may e considerably cheaper than
attracting curious punters through shirt
deals or celebrity endorsements but
it is not free. Indeed the plan is that
fan clubs will be remunerated with a
revenue share for each fan referral that is
between 20% and 40% of the rake over
the life of the player’s spend on the site.
Underfunded fan groups therefore have
an incentive to plug the Player24Seven
site over rivals and the site itself does not
have to stomach upfront ad spend; it can
be funded directly from revenue.
The industry may still be in its
infancy but there are significant profits
to be had for the player with the correct
approach to market. Online poker room
rates are currently worth around $5.7
billion a year and are expected to top
$12 billion a year by 2012.
Player24Seven is poised to come
to market but for two issues: the cost
of getting back-end software up and
running and the cost of the license.
These two will cost just over £200,000;
marketing spend – although significantly
lower than rivals - is still projected to
cost £300,000 and legal costs associated
with the licensing and start-up along
with associate office costs will cost
around £100,000. This, combined
with staff costs, means the company
is looking for an initial investment of
£1 million to allow it to make the final
step to come to market. It proposes to
release an equity stake in return for the
investment.
That funding would be sufficient
to see the firm through the first six
months, after which it would need a
further £3 million to bankroll it through
to profitability. Assuming the company
projections stack up and the funding
falls into place, Player24Seven would
be looking to reach breakeven by
month 15 and turn cashflow positive in
month 16.
successfully pulled together sponsorship
deals and top-draw tournaments for other
gaming firms and represented star players
worldwide, it would be discourteous not to
sit up and take notice.
This is the story behind the ready-to-
launch business, Player24Seven and its
CEO, Stephen Pearson.
Pearson has a long track record in
puling deals together and, more importantly,
in understanding who will comprise
Player24Seven’s loyal customer base and
how to attract and retain them for a fraction
of the cost his rivals employ.
Most online gamers are men aged
between 18 and 34 who are committed
sports fans. That is why companies such as
888.com have spent fortunes securing high
profile football sponsorship deals.
Pearson is CEO of Sports Media
Gaming – a company founded in 2005 –
that has rapidly become a leading agency in
sports, media rights and gaming industries.
Indeed, the nugget of his idea came from an
SMG client: goalpoker.com
Goalpoker.com started and finished
in 2005, its demise brought about by lack
of funding. Pearson, who was the first ever
commercial director of the FA Premier
League as well as the marketing director
for the UEFA Champions League knows
his target audience. Furthermore, he was
the one, essentially shaping the industry by
marketing poker as a sport as opposed to
leisure gambling. Armed with substantial
experience, a gambling license in Malta as
well as manpower (Peter Moore of Center
Parks, a chairman of excellent pedigree),
Pearson attempts to capitalize on the merger
between sports and poker.
The question investors will be keen to
see answered is why would Pearson and
Player24Seven succeed where others have
failed?
With more than 15 years in international
sports marketing, Pearson both understands
the demographic he is working to attract
and understands how expensive sporting
failure can be. He intends to keep marketing
spend to a minimum by eschewing high
profile shirt sponsorship deals (think 888.
com or Mansion.com), touchline bill board
advertising (goalpoker.com) or celebrity
endorsement (Boris Becker and PokerStars)
in favour of tapping into the unofficial fan
clubs through fan forums, fanzines and
supporters clubs worldwide.
A natural born marketer, he has ideas
aplenty to generate brand loyalty, clicks and
goodbet
Spottinga
The online gaming industry is
still in its infancy and has huge growth
potential. In part that is be cause – as a
young industry – there are still punters to
attract. More significantly, it is because
many countries are only now granting
online gaming licenses (such as France
and Italy) or considering changing their
stance on online gaming (such as the
United States).
The pattern for emerging industries
is reasonably standard: entrepreneurs
spot a new opportunity; new entrants
flood the market to try and take
advantage of being first at the feeding
frenzy; the market begins to mature,
customer volumes stop growing at
exponential rates but brand loyalty
becomes more determined; businesses
fail or consolidate or position themselves
to take advantage of a distinct customer
subset within the new industry; the
market stabilises.
Despite being an emerging industry,
it is not quite the free-for-all consumers
might fear. Firms are licensed and, as
partofthatprocedure,mustdemonstrate
certain funding requirements. Despite
that there is a glut of entrants in the
market. In the UK alone eCOGRA
(the industry standard’s authority) has
approved 7 mobile sites, 28 online poker
rooms, 90 online casinos, 4 bingo halls,
6 sports books and 5 group sites.
Given these volumes one would
understand a degree of reticence when a
new player stands in the wings awaiting
the capital to come to market. Yet, when
the brains behind that operation has

•
Historic
hishistoricandlavishestatefeaturesa
variety of attributes which, in Switzerland,
are hard to come by as opportunities are
scarce.
