August 2008 Factsheet

    RNS Number : 0566E
  Bramdean Alternatives Limited
  23 September 2008
   
     RNS Announcement 
    23 September 2008

    Factsheet August 2008

    Bramdean Alternatives Limited

    This Factsheet contains commentary and news for the calendar month ending 29th August 2008, unless otherwise stated. 

    August Estimated Net Asset Values

    Sterling shares:          102.22 pence 
    U.S. Dollar shares:      US$ 0.9742


    Overview
    Bramdean Alternatives Limited, (the "Company") is a Guernsey-based Investment Company listed on the London Stock Exchange. The Company
invests in a diversified portfolio of private equity funds, hedge funds and other specialty funds.


 KEY FACTS

 Market Capitalisation           £113.6 million

 Manager                         Bramdean Asset Management LLP

 Annual Management Fee           1.5%

 Performance fee                 10% subject to an 8% return and a high watermark

 Company Brokers                 Cenkos Securities Plc

 Sterling class share price on   78.50p
 29th August 2008  

 Sterling class issue price      100.00p
 (9th July 2007)  

 Number of Sterling shares in    97,751,842
 issue  

 U.S. Dollar class share price   US$ 1.02
 on 29th August 2008  

 U.S. Dollar class issue price   US$ 1.00
 (9th July 2007)  

 Number of U.S. Dollar shares    65,988,142
 in issue  

 Minimum investment              N/A

 Dealing                         Daily

 Valuation                       Monthly

 NAV publication                 Monthly

 August Sterling Estimated NAV   102.22 pence
 per share  

 August U.S. Dollar Estimated    US$ 0.9742
 NAV per share  

 Total common assets             US$ 253,630,412

 Total Estimated Net Asset       US$ 246,535,725
 Value  

 Half-year end                   30th September 2008

 Financial year end              31st March 2009

 Company Secretary and           Royal Bank of Canada Offshore Fund Managers Limited
 Administrator     

 Registrar                       Capita Registrars (Guernsey) Limited

 Stock Exchange code (Sterling   BRAL
 shares)  

 Stock Exchange code (US Dollar  BRAU
 shares)  

 Sedol code (Sterling shares)    B1XCHB9

 Sedol code (US Dollar shares)   B1XCLF1

 ISIN code (Sterling shares)     GG00B1XCHB94

 ISIN code (US Dollar shares)    GG00B1XCLF11




    AUGUST MARKET COMMENTARY

    Three events dominated the financial headlines during August: the upward march of the U.S. Dollar; Russia's invasion of Georgia and
oil's retreat from its all-time high of $147.27 per barrel.

    The month opened to a continued slide of the oil price and gold touching a six-week low-point below $900 per troy ounce. Both the
Federal Reserve and the Bank of England left interest rates on hold at 2% and 5% respectively. In the UK, the Halifax house price index
reported an 11% fall in house prices in the year to July 2008 and UK inflation figures for July indicated that inflation remains on course
to reach 5% by the autumn. 

    By the middle of August, the oil price was back where it was in April having done a round-trip from $114 per barrel to $147 per barrel.
In that time, the MSCI World Index of stocks had fallen by over 11%. Concern that further turbulence lay ahead was reflected in the
three-month LIBOR rate which was priced at 81 basis points over the Fed Funds rate. This compared with the average spread of 12 basis points
over the Fed Funds rates that prevailed before the onset of the credit squeeze last year. 

    Uncertainty about the stability of the U.S. mortgage financiers, Freddie Mac and Fannie Mae, took hold mid-month as Freddie Mac paid 113
basis points over U.S. Treasuries to raise $3 billion of five-year debt; Fannie Mae paid a record 122.5 basis points over U.S. Treasuries
for its debt raising. As investors became concerned that the equities rally lacked conviction, the U.S Dollar, which had closed July at $/£
1.98, reached a seven-month high of $/£ 1.87 and oil rebounded back over US$120 per barrel. 

    The crisis in Georgia ratcheted up as President Dmitry Medvedev recognised the independence of South Ossetia and Abkhazia, two
Russian-controlled breakaway regions of Georgia. International investors' confidence in Russia waned resulting in an 18.2% fall in the
Russian RTS stock market index since the beginning of the month and a collapse in the volume of debt raised by Russian companies and in the
volume of equity issuance. 

