Alternative Funds Solutions First Half 2014 Investment Outlook

Credit Suisse Asset Management, LLC

February 2014

This presentation may not be altered except by Credit Suisse. Past performance is no guarantee or indicator of future results. Please see “Important Legal Information” for important disclosures regarding the data and information contained and the views and opinions expressed in this material.

Ulrich Keller, Ph.D. Head and CIO, Alternative Funds Solutions

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We foresee challenges in navigating between improving fundamentals and policy normalization Global capital markets began adjusting in January to the Fed’s taper of its quantitative easing program (QE) that it introduced over five years ago in response to the Global Financial Crisis. Anticipating this move, 2013 was the first year of negative total returns on many “safe haven” bonds such as U.S. Treasuries, German Bunds and U.K. Gilts since 1994. Many have associated this development with asset class flow rotation into higher yielding assets (e.g., developed market equities). As we stated in our 2H 2013 Investment Outlook, we believe that capital markets will adjust to a less accommodative policy, but the ride is likely to be bumpier than the generally low volatility environment we have experienced since 2009.

Emerging markets have been—and continue to be—at center stage of the deleveraging process, hit both by diminishing global liquidity and slowing Chinese growth. In early 2014 we entered the second act, which follows the sell-off across EM assets triggered by Bernanke’s mid-year announcement of QE tapering. EM country differentiation by financial vulnerability and the political noise from 2014 elections could be a significant generator of volatility as well as trading opportunities.

Hedge Funds finished 2013 with the best performance since 2010, posting a YTD gain of 9.7% (as reflected by the Credit Suisse Hedge Fund Index), led by gains in long/short equity and event driven strategies. Returns in relative value and tactical trading strategies were more muted, yet were favorable when compared to fixed income losses in developed markets.

Key Themes:

We believe improving business confidence and supportive policy mixes point to cyclical improvement in growth in developed markets, providing tailwinds for fundamental managers: e.g., the gradual European recovery, continued Japanese momentum driven by stimulus and select EM countries that are exposed to stronger growth in DM countries;

But divergent directions in policy may result in an increase in volatility across equities, bonds and currencies;

We also anticipate directional risks could range from QE tapering to Chinese rebalancing to EM imbalances;

Crude oil is expected to remain caught between rising US production and geopolitical risk in OPEC/Middle East countries, further dislocating the WTI-LLS-Brent spread relationships. The precious versus industrial metals chasm is likely to increase especially under a growth-led USD rally and specific supply issues.

Fundamentally driven dispersion generally creates opportunities for hedge funds

Tactical Strategies (Global Macro, Managed Futures and Commodities) Asset class rotation, further degradation of bond markets and EM assets could lead to an attractive opportunity set for global macro managers.

Relative Value Strategies (Fixed Income, Quantitative Strategies and Corporates) For relative value strategies, uncertain policy tightening trajectories may result in volatility; we also anticipate more pricing inefficiencies across corporate capital structures and across asset classes, allowing trading opportunities to resurface.

Fundamental Strategies (Long/Short Equity, Event Driven Credit and Merger Arbitrage) Stock price correlations reverting to average levels has been helpful to fundamental strategies, which profited from security selection due to divergences in regional, sector and company fundamentals. After an eventful 2013, EM seems poised to turn more idiosyncratic in 2014, which should benefit stock and credit pickers, particularly in the more established Asian markets.

In terms of portfolio construction, we favor a barbell top-down portfolio approach composed of fundamental strategies aiming to capture company-specific differentiation on the one hand (with or without catalysts), and trading and relative value strategies aiming to capture macro and policy driven moves, as well as market volatility, on the other.

Message from the AFS Chief Investment Officer

Credit Suisse Asset Management

Hedge Funds and Global Markets 2013 Summary (As reflected by indices)

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2013

Performance Avg. Annualized Performance* Annualized Vol.*

Credit Suisse Hedge Fund Index 9.73% 8.72% 7.31%

Convertible Arbitrage 6.03% 7.42% 6.68% Dedicated Short Bias -24.94% -5.53% 16.58% Emerging Markets 8.81% 7.55% 14.35% Equity Market Neutral 9.27% 5.05% 9.97% Event Driven 15.47% 9.58% 6.16% Fixed Income Arbitrage 3.80% 5.44% 5.52% Global Macro 4.32% 11.34% 9.39% Long/Short Equity 17.74% 9.55% 9.65% Managed Futures -2.56% 5.09% 11.58% Multi Strategy 11.23% 8.19% 5.22%

Equities 2013

S&P 500 32.39%

Dow Jones Global Index 20.78%

STOXX 50 22.39%

Nikkei 56.72%

Fixed Income Dec 31, ’13 Yield (%)