The castle offers a magnificent view over
Lake Geneva and the Alps. It’s private
park is landscaped in fine detail, featuring
fountains with a private water source,
beautiful walkways as well as an outdoor
swimming pool.
This 18th century jewel is built in such
a way that it can be used as a highly
representative, private residence as well
as an office, for example as a prestigious
company headquarter. It’s proximity to
main business hotspots such as Geneva
(only a few minutes by helicopter or 30
minutes by car) as well as its absolute
privacy make it second to none.
The castle is classified as a historic
monument, built of 16’000sqm of land, the
construction volume of the castle amounts
to nearly 4’000 cubic meters.
Sale price upon request, please contact
thierry.martin@pbbg.ch or call +41 21
345 36 38.
T
SwissCastle
Château de Mézery

D E A L SD E A L S
D E A L SD E A L S
Getting power from the sun is
an idea that has been around for a
long time, but as the world begins
to wake up to the joint crises of
climate change and the final end of
fossil fuels, new emphasis is being
put on developing renewable energy
sources. Winch Energy thinks that
it can harness the power of the sun
to create a reliable energy source
for Europe – as well as a glowing
business opportunity.
Europe is ahead of the game
when it comes to solar energy:
more than 80% of new worldwide
photovoltaic (PV) capacity installed
in 2008 was in Europe, according
to market research company
iSuppli. But there’s plenty of room
winch
for expansion – according to the
European Photovoltaic Association,
by the end of 2008 Europe had an
installed solar energy PV capacity of
9,251 MWp, and it is estimated that
the end of 2013 will see the continent
with an installed capacity of 45,863
MWp. Moreover, the EU is pushing
for greater utilisation of renewable
energy sources. In December 2008,
the EU confirmed its commitment
to have one fifth of its energy come
from renewable sources by 2020.
Solar energy is expected to provide
the largest part of that, accounting
for 15% of EU energy by 2020.
Focussing on photovoltaics and
concentrated solar power, Winch
Energy plans to develop a portfolio
of 300-400 MW solar PV over three
years, and to create an enterprise
value of at least €500 million within
three years. The company sees its
greatest opportunities in Italy and
France, where the Mediterranean
sun generates plenty of usable
power, and where solar energy has
had limited uptake up to this point
as compared to neighbours Germany
and Spain. Later, Winch plans
to expand to Bulgaria, Portugal,
Spain, Greece, Turkey, Tunisia and
Morocco.
Winch Energy is developing solar
energy projects adding up to over 400
MWp in Italy and more than 100
MWp in France. Its Italian projects
are getting underway – in the third
quarter of 2009, construction is set
to begin on the 37.31 MWp Scilla
Project in Calabria and on the 18
MWp Foggia project in Puglia. The
fourth quarter will see construction
start on five further projects, and
the first quarter of 2010 will see
the company’s first operations open
at Foggia. By the end of 2010, the
company will have operations at
12 different projects throughout
Calabria, Puglia and Sicily, as well
as construction ongoing at some
smaller projects, accounting for a
total of 243.27 MWp.
On its Scilla project, the company
cites a total project cost of €194
million, with project equity of €29.1
million and project debt of $164.9
million. The financial life of the
project is 20 years, with an assumed
operating life of more than 25 years;
the company estimates IRR over 20
years at 10.42% post tax.
The company emphasises the
expertise of its management team:
between them, the members have
more than 25 years developing
renewable energy. Winch Energy has
relationships with technical partners
including BP Solar, Solar Reserve
and Solar Integrated.
After the economic downturn,
lack of financing is slowing down
some solar energy projects. But the
European Photovoltaic Association
points out that government support
programmes offer investor security
in the long term – in Winch’s focus
countries, these take the form of
Feed-In Tariffs over 15-25 years. And
since the downturn has reduced the
cost of necessary materials for PV
plants by as much as 20% since the
start of 2009, the sun might still be
shining on the investment potential
of solar energy projects.
Fossil fuel’s are likely to run
out at some point in the
future but the sun
appears to be an
infinite resource...
Focussing on photovoltaics and
concentrated solar power, Winch Energy
plans to develop a portfolio of 300-400 MW solar PV
over three years, and to create an enterprise
value of at least €500 million
energy

D E A L SD E A L S
D E A L SD E A L S
Introducing an all new online platform that allows travellers to stay
in a home away from home rather than an impersonal hotel.
With more and more people going
online to find accommodation
for holidays and business trips,
finding a hotel online has become
commonplace. But while many
websites exist to help customers
easily and quickly negotiate the
range of options available in the hotel
segment, the fast growing industry
of short-term private property rental
has few such portals. New hospitality
website HouseTrip’s goal is to become
the leading marketplace for short-
term accommodation rentals.