    By the end of August, the U.S. Dollar had appreciated by over 8% against Sterling to $1.82 and by over 6% against the Euro to $/EUR
1.47. Stock markets held steady over the month with small increases of 1.22% in the S&P 500 index, 1.24% in the FTSE Eurofirst 300 Index,
4.15% in the FTSE-100 Index and 1.6% in the MSCI World Index. The U.S. benchmark West Texas Intermediate oil closed the month at US$115.46
per barrel, the European benchmark Brent crude at US$114.05 per barrel and Gold at US$834.60 per troy ounce. 



    PORTFOLIO NEWS

    General

    The underlying unaudited performance in August was +2.82% for the Sterling share class and
    -0.96% for the U.S. Dollar share class. This compares to falls of 1.4% and 1.5% for the HFRI Fund of Funds Composite Index and Credit
Suisse/Tremont Hedge Fund Index. 

    The discrepancy in performance between the two Share classes was caused by the exceptional strength of the U.S. Dollar which appreciated
by 8.6% during August. The Company's policy is to hedge currency exposure. During August,  70% of the Sterling Share class U.S. Dollar and
Euro exposure was hedged, whilst 70% of the U.S. Dollar Share class Euro and Sterling exposure was hedged. While the Sterling share class
incurred a loss on its U.S. Dollar hedge, this was offset by the 30% exposure to the U.S. Dollar that remained un-hedged and by the
appreciation in the value of the U.S. Dollar-denominated underlying assets.  

    There are 37 holdings in the Company's overall portfolio. During the month, the investment manager acquired a holding in Evergreen MAC
Limited, a managed futures fund that follows systematic long-term trends. This fund has been added to the Strategic Hedge Fund portfolio. 

    The stand-out performer during August was Kei Limited, a managed futures trader that follows systematic short-term trends. Good
performance was also returned by Rye Select Broad Market XL Portfolio Limited, York European Unit Trust, Arkaad plc and Defender Limited. 

    Overall, the Company's hedge fund investments experienced mixed fortunes during the month with Atticus European, Enso Global Equities
Fund Limited and Evergreen MAC Limited struggling in particular. The remainder of the Company's hedge funds showed encouraging resilience
and comfortably out-performed the hedge fund indices during the month. 

    We have previously reported the changes we are proposing to make to the Company's Transitional portfolio to reduce the exposure to
market volatility. We have identified ten new funds from our shortlist which we are likely to subscribe to from October, with one new
subscription likely to be made by the end of September. Our focus will be on generating absolute returns and we have been focussing our
selection on volatility funds, commodity trading funds, global macro funds and asset-backed lending funds where there is a high
loan-to-value.

    The Company continues to hold cash, which amounted to 4.3% of the portfolio at 29 August 2008. 





    Private Equity and Specialty


    The Company has now made commitments to seventeen underlying private equity funds and underlying specialty funds amounting to
approximately $230 million. One new commitment of US$5 million was made during August to Limetree Emerging Beachfront Land Investment Fund
II L.P. This fund invests in beachfront land with development potential with a focus on the Asia Pacific region, and in particular on
Thailand and Cambodia. The fund expects to hold its investments for between three and seven years, with a view to selling the land on to
groups such as hotel or condominium developers. The fund does not develop the land itself. 

    The total amount that has been drawn-down on the commitments made is approximately 
    US$68 million, with approximately US$4.9 million of capital having been drawn-down in August. The Company received one distribution
during August from Greenpark International Investors III L.P. and has now received total distributions of US$2.0 million since inception.

    Capital calls were received from seven of the underlying funds while two funds reported upwards fair market revaluations. The private
equity and specialty portfolios are performing as expected, with much of the portfolio going through the J-curve currently and so
experiencing the initial losses that are typically incurred as private equity firms begin improving their portfolio companies. The
secondaries private equity funds are providing support for the portfolio, continuing with distributions as expected to balance against the
capital calls for other funds. Some of the 2006 investments are coming to a stage where they are starting to consider exit options and
pricing. The distressed debt managers to which the Company committed late last year and earlier this year have started investing into
certain quality distressed situations during the current quarter, as the investment manager had anticipated. These commitments are expected
to draw heavily over the next two years to take advantage of the prime opportunity for distressed assets and are expected to generate good returns as a result.


    Transitional Portfolio

    The portfolio continued to hold eight funds at 29 August having submitted redemption notices to five of those managers. It returned
-0.7%, including cash, during August and has returned an unaudited -2.5%, including cash, in the calendar year-to-date compared with -6.4%
year-to-date return for the HFRI Fund of Funds Composite Index and -3.6% for the Credit Suisse/Tremont Hedge Fund Index. Since inception,
the portfolio has returned -1.2%. 
        
