EFTA01458254.pdf

eke pouithant Fccia The be./ Whips Itionvocre viffie Illiquid alternatives emet,eiss Neepactioos PrAtiolth ii.aiwirretuon Illiquid Private hedge 30.0% equity funds Portfolio Our view of non-traditional asset classes Alternatives portfolios Infra- structure__ Due to their distinct characteristics, we take a Real estate differentiated look at selected liquid and illiquid alternative investments. Liquid alternatives Illiquid alternatives Event-driven Infrastructure Equity special-situation-orientated managers and those running Record investments in hotel assets worldwide have been moderate net exposures (i.e. with long and short exposures to taking place this year. Jones Lang LaSalle (..ILL) has reported the market that are roughly in balance) continue generally to fare that global hotel transactions reached $42 billion in the first better than their credit and more directional peers. Within the half of 2015. The Americas accounted for the largest share of merger-arbitrage sector, we prefer nimble and smaller managers deal volumes, with a total of S2_4 billion, up 73%year-on-year. which can operate within the small- to mid-cap segments of This was followed by Europe, Middle East and Africa (EMEA), the equity market. Headline deals' spreads remain tight and a up 55% to $15 billion, while the Asia Pacific region saw a slight significant amount of capital is being put to work there. On the decline in investment volumes, down 6% to $4 billion. Although positive side, the mergers-and-acquisitions ltiA&A, spine is now still a relatively small part of the market, hotels are gaining expanding at full speed to Europe. Strategies based around increasing investor attention. The sector is benefiting from rising this approach weathered last month's more volatile conditions growth in global travel (both business and tourism) and positive reasonably well. revenue growth. However, over the medium term some parts of the industry are likely to be disrupted by the emergence of • Equity long/short alternative accommodation options such as Airbnb. With the MSCI Wodd price-to-earnings muhip€e at around 18 and with such strategies historically relatively insensitive to overall market movements, any benefits from overall market gains are likely to be somewhat muted. As the start of the Fed hiking cycle is in sight, we would suggest that managers focussing instead on value sectors of the market should be favored. The equity trading environment continues to be favorable for arbitrage-orientated managers based on fundamental factors. The current earnings season and the possible start of the U.S. rate-hiking cycle are also contributing to increasing differentiation in single stocks' and sectors' performance. liquid alternatives Event-driven/ Equity relative long/short value Sources; Deutsche Asset & Wealth Management Investment GmbH, Deutsche Bank AG Filiale London, as of 8/17/15. This allocation may not be suitable for all investors. In our balanced model portfolio, we currently allocate 10% to alternative investments (see - Portfolio- ). Commodity Trading Advisor Credit _ Macre/CM" Please refer to the following interview for the regulatory requirements for the offer or sale of alternative investments. 140 rat. Ce.)1/4*i AmtegiA.E.Ii6x.l.SW4rAtst. CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0118081 CONFIDENTIAL SDNY_GM_00264265 EFTA01458254