According to consultancy
PhocusWright, the short-term rentals
industry accounts for 10% of the
travel industry, and vacation rentals
company HomeAway has valued the
short-term rentals segment at US$63
billion, almost half as much as the
hotels industry. And yet in 2007,
just 12% of short-term rentals were
booked online, as compared to more
than half of hotel visits. HouseTrip
thinks its model will provide a new
way of doing business in the industry,
beating the competition at the same
time as attracting new customers into
the short-term rental online space.
The HouseTrip model allows
anyone with a place to rent to list
their property on the website. Up
to now, the most common outlet for
vacation rentals online has been the
classified listing site, charging a flat
fee to property owners for a fixed term
ad. But unlike listing sites, HouseTrip
will allow users to list their property
for free – HouseTrip’s cut will come
from charging a commission of 5-10%
on rentals. Like established hotel
booking sites and unlike the usual
listing sites, HouseTrip will offer
direct booking facilities, so that users
can complete the whole transaction
within the HouseTrip platform. The
company will also enable property
owners to auction certain sought-
after dates in their accommodation,
for instance at times of major sporting
events.
HouseTrip hopes to leverage the
new opportunities offered by Web 2.0
to build a website that will be the first
stop for those 50 million individuals
every year who consider an online
vacation rental. Each property will
have a profile page, like those used
on social network sites such as
Facebook; potential renters will be
able to examine their hosts’ profiles
to get a sense of the property and of
the opinions of previous tenants. The
site will use familiar social networking
features like ‘groups’ to allow users to
rent within a closed community, for
instance, the alumni of a particular
university.
But HouseTrip founder Arnaud
Bertrand points out that the company
is not trying to muscle its way into the
already crowded social network space:
“We have a social interface
because we think it is important that
hosts see who stays at their property
and guests see at whose property
they stay at. We do not want to be yet
another social network, so we try to
benefit from existing social networks.”
Bertrand intends the company to
develop widgets for use with existing
networks like Facebook and LinkedIn,
playing off users’ existing online
identities to create an instant comfort
level with the HouseTrip platform and
to facilitate easy sharing of information
between potential guests and property
owners.
HouseTrip will launch at the end
of July 2009 with 5,000 listings, and
hopes to expand to 8,000 listings by
the end of the year. By the end of
its first year of operations, it expects
to have over 10,000 listings, and by
the end of its second, it should have
more than 22,000. The company has
already met its first round investment
objectives, around €217,375, and is
now seeking its second round. It hopes
to attract €2 million in this round of
investment.
On the left: view of
the housetrip online
interface where
members can view
houses and rent them
directly via the site. v
According to consultancyPhocusWright,
the short-term rentals industry accounts
for 10% of the travel industry
Don’ttake
ahotel,takea
housetrip..

D E A L SD E A L S
D E A L SD E A L S
UnitingSwissmanufacturewithRussian
iconography, young luxury watch company
Volna Watches launched the latest addition
to its range in March 2009. The Typhoon
Siberia, a titanium sports watch, exemplifies
the brand identity built up by Volna since its
inception in 2007, linking new materials with
classic design themes to create a prestige
product that the company hopes will capture
the imagination of consumers.
Founder and CEO Francois Candolfi gained
his experience of the watch industry at
luxury watch company Audemars Piguet
and the Swatch Group’s luxury brand Léon
Hatot. Together with partners Eleonore
Paschoud and Marc Calmonte, Candolfi
has reconstructed an iconic brand – Volna
means ‘wave’ in Russian, and the company’s
watches are based on those worn by divers of
the Soviet submarine fleet. The new iteration
of the brand creates divers’ watches too,
but replaces Russian manufacturing
with Swiss fabrication, capitalising on
the prestige and reputation of Swiss-
made watches. The company’s hopes
for success rest on the combination
of nostalgia and novelty represented
by the Soviet theme, backed with the
trustworthiness of Swiss technical
competence.
Candolfi’sten-yearvisionforthecompany
hinges on three factors – maintaining a
high-quality, original product, creating
a distinctive image and keeping up the
historical continuity of the brand. Each
line of watches maintains the nautical
theme with names like Typhoon, a nod
to the submarine class of the same
name, and design elements like oversized
dimensions and high water resistance.
Volna shipped its first watches in March
2007, to the United States, Singapore,
Asia, Europe and the Middle East. The
Typhoon range retails at 4,900 CHF to
7,250 CHF; Volna has had some success
in arranging distribution for the range,
signing up as its US distributor PK
Time Group, a company dedicated to
introducing European watches to high-
end American consumers.