    The portfolio's holdings in York European Unit Trust and Arkaad plc were strong performers. Overall resilient performance in the
portfolio was impacted by poor performance from Enso Global Equities Fund and weakness from York Asian Unit Trust during the month.

    Our Transitional portfolio is designed to manage the cash that the Company commits to private equity and specialty funds but has yet to
be drawn-down. The Company may seek to implement portfolio protection through the use of derivatives from time to time for some portion of
the Transitional portfolio, though the Company has not used derivatives for this purpose to date.

    The Transitional portfolio was set up with three aspirations; to reflect private equity-type characteristics and returns, to preserve
capital over the medium-term and to be as liquid as possible so that the Company can meet its capital calls. Initially, to achieve these
aims the portfolio was largely invested in a series of specialist global equity managers, long/short equity and event-driven managers as
these classes demonstrate the most similar characteristics to private equity. The portfolio also aimed to reduce exposure to market risk
through market neutral and relative value funds. 

    In response to the continuing market turbulence, Bramdean has been reducing the emphasis on achieving private equity-type returns and
increasing the focus on capital preservation. 


    Strategic Hedge Funds Portfolio

    The portfolio posted a small loss as August saw a continuation of the themes that broke in July, with markets once again experiencing
sector rotation and selling pressure. The portfolio held 13 funds at 29 August. It returned -0.8% during August and has returned an
unaudited +5.3% in the calendar year-to-date. Since inception, the portfolio has returned an unaudited +15.2%. One new fund has been added
to the portfolio in the month: Evergreen MAC Limited is a managed futures strategy that follows systematic long-term trends. 

    Portfolio Highlights

    Equity Hedged
    The style posted a loss as sector rotation within equity markets continued. Our European manager's underperformance was related to
stock-specific events, losing from a rise in two of the UK retail/house building short positions, while benefiting from longs in the
European post office and logistic companies. While our dedicated short seller posted large losses from single stock short in the volatile
equity environment, these were limited by positive contribution from cash holdings. 

    Event Driven
    The style posted a loss, mostly attributable to one manager penalised for its large exposure to metals and mining stocks, with top names
such as Xstrata and Freeport McMoran falling over 10%. Our distressed manager performed ahead of expectations given the credit environment,
profiting from idiosyncratic situations focused around non-distressed positions. 

    Global Macro
    Both managers recorded negative returns within the style, as July's trends continued with a strong U.S. Dollar, rallying bonds and lower
energy prices. Our global trader was hurt from positions within its futures and forex baskets, with negative contribution stemming from that
manager's energy trading in crude versus natural gas. Within commodities, our manager suffered from weakness in specific commodity stocks.

    Managed Futures
    The style regained its positive standing after last month's negative performance. While many short-term traders were hurt by the
reversals in the U.S. Dollar and commodities that had begun in July, one manager was able to capture the move early and reap strong profits.
Our other manager struggled slightly in the high volatility environment, although was able to offset losses realised from bonds and metals
with positive positions in currencies and energies. 

    Relative Value
    It was a strong month for the style, despite the continued de-leveraging and general increase in risk premia. Performance was held up by
a derivative arbitrage manager, which was able to profit once again from its long call profile in the U.S. equity market. The multi-strategy
manager remained cautiously positioned during the month, offsetting losses from Asian strategies with gains from European volatility and
event-driven strategies. 


    Geographical Allocation 
 North America        40.6%
 Global                     30.4%
 Europe                   23.5%
 Asia & Other          5.5%


    Portfolio Holdings Asset Allocation 
 Strategic Hedge Funds      35.5%
 Transitional                         35.4%
 Private Equity                      19.9%
 Specialty                                4.9%
 Cash                                       4.3%


