Investment Objectives :

Founded in April 2001, R. P. Sélection Convertibles is a pure Convertible play with a focus on Europe.
The fund has a reactive and pragmatic approach looking for worldwide opportunities without « a priori», and according to the market sentiment.

Management Report :

In December, the fund rose1.57% in a favorable environment for equity markets.
We maintained our fixed income base with a high bond floor (89%) along an equity delta at 33.5%.

Therefore, we bought post restructuring Risanamento 2014 convertible, guaranteed from now on by a
pool of italian banks. Trading at 9.5% yield to maturity, this investment seems promising even if there is
no equity sensitivity.

We increased our holding in International Power in the UK, which allies good fundamentals to
speculative aspects (notably takeover rumours from GDF Suez).

On the other hand, we sold part of our holdings in Bulgari in the Luxury industry and in the insurer
Baloise which had gained 6% since our purchase despite the stock had decreased by 10%!

This illustrates perfectly our sentiment for 2010 that investment grade papers are clearly overvalued
and over bought by the funds strictly liable to ratings.

It strengthens our investment policy for 2010 favoring non rated or non investment grade convertible
bonds of quality which according to us offer the most upside potentials.

Advertorial in FinRoad