The luxury watch industry
sees its latest addition
with Volna, a brand that
unites Russian nostalgy
with Swiss expertise.
VOLNA
Swiss manufacturers dominate the luxury
watch industry, taking almost 100% share
of the market. The Swiss watch industry
has been hit hard by the economic
downturn, and 2009 is predicted to be
one of the worst years for the industry
since the 1970s –exports declined 24.3%
in the first four months of the year alone.
But if the industry follows the expected
trend for luxury goods overall, it should
stabilise in the second two quarters
of the year: consultants Bain and Co.
expect sales of watches to fall by 12% in
2009 as a whole. Watchmakers feel that
the industry is sufficiently buoyant to
ride out the recession without too much
concern – between 2003 and 2008,
Swiss watch exports rose by 67%, and
the total value of Swiss watch exports
grew to €11.25 billion in 2008, up €728
million on the previous year. The growth
of demand for luxury goods in emerging
markets like China and India may be
the key to bringing the market out of its
slump, as traditional US buyers scale
back. Industry analysts believe that the
market will reach 2008’s highs again
in two to three years – so if Volna can
wait out current conditions, it may see
an uptick in the market’s fortunes before
too long.
Above: different views of the Volna
design; the rotor of a submarine as one
of their key design elements.
“the combination of nostalgia and novelty
represented by the Soviet theme, backed with the
trustworthiness of Swiss technical competence”
watches

w e a lt h m a n a g e m e n tW E a lth m a n a ge m e n t
jasso.chjasso.ch jasso.ch page 37jasso.ch
spo n so r e d b y jasso
We are, hopefully, in the end game
of a global economic recession. The
definition of a depression is not always
agreed on but is, broadly, “A period of
sustained recession in one or more
national economies.”, The root cause
of the economic predicament that
we all now face is down to a financial
crisis caused by questionable, some
say reckless, lending practices on
mortgages in the US just when
commodities rocketed in price, leading
to a boom in asset prices. What goes
up must come down and it has.
Like it or not, market regulation
is coming and the markets will have
to adopt and adapt to what may,
eventually, become a globally co-
operative regulated market. In the
world’s largest economy, the US,
President Obama is attempting to
push through five basic points of
change. The first is to increase the
power of the Federal Reserve, allowing
it to be able to rein back the big
financial institutions, scrap the thrift
charter (two of the largest sub-prime
lenders were thrift charter banks)
and force them to become federally
regulated commercial banks or state
banks and also to require institutions
to hold more capital. The second point
is to police the securitisation and
derivatives markets. The third point
is to establish a consumer protection
agency. The fourth point and, perhaps,
alarming for some companies, would
be to allow the US to wind down and/
or seize the assets of globally inter-
connected firms. Finally, President
Obama wants to increase international
co-ordination and, hopefully, do away
with an organisation’s ability to shop
for the best regulations under which
to operate. It’s entirely possible that
not all of these changes will take place
in their entirety.
Change is afoot in the European
Union (EU) too. The EU plans to
create a European Systemic Risk
Board (ESRB) to monitor and assess
threats to the financial stability of
the economy. The ESRB will have
the power to issue risk warnings and
recommendations for action said
Market regulation: Innovationkillerorsafeguard?
the EU Council in its Presidency
Conclusions bulletin. The EU council
has also put forward that a European
System of Financial Supervisors
be established that would have
supervisory power over credit rating
agencies. In a statement, the council
said, “The financial crisis has clearly
demonstrated the need to improve
the regulation and supervision of
financial institutions, both in Europe
and globally. Addressing the failures
exposed by the present crisis will
contribute to preventing future crises.
It will also help restore confidence in
the financial system, in particular, by
enhancing the protection of depositors
and consumers and will thus facilitate
the recovery of the European
economy.”
The US and EU are the
world’s biggest economic players.
Nonetheless, the wind of change is
How much regulation
can the markets
take before the over-
protectionism drives
away participants?
For the last twenty years the Fund
of Funds (FoF) model encompassing
mutual funds, hedge funds, private
equity funds and investment trust
funds have ruled the roost. Today,
following the unmitigated disaster of
2008, FoFs are starting to pick up the
pieces in an uncertain market and
an uncertain regulatory environment
going forward. Will FoFs ever be the
same again? And, is that really a bad
thing? Given some of their activities
leading up to the global recession,
probably not. One of the highlights
of bad behaviour is Bernard Madoff’s
US$50bn fraud of investors. This
probably never would have happened
if FoFs were more regulated, less
complicated and more transparent.
