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Savinvest India Asia Fund goes open-ended

Dear unit holders,

I would like to take this opportunity to express our appreciation to all investors who participated in the Savinvest India Asia Fund (SIAF) over the years. We at Bourse have been the Manager of the Fund since its inception. As most of you will be aware, on July 25th 2012, 99.5 per cent of the SIAF investors voted in favour of a conversion of the fund from a closed ended mutual fund to an open ended mutual fund. This conversion was completed on November 11th, 2012. Starting today, the Fund is no longer listed on the Trinidad and Tobago Stock Exchange (TTSE) and investors can now purchase and redeem units held in the Fund on any business day. Investors will receive US$ upon such redemptions.

The Fund's Performance

Year to Date (YTD) we have had a commendable performance with the Fund soaring to 14.96 per cent as at 8th November, 2012, and the Net Asset Value (NAV) closing at USD9.49 (TTD 60.85) buoyed by an influx of positive data. YTD, our Fund is the best performing local mutual fund and has outperformed every Asian based fund with the next big player recording returns of 8.96 per cent (see Exhibit 1). The Fund has benefited from the higher concentration in the Indian equity space.

In the first two years of operations, the Fund gained strong returns; however, the 2008 financial crisis eroded these early returns. After the Fund recovered in 2009/2010, we faced the 2011 Eurozone crisis which brought about increased volatility. The Asian markets like all equity markets, could not escape the ripple effects of these two major international events. Though we have encountered some significant challenges along our path, as can be seen from the YTD 2012 returns, the Fund has been pushing upwards. Since inception the Fund has a produced a return of 5.25 per cent (inclusive of distributions).

It is important for me to remind you that despite the 2008 and 2011 performance; Indian equities have performed commendably compared to its developed world counterparts reflected by its general outperformance of the US equities over the past 8 years. India's BSE Sensex Index generated average returns of 23.7 per cent compared to the US S&P 500 Index which averaged 3.6 per cent for the period 2005 to 2012 YTD.

Outlook

I am confident that the fund will continue on an upward trajectory. We, like many other international analysts hold a bullish view for the Asian markets.

Our rationale is that the economic growth of developing Asian countries is expected to be 6.7 per cent and 7.2 per cent in 2012 and 2013 respectively. The growth rate for India is expected to be 4.9 per cent in 2012 and 6.0 per cent in 2013. These figures are far better than the expected growth rates of 1.3 per cent in 2012 and 1.5 per cent in 2013 for advanced economies. This view is consistent with IMF estimates that going forward, growth is projected to pick up and Asia should remain the global growth leader.

India's government recently introduced initiatives to revive economic growth and avoid a credit-rating downgrade, which so far have been able to stimulate growth. The Rupee (India's currency) is expected to remain at 53 Rs per US$ towards the end of the year and appreciate to 49 Rs per US$ in 2014 as reflected by Bloomberg analysts' mean projection.

Foreign Institutional Investors (FIIs) continue to remain positive in the Indian market as evidenced by the inflows of portfolio investments in the amount of USD 18 billion over the last twelve months. This would constitute the highest foreign inflows in India over the past two years. The average FII inflow into India over the past 5 years is USD 10.6 billion.

We share the view of Bloomberg analysts of a bullish outlook for the Asian market, and forecast that the earnings of Indian companies will pick up in 2013. India's forward valuation of 13.18 times appears relatively cheap when compared to its 5 year historical P/E average of 17.21 (see Exhibit 2). The outlook is for Indian equities to increase from current prices which will be beneficial to our Fund.

Benefits to You

Now that the SIAF is an open ended fund, there is much more flexibility to you, the Unit holder in terms of accessing your Units and receiving US$ payment upon redemption as opposed to the closed end approach. You can now purchase or redeem Units in US dollars daily and you now have increased liquidity resulting from the ability to redeem units daily.

Acquiring Units

In the open ended Fund there is a greater ease for entering and exiting the fund when compared to buying shares on the TTSE. Investors who wish to purchase Units in the Fund can come to any one of our three offices on any business day and acquire Units.

The price of the units will depend at the Net Asset Value (NAV) which will be calculated on that day. When the SIAF was listed on the TTSE, the listed price was not representative of the NAV but was a reflection of the market forces of demand and supply. Now investors will be able to buy into the Fund at a price that is reflective of the value of the Fund.

I continue to recommend that investors to take advantage of the opportunities in the Asian space by investing in the SIAF.

Yours Sincerely,

Subhas Ramkhelawan

Managing Director

Bourse

—This report is for informational purposes only and does not constitute an offer or solicitation to buy or sell any mutual funds or securities discussed herein. The information and any data contained herein have been obtained from financial data provided to us by the issuers of the subject mutual funds or securities. Investors wishing to purchase any of the mutual funds or securities mentioned should consult an investment advisor. Projections and estimates are those of Bourse Securities based on current available information. E-Mail us at askus@boursefinancial.com or phone 628-9100/ 628-6204.

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