YTD 2013 Change (bps)

10-year U.S. 3.03 127.08 10-year Germany 1.93 61.30 10-year Japan 0.74 -5.00 CS High Yield Index 5.77 (YTW) -48.00

Currencies* 2013

EUR 4.17%

GBP 1.86%

YEN -17.62%

CHF 2.52%

Commodities 2013

DJ-UBS Comm. Index -9.52%

S&P GSCI Index -2.21%

Gold -28.04%

Crude Oil 7.19%

Past performance is no guarantee or indicator of future returns. All data was obtained from publicly available information, internally developed data and other third party sources believed to be reliable. Credit Suisse Hedge Index, LLC has not sought to independently verify information obtained from public and third party sources and makes no representations or warranties as to accuracy, completeness or reliability of such information.

Credit Suisse Hedge Fund Index Correlation Statistics

Correlation from January 1994

S&P 500 0.57

Dow Jones Global Index 0.62

STOXX 50 0.56

*vs. U.S. Dollar. Source: Credit Suisse Hedge Index, LLC, Bloomberg, Datastream.

Credit Suisse Asset Management

Volatility Statistics Jun 30, ‘13 Dec 31, ’13

VIX 16.9 13.7

MOVE 99.8 73.6

*Average annualized Index data begins January 1994. Source: Credit Suisse Hedge Fund Index. It is not possible to invest in an index.

Sector Strategy Sub-Strategy Outlook 1H 2013

Outlook 2H 2013

Outlook 1H 2014

Recommended Allocation Change 2H 2013 - 1H 2014

Fun

dam

enta

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Equity Long/Short

Opportunistic ++ ++ ++

Neutral

Low Net + + +

Stock Picker + + +

Macro = = = Trading – – – Activist = ++ ++

Event Driven

M&A – = =

Neutral Distressed / Credit = = =

Multi-Process + + +

Special Situations + + +

Rel

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Fixed Income

Fixed Income Arbitrage = = =

Neutral Agency Mortgages = + = Structured Credit ++ = + Yield Alternatives = = =

Corporate

Credit Long/Short – = =

Neutral Corporate Arbitrage = = + Volatility = = – Quant Equities = ++ +

Multi-Strategy Diversified + + ++ Moderate

Increase FI Multi-Sector/Credit = = =

Tact

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Tra

din

g Global

Macro

Diversified + ++ ++

Moderate Increase

Quant = – – EM Focus ++ + + Currency + = +

CTA

Trend Following - Short Term – + =

Neutral Trend Following - Diversified = – – Systematic Multi-Strategy + = + Non-Trend / Mean Reversion + ++ ++

Commodities Commodities = + – Moderate Decrease

++ Positive + Moderately Positive

= Neutral Moderately Negative – – Negative

First Half 2014 Investment Outlook Summary

4 Credit Suisse Asset Management

Source: Credit Suisse The above should not be viewed as a current or past recommendation or a solicitation of an offer to buy or sell any securities or investment products or to adopt any investment strategy. It does not take into account the financial objectives, situation or needs of any persons which are necessary considerations before making any investment decision. It does not take into account the financial objectives, situation or needs of any persons which are necessary considerations before making any investment decision. The information provided is not intended to provide a sufficient basis on which to make an investment decision and is not a personal recommendation or investment advice. It is intended only to provide observations and views of the said individual Asset Management personnel at of the date of writing without regard to the date on which the reader may receive or access the information. The reader should not assume that any investments in companies, securities, sectors, strategies and/or markets identified or described herein were or will be profitable and no representation is made that any investor will or is likely to achieve results comparable to those shown or will make any profit or will be able to avoid incurring substantial losses. Each investor’s portfolio may be individually managed and may vary from the information shown in terms of portfolio holdings, characteristics and performance. Current and future portfolio compositions may be significantly different from the information shown herein. Investing entails risks, including possible loss of some or all of the investor’s principal. To the extent that these materials contain statements about future performance, such statements are forward looking and subject to a number of risks and uncertainties. All opinions and views about to be expressed are subject to change at any time.