The current call for international
regulations and registration to
make the industry toe the line,
remains strong. The Madrid based
International Organization of
Securities Commissions (IOSCO)
said that financial regulators should
be able to demand information from
FoFs and be able to share data of
“globally active” funds and fund
managers. “The crisis has given
regulators the opportunity to consider
thesystemicrolehedgefundsmayplay
and the way in which we deal with the
regulatory risks they may pose to the
oversight of markets and protection of
investors,” said Kathleen Casey, a US
Securities and Exchange Commission
member and chairwoman of
IOSCO’s main working body, the
13-country Technical Committee.
The international will is there, it is
highly likely that, given the time, a
way will be found and FoFs will have
to comply.
The activities of many FoFs
during the last few years became
a returns numbers game, often
leading to opaque and very short-
term investments which can be
volatile. Investors’ money was lost
in the recession and confidence has
been badly dented. A recent survey
Fund ofFunds
by Reuters seems to show that
companies are turning away from
hedge funds. The trends were noted
from part of a Pan-European survey
of 261,000 votes from 1,450 buy-side,
170 brokerages and 500 of Europe’s
largest quoted companies. The survey
said that no companies avoid hedge
funds in 2009 but only 29 per cent
of the survey rated hedge funds, as
informed investors, compared to 39
per cent in 2008 and 46 per cent in
2007. The poll for the importance of
hedgefundsforcompaniesisrevealing
too, “The decline in importance from
43 per cent in the 2007 Survey to 16
per cent this year is striking,” said
Steve Kelly, global head of surveys at
Thomson Reuters Extel.
The survey also showed that
companies are looking for capital
closer to their home markets and
that over 90 per cent of equity asset
managers regard direct company
meetings to be paramount.
Nonetheless, some money is
certainly flowing again. Felix Chee,
one of the advisers to China’s
US$200bn sovereign wealth fund and
is initially running China Investment
Corp., said in an interview at the
GAIM International hedge fund
conference in Monaco that they
will be looking to make investments
in hedge funds, “We will have a
preference for managed accounts, it’ll
be across the spectrum of strategies,”
he said. “We’re looking for the best
managers and a handful of fund of
funds and, when I say a handful, I
mean five or less.”
The ability of FoFs to hold a,
hopefully, well managed diversified
portfolio remains attractive and,
although the FoF has taken a severe
hit, it is unlikely that the concept
will disappear from the investment
scene. Good funds run by consistently
performing managers and will ride the
recession out and emerge the other
side. Regulation may be unpopular
with FoFs but is, frankly, inevitable.
Who’s on top
these days, bull
or bear? Are we
steaming ahead
with the herd
or going into
hibernation;
It’s summer so
hibernation is out.
Or is it?
blowing over other major economies
such as Canada, China, Russia and the
UK too. There is a real fear that market
innovation will become the victim of
bureaucracy and some fund managers
are nervous. In a recent study of
asset fund managers, 70 per cent
expected the future of the industry to
be dominated by large players, while
only 17 per cent expected the sector
to become more vibrant, with a closer
association between asset managers
and their clients. However, the market
has been largely left alone in the past
and the result has been horrendous.
To those that have walked the edge of
regulation for years it is clear that they
must change their strategies pretty
quickly. Over the long term, investors
should be safer if, perhaps, largely
unable to go for the larger, riskier
returns. A bird in the hand is worth
two in the bush, isn’t it?
On the horns of the
bulls or in the claws
of the bears?
Are we in a bear market or a bull mar-
ket? The answer to that is probably nei-
ther and both. Confidence and gloom are
infectious. Too much of either in today’s
stock markets can surge prices up or
down propelled more by sentiment and
hunches than for good hard reasons.
June 22, 2009’s savage correction has
been attributed to the World Bank’s dec-
laration that the world economy would
decline 1.2 per cent more than the 1.7 per
cent forecast for 2009. The confidence
that we are out of the woods factor was
too much and the market snapped back.
However, the trend should be slowly
upwards and within that period there
will be some mini bear and bull trends.
The year of 2009 is, short of a miracle,
effectively shot, in terms of results and
national economies. Some companies do
well in a recession. However, the major-
ity will not. Therefore, analysts have
pinned their hopes on 2010. Earnings,
however, are largely still falling. Com-
ments in the media have said that many
equity analysts are pushing the earnings
expectations too high and the word,
“lemmings,” was used. The reputation
of analysts is also somewhat tarred
given their recent track record leading
up to and during the current recession.
So perhaps these predictions should be
taken with, “a pinch of salt.”
If consumers and companies aren’t
buying then we can’t expect to see a
surge in demand for commodities and a
growth in company results and with that
higher stock valuations can reasonably
follow. On a positive note, respected
organisations the world over are now
predicting modest if uncertain growth
beginning in 2010. The key word here
is, “uncertainty”, the word is like a cross
to a vampire for stock market traders
and investors. To, perhaps, “expect the
unexpected,” is the key message here
given the economic events of the last
couple of years. Well-managed and
well-structured companies will emerge
strong, as will some start-ups. But, bear
in mind (no pun intended) that any kind
of growth will see the start of an upward
cycle again but always, in the early days,
with the danger of a stock market bear
waiting to rip your economic face off.
