November 28, 2016 13:08 ET
TORONTO, ONTARIO--(Marketwired - Nov. 28, 2016) - Toronto Trust Management Ltd. ("TTML") announced today that, while it will continue its general policy of limiting new subscriptions for units of Friedberg Global Macro Hedge Fund (the "Fund"), it will allow existing investors in a related global-macro programme based fund to invest the proceeds from their redemptions from that related fund in units of the Fund. The related fund was established to allow investors to achieve substantially the same returns as would result from an investment in the global-macro programme through the use by that fund of a forward contract arrangement. As a result of Canadian tax changes, the related fund is to be wound up. The current net asset value of the related fund is approximately US$27 million.
In 2010 it was announced that, while redemptions were not being suspended, there would be a suspension of acceptance of subscriptions to the Fund, because of the likelihood that any substantial inflow of net new subscriptions would dilute existing investors due to the high degree of volatility in credit derivatives and the extreme difficulty to faithfully replicate the position of over-the-counter traded credit default swaps that the Fund maintains. As a result, it was determined that it would be in the best interests of the Fund's unitholders to temporarily close the Fund to new subscriptions. Subsequently, it was announced that subscriptions would be accepted for a period of time (which has since expired) to match, as closely as possible, the amounts of cash outflows of the Fund, primarily due to fees and redemptions, but that priority would be afforded to subscriptions from deferred income plans, in the interest of both existing and prospective investors in the Fund since the Fund is best suited for deferred income plans, which tend to have longer holding strategies and are not affected by tax considerations. TTML believes that current market conditions allow for the limited opening of the Fund without causing adverse effects to the existing unitholders.
TTML has determined that this limited temporary opening of the Fund is appropriate, and consistent with its previous announcements.
TTML will review this decision on an ongoing basis with a view to fully re-opening the Fund to new investors when appropriate.
Dan ScheinerVice-President416-350-2924416-364-0572 (FAX)
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