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Tactical Trading Strategies—Global Macro

+ In a context of slow but continuing global economic recovery, economic and monetary policies have begun diverging between ongoing accommodative stances by the European Central Bank and the Bank of Japan, and the rate policy transitions unfolding in the U.S. and UK;

+ We anticipate “the tone” of the year may lie more with the U.S., China, Japan and weak EMs; sources of directional risks range from QE tapering, Chinese rebalancing to EM imbalances;

+ Recovery (with corrections) is the new working order of EU peripherals, as bearish bets rotate towards widening within the core;

+ We believe a similar emphasis on policy effectiveness and asset allocator behavior is necessary for assessing next steps for Japan themes;

+ EM macroeconomic dispersion and a heavy electoral schedule may allow for both thematic and tactical opportunities;

+ We continue to favor managers with broad capabilities across asset classes and across EM regions; and

+ We prefer non-biased managers who can cross-trade in EM FX and rates/sovereign credit on a joint basis, and less in equities, with the exception of very tactical /short term index exposures.

Central Bank Policies Are Likely to Continue Diverging in 2014

Source: Credit Suisse and Bloomberg. All data was obtained from publicly available information, internally developed data and other third party sources believed to be reliable. Credit Suisse has not sought to independently verify information obtained from public and third party sources and makes no representations or warranties as to accuracy, completeness or reliability of such Information.

Normalization in term structure/monetary policy and regional divergence may create trading opportunities; we continue to favor tactical macro managers with multi-asset capability.

Credit Suisse Asset Management 5

Tactical Trading Strategies—Commodities and Managed Futures

Commodities

± Commodities continued their de-coupling from other risky assets in 2013, while lagging in general; + Low inter-commodity correlations suggest re-emergence of fundamentals as a driving force; − Investors are leaving the space as the recent market movement was viewed by some as the end of

the commodity “super cycle”; + We favor specialist sector traders able to evaluate and exploit the impact of structural dislocations

and bottlenecks at the front end of curves; + Also, tactical traders who can profit from both fundamentals as well as short-term market flows; and − We are underweight long-biased managers.

Managed Futures

± Medium and long-term trend followers still have high beta to global equities; − Continued central bank interventions could cause repetitive reversals, which would hurt trend

followers; + We favor CTAs with more diversified allocations to asset classes/traded instruments, not overly

dominated by one particular asset class; and + We also like multi-strategy quant funds that are not biased towards trend following.

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Despite headwinds, Commodities and CTAs may find opportunities in more volatile markets.

Correlations Between Trend Followers and Global Equities Trended Higher in 2013

Credit Suisse Asset Management

Source: Credit Suisse, Newedge Trend and Bloomberg. All data was obtained from publicly available information, internally developed data and other third party sources believed to be reliable. Credit Suisse has not sought to independently verify information obtained from public and third party sources and makes no representations or warranties as to accuracy, completeness or reliability of such information.

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Relative Value Strategies—Fixed Income

Relative value opportunities are expected to improve as the Fed eases off the pedal.

Fixed Income Arbitrage ± Fed tapering may introduce greater uncertainty into rates markets and constrain equity upside

should positive surprises be met with policy tightening; ± Decoupling of policy cycles across developed markets and changes in growth expectations may

create flow-driven and relative valuation opportunities; and + While we expect systemic risks to be lower, complacency in sovereign debt markets appears

widespread; as a result, we favor cheap sources of optionality.

Agency Mortgages ± Agency derivative valuations are not cheap but offer attractive carry and negative duration;

Prepayments may be more driven by traditional factors such as housing turnover; − Policy risk lingers with Mel Watt leading the FHFA; MBS basis will largely be driven by the Fed; and + We favor relative value strategies that exploit structural or technical inefficiencies.

Structured Credit ± Yields have compressed but remain attractive relative to other fixed income assets; ± The beta trade is ending as home price appreciation is priced in; RMBS/CMBS fundamentals are

improving but the recovery may slow as rate risk increases; + Potential upside from GSE policy changes and litigation settlements.

Yield Alternatives ± Reinsurance premiums are expected to compress in insurance-linked products due to large inflows

into the asset class and lower than expected insured losses in recent periods; and ± Yield compression in asset-based lending continues as demand rises due to bank lending

contraction, especially to non-core borrowers such as smaller enterprises and those in emerging markets.

Source: Credit Suisse and Bloomberg. All data was obtained from publicly available information, internally developed data and other third party sources believed to be reliable. Credit Suisse has not sought to independently verify information obtained from public and third party sources and makes no representations or warranties as to accuracy, completeness or reliability of such information.