The bull is, apart from rare forays, prob-
ably firmly penned for the time being.

CurrenciesWhereisyourmoneysafer?
Which country has
the best policies,
limiting inflation and
promoting growth?
That’s the million
Dollar question...
In these days of day-to-day
volatility, currency trading is not
for the faint hearted. Money can
be made or lost on the up and
down swings of a single day. If
you’re looking for a cast iron safe
investment, currency trading may not
be for you. Nonetheless, if you have
an amount of risk capital on which
you’re prepared to take a hit or lose
altogether then there are possibilities
to make some money. Currency
trading is all about knowing when
to get in and when to get out which
means a lot of research and second-
guessing events and trends.
On Wednesday, June 24 the
US Federal Reserve, as expected,
kept its benchmark rate unchanged
at 0.25 per cent. The statement
accompanying the announcement
was more bullish than the market
expected so the following day the
US dollar rallied. In the short-term
however, the dollar is expected to be
under some pressure, with the long-
term trend still bullish. The Federal
Reserve said, “Although economic
Please give us a brief
background about yourself and
Capricorn Asset Management.
I was a proprietary trader for
Smith Barney working from the
Geneva office when I decided
to go on my own and form Capricorn.
I know I was not the first ‘ex-prop
trader’ with a well performing strategy
wanting to start his own hedge fund,
but I knew that I needed to find
someone to ‘seed’ the fund. As it
happened, the prop desk also serviced
a number of the banks’ HNW clients,
which I had developed quite a close
relationship with. It was two of these
clients that offered to back me if I did
go on my own, so I suppose you can
say that they prompted me to form
Capricorn.
Things have evolved a lot since 1999,
both in terms of Capricorn as a
business as well as the fx market as
a whole. I started out as a one man
operation and ran the business like
that for 2 years. I however realized
that doing the trading, marketing,
administration and many other things
was too much and focus was not
there to do every job 100%, therefore
the organization gradually has grown
since then. Today we are a team of
4, myself as CIO, Mike Rasmussen,
Partner and COO, Martin Zoller,
Compliance & Klaus Oesterballe,
Global head of sales.
We run 3 trading strategies covering
different time frames, as well as
an external multi manager strategy
which was launched in cooperation
with a US fund which is already a
activity is likely to remain weak for
a time, the Committee continues
to anticipate that policy actions
to stabilise financial markets and
institutions, fiscal and monetary
stimulus and market forces will
contribute to a gradual resumption
of sustainable economic growth in a
context of price stability.”
The UK pound hit a 12 day high
on June 24 almost hitting US$1.66.
However, current market expectation
is that that bubble will burst
especially when the Bank of England
governor, Mervyn King, said, “I
feel more uncertain now than ever.
This is a pattern of recession that
we’ve not seen since the 1930s.”. He
followed on by saying that economic
recovery could still be a, “long, hard
slog.” Early trading on June 25 at
the US$1.63 mark would seem to
confirm this sentiment. However,
smart buying before the 12 day high
would have netted a profit.
The Euro has been described
recently as choppy and the Japanese
Yen is expected to be under some
The current
economy;
on the up,
going down
or bumping
along the
bottom?
Lately, there have been signs
and portents that the global
economy may have reached a
point where the situation is not
going to get much worse but,
conversely, is not expected to
climb off the bottom anytime
soon. The recent rise in confi-
dence got a severe hammering
when the World Bank revealed
that it thought that the world
economy would decline by 2.9
per cent in 2009 instead of 1.7
per cent as previously forecast.
The Bank said that 2010 may
see some growth but that it
was uncertain and that those
who could least bare the pain,
developing countries, would see
more to come. The International
Monetary Fund (IMF) is upbeat
however, predicting modest
growth mainly for 2010. “Finan-
cial conditions have improved,
confidence is recovering gradu-
ally and indicators of future
production and demand have
firmed,” said IMF first deputy
managing director, John Lipsky,
at a conference in Turkey.
The Organization for
Economic Cooperation and
Development (OECD) recently
released its twice yearly report,
in which it estimated that the
US recession will bottom out
in 2009 with a 2.8 per cent
contraction but should grow 0.9
per cent in 2010. The OECD did
note however, that the decline
in the US housing market ap-
peared to be coming to an end,
citing a reduction in the supply
of unsold homes relative to
demand. The news isn’t that
good from Canada, as reported
bank lending for May shrank 3.5
per cent, the third consecutive
monthly drop in the commodity
rich nation, suggesting that for
the short term the recession will
continue.