    PORTFOLIO HOLDINGS (INVESTED CAPITAL) ON 29th August 2008

 Manager                                    Type           Portfolio Weighting
 Platinum Grove Contingent Capital      Transitional              6.8%
 Offshore Fund Ltd.
 York European Opportunities Unit       Transitional              6.2%
 Trust
 Enso Global Equities Fund Ltd.         Transitional              5.5%
 Defender Ltd.                          Transitional              4.5%
 Greenpark International Investors     Private Equity             4.5%
 III L.P.
 D.E. Shaw Oculus International     Strategic Hedge Funds         4.3%
 Members Interest
 Cash                                       Cash                  4.3%
 Alydar Fund Limited                Strategic Hedge Funds         4.0%
 Rye Select Broad Market XL         Strategic Hedge Funds         3.9%
 Portfolio Ltd.
 Paulson Advantage Plus Ltd.        Strategic Hedge Funds         3.9%
 Hard Assets 2X Fund Ltd.           Strategic Hedge Funds         3.8%
 Terra Firma Capital Partners III      Private Equity             3.7%
 L.P.
 Lansdowne UK Equity                Strategic Hedge Funds         3.6%
 Thomas H. Lee Parallel Fund VI        Private Equity             3.4%
 L.P.
 Deephaven Global Multi-Strategy    Strategic Hedge Funds         3.4%
 Fund Ltd.
 Aarkad Plc                             Transitional              3.3%
 Renaissance Institutional              Transitional              3.2%
 Equities Fund International L.P.
 York Asian Opportunities Unit          Transitional              3.0%
 Trust
 Oak Hill Credit Alpha Fund             Transitional              2.9%
 Offshore Ltd.
 King Street Capital Ltd.           Strategic Hedge Funds         2.3%
 Goldman Sachs Capital Partners VI     Private Equity             2.2%
 L.P.
 Strategic Recovery Fund II L.P.          Specialty               1.7%
 MatlinPatterson Global                   Specialty               1.7%
 Opportunities Partners III L.P.
 Kaiser Trading Diversified 2X      Strategic Hedge Funds         1.6%
 Segregated Portfolio
 Coller International Partners V       Private Equity             1.6%
 L.P.
 Arcas MAC 79 Ltd.                  Strategic Hedge Funds         1.3%
 Kei Ltd.                           Strategic Hedge Funds         1.5%
 Evergreen MAC Limited              Strategic Hedge Funds         1.2%
 DFJ Athena                            Private Equity             1.2%
 Lehman Brothers Venture Partners      Private Equity             1.1%
 V L.P. 
 Silver Lake Partners III L.P.         Private Equity             1.1%
 Oaktree OCM Opportunities Fund           Specialty               0.8%
 VIIb L.P.
 Atticus European Fund Ltd.         Strategic Hedge Funds         0.8%
 AIG Brazil Special Situations II      Private Equity             0.7%
 L.P.
 Pine Brook Capital Partners L.P.         Specialty               0.6%
 Thoma Bravo Fund IX L.P               Private Equity             0.3%
 Rho Ventures VI L.P.                  Private Equity             0.1%
 HIG Bayside Debt &LBO II Fund           Specialty                 0.07%
 L.P.



    This Factsheet has been produced by Bramdean Asset Management LLP, authorised and regulated by the Financial Services Authority. It is
aimed solely at shareholders of Bramdean Alternatives Limited and it should not be relied upon by any other person.

    Please note that Bramdean Asset Management LLP has obtained information from a wide variety of sources for the content of this
Factsheet. Whilst it has made reasonable endeavours to verify such information, this Factsheet should not be used as the exclusive basis of
any investment decisions. It relates to a relatively short time period whilst many of the investments of Bramdean Alternatives Ltd are of a
long-term nature.
    
 
Bramdean Alternatives Limited invests in high risk alternative investment vehicles. It is
aimed at professional or sophisticated investors who intend to hold their investment
for the longer term. If you are not a professional or sophisticated investor you should take independent financial advice in relation to any
proposed investment in
Bramdean Alternatives Limited.
 

    Please note that up to date information on the Company, including its monthly NAV and share prices, fact sheets, Prospectus and
portfolio information can be found at www.bramdeanalternatives.com. 

    This Factsheet will be available on www.bramdeanalternatives.com in PDF format in due course.

    Capita Registrar's helpline is 0871 664 0300 (Calls cost 10 pence per minute plus network extras). For callers outside the UK, please
dial: [phone]. 


    Registered Office: Canada Court, Upland Road, St. Peter Port, Guernsey, GY1 3QE, Channel Islands.


    CONTACT DETAILS

    Amanda McCrystal, or [e-mail]
    Bramdean Asset Management LLP. 35 Park Lane, London W1K 1RB, United Kingdom 

    T+44 (0)20 7052 9272 F+44 (0)20 7052 9273 W www.bramdean.com



This information is provided by RNS
The company news service from the London Stock Exchange
 
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