1. 23 JULY 2009 OCTOPUS INVESTMENTS Paul Chedzey Manager, Strategic Partnerships October 2010

2. Survey Results How Octopus can help Asset allocation – the case for true multi asset Active V’s Passive Defensive V’s Growth How Octopus can help Agenda

3. MISMATCHED VALUE What matters to clients? For illustration purposes only

4. OCTOPUS PORTFOLIO MANAGER “... a low cost, high specification, discretionary managed portfolio, with no minimum investment...”

5. Asset Allocation – a short history Pre 2002 – 3 asset classes And that’s where most left it! Cash Bonds Equity Cash UK Bond Int. Bond UK Gilt UK EquityProperty Emerging markets Pacific ex Japan Japan Equity North American Equity 2002 – DT, B&H

6. Asset Allocation – a short history 2004 UCITS 3 Birth of Multi-assets Ability to use additional asset classes, such as: Alternatives Hedge funds Commodities 2008 Lehman Brothers: Does Multi Asset work? Yes, diversification is the driver

7. 7 Source: North/ Lipper. Data 10 calendar years to 31 st December 2009. Diversification by Asset Class 2000200120022003200420052006200720082009 Commodities 20.3% Property 7.1% Commodities 11.2% Euro Equities 29.8% Property 18.9% Commodities 37.0% Euro Equities 20.1% Commodities 18.5% Global Bonds 45.1% UK Equities 30.1% UK Corp Bonds 11.2% UK Corp Bonds 6.1% Property 10.4% UK Equities 20.9% Euro Equities 13.8% Euro Equities 24.1% Property 18.1% Euro Equities 15.7% Gilts 12.8% Euro Equities 20.1% Property 10.5% Gilts 3.0% UK Corp Bonds 10.0% US Equities 15.7% UK Equities 12.8% UK Equities 22.0% UK Equities 16.8% Global Bonds 9.5% Commodities 5.6% Commodities 19.8% Global Bonds 10.4% Global Bonds 1.8% Gilts 9.3% Property 11.2% UK Corp Bonds 6.7% Property 18.8% US Equities 1.6% UK Equities 5.3% UK Corp Bonds -4.1% US Equities 12.6% Gilts 8.7% US Equities -9.6% Global Bonds 7.9% UK Corp Bonds 5.4% Gilts 6.6% US Equities 17.3% UK Corp Bonds 0.7% Gilts 5.3% US Equities 12.8% UK Corp Bonds 10.8% Euro Equities 1.7% UK Equities 13.3% UK Equities -22.7% Global Bonds 4.0% Global Bonds 4.3% UK Corp Bonds 9.0% Gilts 0.7% US Equities 3.7% Property -22.5% Property 2.2% US Equities -1.9% Commodities -14.1% Euro Equities -27.1% Gilts 2.1% Commodities 3.7% Gilts 7.9% Commodities -0.4% UK Corp Bonds 1.8% Euro Equities -24.0% Gilts -1.2% UK Equities -5.9% Euro Equities 20.1% US Equities 29.6% Commodities -2.1% US Equities 3.4% Global Bonds 7.3% Global Bonds -4.7% Property 5.5% UK Equities 29.9% Global Bonds 7.6%

8. Why drift matters - illustration 8 25% 50% 75% 100% Months 3 6 9 12 Equities Cash Fixed Risk Profile 5 Risk Profile 6 Portfolio Breakdown Point OPM Rebalances Actual rebalance

9. Rebalancing and drift “We also saw an increase in the number of complaints about portfolio managers not responding quickly enough to difficult investment conditions.” Financial Ombudsman Annual Review 2009/2010

10. Tactical asset allocation manager risk IMA Cautious Managed Sector Source: Lipper. IMA Cautious Managed returns over discrete 12 month calendar periods 01/01/07to 31/12/09. Sterling returns. Net income reinvested

11. Investment focus “Consumers have complained to us that they believe the description of some funds as “cautious” failed to reflect the real risks involved.” Financial Ombudsman Annual Review 2009/2010

12. For illustrative purposes Investment allocation and selection

13. 13 Active v Passive – 5 years Source: Lipper, Octopus Investments

14. 14 When buying passive works Source: Lipper, Octopus Investments Active (IMA UK All Companies)Passive TopSector Av.BottomI Share FTSE 100 01/03/09 – 31/12/09126451158

15. 15 When buying active works Source: Lipper, Octopus Investments Active (IMA UK All Companies)Passive TopSector Av.BottomI Share FTSE 100 01/01/10 – 22/07/10311-7-3

16. 16 Tilting to trend Source: Lipper, Octopus Investments

17. 17 Tilting to trend Source: Lipper, Octopus Investments

18. For illustrative purposes Investment allocation and selection

19. * For illustrative purposes, portfolios will contain a greater number of funds International Equity UKEquityUKEquity AlternativeStrategiesAlternativeStrategies Fixed Income iSHARES S&P 500 USD Neptune European Opportunities Nevsky Global Emerging Markets Majedie UK Equity Schroder UK Alpha Plus iSHARES FTSE 100 Thames River Longstone JP Morgan Global Convertibles JPM Cautious Total Return Franklin Templeton Global Bond iShares FTSE All Stocks Gilts M&G Strategic Corporate Bond Ten Investment Profiles

20. iSHARES S&P 500 USD Neptune European Opportunities Nevsky Global Emerging Markets Majedie UK Equity Schroder UK Alpha Plus iSHARES FTSE 100 Thames River Longstone JP Morgan Global Convertibles JPM Cautious Total Return Franklin Templeton Global Bond iShares FTSE All Stocks Gilts M&G Strategic Corporate Bond * For illustrative purposes, portfolios will contain a greater number of funds International Equity UKEquityUKEquity AlternativeStrategiesAlternativeStrategies Fixed Income Ten Investment Profiles

21. OCTOPUS PORTFOLIO MANAGER “... a low cost, high specification, discretionary managed portfolio, with no minimum investment...” ANY QUESTIONS?

22. IMPORTANT INFORMATION This document is for the use of professional advisers only and is directed only at persons in the UK. Past performance is no guide to future performance. The value of an investment, and any income derived from them may go down as well as up and an investor may not get back the full amount invested. When considering what action to take, investors should seek their own personal financial advice from an appropriately authorised independent financial adviser. Octopus Investments Ltd is not able to provide investment advice. Any investment should be made solely on the basis of the information contained in the product brochure and product terms and conditions attached to the application form. Rates of tax, tax benefits and allowances are based on current legislation and HM Revenue and Customs practice These may change from time to time and are not guaranteed. This document is exempt from section 21 of the Financial Services & Markets Act 2000 and is not required to be and has not been approved for the purposes of the section because it is only being communicated to selected Investment Professionals (as defined under article 19 of the Financial Services & Markets Act 2000 (Financial Promotion Order 2005)). If this document is forwarded to any other person, you must ensure that you have taken responsibility for the document under the financial promotions rules and identified yourself as the issuer. The information in this document was captured on10 September 2010 and therefore is not current. Octopus Investments is authorised and regulated in the UK by the Financial Services Authority, 25 The North Colonnade, Canary Wharf, London E14 5HS. Registered office: 20 Old Bailey, London, EC4M 7AN. Registered in England & Wales under No. 3942880. For further information on Octopus products please call 0800 294 6862 or email info@octopusinvestments.com 0779-01-OPM-0910info@octopusinvestments.com

23. 23 JULY 2009 QUESTIONS & ANSWERS Paul Chedzey pchedzey@octopusinvestments.com 0207 776 3172 07766 422229 20 Old Bailey London EC4M 7AN 0800 316 2295 www.octopusinvestments.com