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The New Tapering Regime May Induce a Structural Decompression of Fixed Income Volatility

Corporate—Credit Long/Short ± Fundamentals remain healthy as defaults have been benign but rates may be a source of volatility; − Technicals are less supportive with increasing issuance and continued outflows from fixed income;

single name liquidity may be most challenged given dealers’ reduced risk appetite; + Select themes in European financials and loans that benefit from regulatory changes, improving

growth, and accommodative monetary policy. Corporate—Arbitrage + Increasing convertible new issuance volumes likely to remain a tailwind; + Corporate activity may create attractive intra-capital structure opportunities; convertibles may

outperform in a rising rate environment from embedded equity exposure. Corporate—Volatility ± Further volatility compression appears unlikely and changing monetary policies may result in a more

“normal” volatility range; tail concerns have receded but growth risks remain; ± We favor being long convexity given the widespread complacency; volatility strategies are attractive

diversifiers despite muted base case return expectations. Corporate—Quantitative Equities + Current levels of stock correlations/dispersion are healthy for quant equities; a less “risk-on” or

macro-driven environment may result in more idiosyncratic stock movements; + Investor rotation into equities may create tradable pricing inefficiencies /short-term distortions.

Multi-Strategy—Fixed Income Multi-Sector/Credit ± As yields decline across the board, we favor managers who are thoughtful about top-down

risks/drivers, sensitive to technical dynamics, and aware of changes in the price of liquidity; − Fed tapering may drive rate volatility and funds may still be susceptible to a duration sell-off.

Multi-Strategy—Diversified + The cost of equity remains high relative to debt and we expect to see pressure on management to

unlock value through corporate activity; ± Shifting cross-asset class correlations may limit the effectiveness of portfolio construction; a more

stable systemic backdrop and lower cost of macro hedging may allow managers to take more risk.

Source: Barclays

8 Credit Suisse Asset Management

Relative Value Strategies—Corporate and Multi-Strategy

We see a better environment for market neutral strategies and corporate event trades.

Cost of Equity vs. Baa Corporate Yields Global Convertible Issuance Was Up in 2013 ($bn)

All data was obtained from publicly available information, internally developed data and other third party sources believed to be reliable. Credit Suisse has not sought to independently verify information obtained from public and third party sources and makes no representations or warranties as to accuracy, completeness or reliability of such information.

Source: BlackRock

Source: Credit Suisse and Bloomberg All data was obtained from publicly available information, internally developed data and other third party sources believed to be reliable. Credit Suisse has not sought to independently verify information obtained from public and third party sources and makes no representations or warranties as to accuracy, completeness or reliability of such information. Past performance is not a guarantee or indicator of future results.

9 Credit Suisse Asset Management

Fundamental Strategies: Long/Short Equity Corporate fundamentals remain solid in terms of driving differentiation, creating a balanced opportunity set long and short. Environment + Developed market valuations have reached fair levels, mainly fueled by multiple expansion. However,

factors supporting fundamentally-based long/short strategies continue to point to a favorable environment, including persistently low intra-stock price correlations and high dispersion among companies, sectors and regions;

+ Barring significant liquidity shocks or drastic policy regime changes, we believe the story for long/short equity continues to be increasingly stock specific with higher expected return dispersion;

+ Given tempered expectations for equity market performance in 2014, the beta component of returns is expected to decrease, making alpha generation a key differentiator among long/short equity managers; and

± After a de-rating in absolute and relative terms in 2013, EM equities seem to display more idiosyncratic pricing potential as well. For example, pockets of growth create long opportunities (e.g. Chinese internet), whereas structural challenged industries yield short ideas (e.g., commodity-sensitive cyclicals).

Themes + Global financials: Sector is in a transitional state after an initial deleveraging phase and pricing in of

regulatory burden; + Global technology: Usage shifts continue to create growth trajectory divergences across the globe; + Telecoms: Sector consolidation presents catalyst driven opportunities in the U.S. and Europe; and + Activist approach: Companies are more receptive to activist approaches as the pressure to improve

shareholder value has increased considerably.

Recommendations + Managers targeting stock-specific and idiosyncratic opportunities, managing with a low or variable-

net and high gross-exposure mandate, focusing short books on single-name stocks and making use of options as a protection mechanism and return enhancer when volatility is inexpensive;

− Managers taking significant net exposure and/or moving down the liquidity spectrum.

Correlations Spikes Have Receded; Manager Performance Has Rebounded.

Fundamental Strategies: Event Driven

10 Credit Suisse Asset Management

Flow and Pipeline of Sales Anticipated From European Commercial Banks

Source: PwC Snapshot Deleveraging Non-Core Loan Portfolios, Oct. 2013.

Example of Value Enhancing Corporate Action: Corporate Share Buybacks (S&P 500 ex-Financials)

Source: Birinyi Associates.

Special situation investments are anticipated to be a primary driver for the strategy, bolstered by continued business model and balance sheet rationalizations.

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All data was obtained from publicly available information, internally developed data and other third party sources believed to be reliable. Credit Suisse has not sought to independently verify information obtained from public and third party sources and makes no representations or warranties as to accuracy, completeness or reliability of such information.