In Asia, speaking at an execu-
tive meeting of the State Council
in China, Chinese premier Wen
Jiabao said that the economy
was at a crucial point as a
steady recovery has begun. He
tempered his words saying that
there were still uncertainties
for a stable economic recovery
such as weak exports, the fiscal
deficit and trade protectionism.
In Japan, there are encourag-
ing signs as the nation logged
a fourth straight monthly trade
surplus for May of US$3.2bn
beating expectations by around
37 per cent.
Reading between the lines,
it’s pretty clear that we are not
out of the woods yet but, hope-
fully, the recession won’t get any
worse. Getting back to where
world economies were before
this all started however, is likely
to be a long, slow haul.
bearish pressure. Other notable
currency movers to look out for,
given recent movement, are the
Australian dollar, the Canadian
dollar, the New Zealand dollar and
the Swedish Krona. Will investing in
any of these currencies be absolutely
safe? Absolutely not. Could your
investment net a profit? Absolutely
possibly.
Mikkel
Thorup
Making
Moneyin
Forex
client of ours. Our combined asset
under management are currently just
under 300 million USD across the
strategies in managed account and
fund formats, and our clients include
corporate treasuries, fund of funds,
family offices and HNW individuals.
Do you see increasing
investment opportunities in the
currency markets despite the
current turmoil in other markets and
why do you believe currency
management should be part of an
investment portfolio?
I believe there will always be
investment opportunities in
trading currencies, mainly
because of the inherent inefficiencies
of the marketplace. As long as these
inefficiencies continue, in my opinion
a skilled trader should be able to
generate risk-adjusted returns over
time regardless of the situation in
other markets. For this reason I
believe that every investment portfolio
should have an ‘active currency’
component seeking additional
returns. Empirical evidence has
suggested a low correlation between
currency strategies and other asset
classes, and this simply strengthens
the argument for currency
management for me. However in my
judgment, increasing investment
opportunities in the currency market
will only prevail by introducing
unique strategies and ideas. The
marketplace is vast and deep enough
for skilled managers to develop alpha
seeking strategies that truly add value,
while the ‘copycat’ funds are unlikely
to gain any traction.
Currency investments are gaining
momentum and popularity with
investors as a source of uncorrelated
returns. With markets in a general
slide and funds losing billions in
capital, new ways to achieve better
portfolio diversification is at the
top of the agenda for institutional
investors. Currency as an asset class
provides low correlation to traditional
investments and even to alternative
investments (making them almost
the alternative to alternatives). The
last two years have also strengthened
the need of investors for highly liquid
investments and the right risk tools
in place in times of distress. Only a
few managers were able to still deliver
their performance, with all three of
the above-mentioned needs in mind.
What are the benefits of
currency as an asset class ?
Liquid market: High liquidity is
one of the primary advantages,
an area in which currencies are
unrivalled. This market is extremely
liquid. Turnover is over three trillion a
day, according to the triennial BIS
survey 2007, and recent surveys by
central banks indicate higher totals
for the 2010 survey. Transaction costs
are, I would say, on average 20 times
more advantageous than equity,
maybe even more. It’s the most cost-
efficient capital market in the world.
This high liquidity allows for much
shorter redemption periods, and also
means that Capricorn does not
Photo of Mikkel
Thorup, forex
strategist and
founder of Capricorn
Asset Management

impose any lock-ups on clients.
Free leverage: The instruments used
for our investment strategies gives our
fund access to free leverage. However,
this doesn’t mean that the team is
overly aggressive when it comes to
gearing. “You can get leverage of up
to about 20 times for free, “but in our
case we use only a maximum of two.
We are very conservative on leverage.
Our performance has been better
than most hedge funds and at the
same time our leverage has been well
below the other hedge funds.
Low correlation: A good currency
strategy can prove to be extremely
useful in generating alpha, as
correlationisverylowtothetraditional
asset classes used by institutional
investors. That’s why we see more and
more pension funds actually looking
at currency as an asset class. We
have provided asset-liability studies
to several of our investors, adding our
portfolio to their existing portfolio,
and you see very positive portfolio
effects. And the interesting point in
our case is that the correlation with
other alternatives is also low. So even
within your hedge fund portfolio, you
can create diversification by adding
currencies as an asset class.
Can you elaborate on the
currency programs Capricorn
currently offers and how have
you tailored your investment vehicles
to assist investors to participate in
your strategies?