Special Situations + Value-enhancing corporate actions may continue to accelerate, including accretive acquirers,

activism, divestitures, hostile bids, share buybacks and spin-offs; + While 2013 was the tide that lifted all boats, we expect differentiation and manager selection to be

much more of a factor in 2014, as valuations have increased and alpha should represent a higher portion of overall returns over market beta; and

− We maintain our cautious view on basis risk, inherent directionality and strategy drift.

Mergers and Acquisitions + Fundamental and supportive drivers for M&A are still unchanged, such as low interest rates, market

strength and stability and cash-rich companies; + Corporate profits are expected to remain high due to cost extractions, but revenue growth still

strained; M&A may experience an uptick as another potential avenue for longer term revenue growth; + Activity is still on the rise driven by highly strategic intra-industry transactions, such as in

healthcare; and − We remain wary of “plain vanilla" merger spread trades that exhibit low returns and high risk. Distressed Credit + Looser underwriting credit standards have been setting up for an anticipated robust supply of

distressed credits to come in the next few years; + Specialist players in selective pure distressed/restructuring situations may continue to benefit from

emerging situations and an expected robust pipeline of opportunities; + Complex legacy situations may still offer downside protection and are generally uncorrelated to overall

markets; + Gaining further traction, the European de-leveraging process may continue to offer opportunities; − Select distressed sectors and one-off situations may continue to offer investment plays, although

may be more illiquid and best handled by specialist managers; and − The low-default rate environment is expected to continue in the near-term.

For more information, please contact:

Credit Suisse Asset Management 11

Americas Christian Hoffmann +1 212 538 8616 christian.hoffmann@credit-suisse.com EMEA/Switzerland (Institutional) Dirk Wieringa +41 44 332 0984 dirk.wieringa@credit-suisse.com Japan Akira Takahashi +81 3 4550 9232 akira.takahashi@credit-suisse.com Non-Japan Asia Michael Levin +852 2101 7665 michael.levin.2@credit-suisse.com

Important Legal Information

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This material has been prepared by the Asset Management division of Credit Suisse (“Credit Suisse”) and not by Credit Suisse’s Research Department. It is not investment research or a research recommendation for regulatory purposes as it does not constitute substantive research or analysis. This material is provided for informational and illustrative purposes and is intended for your use only. It does not constitute an invitation or offer to the public to subscribe for or purchase any of the products or services mentioned. The information contained in this document has been provided as a general market commentary only and does not constitute any form of regulated financial advice, legal, tax or other regulated financial service. It does not take into account the financial objectives, situation or needs of any persons which are necessary considerations before making any investment decision. The information provided is not intended to provide a sufficient basis on which to make an investment decision and is not a personal recommendation or investment advice. It is intended only to provide observations and views of the said individual Asset Management personnel at of the date of writing without regard to the date on which the reader may receive or access the information. Observations and views of the individual Asset Management personnel may be different from, or inconsistent with, the observations and views of Credit Suisse analysts or other Credit Suisse Asset Management personnel, or the proprietary positions of Credit Suisse and may change at any time without notice and with no obligation to update. To the extent that these materials contain statements about future performance, such statements are forward looking and subject to a number of risks and uncertainties. Actual events, results or performance may differ materially from those reflected or contemplated in such forward-looking statements. Readers are cautioned not to place undue reliance on such statements. Credit Suisse has no obligation to update any of the forward-looking statements in this document. Information and opinions presented in this material have been obtained or derived from sources believed by Credit Suisse to be reliable, but Credit Suisse makes no representation as to their accuracy or completeness. Credit Suisse accepts no liability for loss arising from the use of this material. If nothing is indicated to the contrary, all figures are unaudited. All valuations mentioned herein are subject to Credit Suisse valuation policies and procedures. It should be noted that historical returns and financial market scenarios are no guarantee of future performance.

The charts, tables and graphs contained in this document are not intended to be used to assist the reader in determining which securities to buy or sell or when to buy or sell securities.

Every investment involves risk and in volatile or uncertain market conditions, significant fluctuations in the value or return on that investment may occur. Investments in foreign securities or currencies involve additional risk as the foreign security or currency might lose value against the investor’s reference currency. Alternative investments products and investment strategies (e.g. Hedge Funds or Private Equity) may be complex and may carry a higher degree of risk. Such risks can arise from extensive use of short sales, derivatives and leverage. Furthermore, the minimum investment periods for such investments may be longer than traditional investment products. Alternative investment strategies (e.g., Hedge Funds) are intended only for investors who understand and accept the risks associated with investments in such products.

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