The first program that I
developed was the Short-term
strategy that was launched in
January 1999. This is our flagship
program in terms of the long track
record and annualized returns. The
program is currently available only as
a managed account as it is the
preferred investment vehicle of our
clients. Institutional investors such as
Fund-of-Funds, Banks and Corporate
Treasuries approve the transparency
and the ability to notionally fund the
investment. The strategy has a very
low margin-to-equity ratio and
therefore the managed account format
is extremely cash efficient. The
Medium-term strategy was launched
in February 2007, utilizing a long-
options strategy to capitalize on the
broader intra-month market moves.
Capricorn
management at work;
six screens, charts
and a head full of
ideas to get returns
for investors.
This program is available to investors
as a managed account only. Our most
recent strategy is our Long-term
program, Capricorn fxG10 that was
first introduced April 2008, developed
as a ‘carry trade’ strategy with a
specialized arbitrage component to
reduce risk. This strategy is only
available as a fund as we target clients
seeking an investment opportunity
they can passively managed because it
is administered and audited
professionally.
Achieving risk-adjusted returns
consistently is never easy. What
key attributes do you think
successful currency managers need to
have?
I am definitely an advocate of
the ‘Turtle’ philosophy to
successful trading; having
confidence, consistency and
discipline. So even though I
technically analyze market
opportunities daily, our trade
frequency is comparatively low due
to our discretionary view and
methodology. A clearly defined
methodology with a robust risk
control policy is crucial for a currency
manager to be successful in the long
term. Creating a unique strategy
that is able to achieve risk-adjusted
returns is half the battle, being able
to maintain your discipline during all
market conditions and follow your
rules to trading is the other half. My
personal view is that the ability to be
selective over the identified ‘alpha’
seeking opportunities is more
important than following what the
charts indicate. I have seen too
many occasions when even
professional managers have given
back their profits and more by over-
trading.
You have been nominated as
“best newcomer” for the
European Performance Award.
What’s your secret? Tell us about the
strategy.
The Capricorn FX G10 fund’s
strategy is categorized by
Capricorn as long-term,
fundamental seeking alpha
opportunities in most market
conditions by benefiting from
currency arbitrage and exchange rate
discrepancies. The program seeks
risk-adjusted returns that are
uncorrelated to other investment
strategies by trading the most liquid
assets available to investors, the major
currencies. The strategy uses
currency forwards and has a
directional bias in the carry trade,
borrowing low-yielding and lending
high-yielding currencies. Risk is
controlledthroughadynamichedging
strategy aimed at reducing exchange
rate risk. Performance tends to be
strong in all market conditions,
providing ample liquidity is available.
When we launched the Capricorn
FXG10 fund, we had already
established ourselves as a foreign
exchange manager over the past 10
years so I did not want to stray into
another asset class. In early 2008 I
thought it wise to launch the strategy
because of the diverse changes and
inefficiencies in the currency markets
at the time. The differentiating
factor behind this program is the
fundamental approach of the
strategy; where as the other programs
that we run are technically orientated
in analysis. The Capricorn FXG10
fund uses a systematic approach to
trading with a longer-term view. We
also checked that our clients would
like the offering and it turned out that
a small Swiss family office wanted to
seed the fund, as they believed in the
approach.
In order to provide a source of
uncorrelated alpha to professional
investors, Capricorn believes our
niche, as a currency manager is the
discipline inherent within its trading
methodology. The routine for the
strategy is initiated with the analysis
of interest rate discrepancies, as well
as the global macro fundamentals of
the major currencies.
After the fundamental view is
determined on the G10 crosses,
leverage is re-balanced on a portfolio
level depending upon the monthly
cash adjustments within the fund.
The individual currency crosses
are then entered into the in-house
carry model, used to optimize the
allocations of the components
within the portfolio. This builds a
portfolio that is balanced in currency
weighting, in order to reduce the
exchange rate risk of the components
and to isolate the carry benefits of
the strategy. Execution is automated
across multiple liquidity providers to
access the arbitrage opportunities
created by the risk control measures.
The recent foreign exchange
environment has not been the best
type of environment for this strategy
because it has seen interest rates
coming down. When this happens,
carry trades do not get very exciting
and there is not much interest rate
arbitrage around. Nevertheless, I
attribute the recent success of the
fund to hedging off much of the
fund’s exposure in long carry trades,
and being able to time entries and
exits efficiently.
Through this we have been able to
maintain constant performance. If
we look at the first year track record,
wehaveonlyhavethreedownmonths.
The main reason for our success I
think is discipline. You definitely
need discipline in trading and in
decision-making and we have 10
years of experience in discretionary
and technical traders. Discipline and
risk management are the key drivers
of our achievement.
“You definitely need
discipline in trading and
in decision-making and
we have ten years of
experience. ”

Charles D'Alberto Elevator13 - www.perlagrp.com

Charles D'Alberto Elevator13 - www.perlagrp.com

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