HUBUS133 Alpha Group Capital HUDSON BAY CAPITAL Portfolio Level Risk Mitigation Maintaining Portfolio Diversification is a Critical Component of Risk Management • Industry standard measures of diversification like correlation and covariance have not kept pace with the increasing complexity and dynamism of today's financial instruments Risk Management Hudson Bay Approach • Proprietary RMon system` monitors diversification using cluster analysis • Seek to identify concentration risk in the portfolio • Focus on economically significant relationships; filters out noise Philosophy: Rion - Gerber Statistic Practice: R.Mon - Deal Code (luster Analysis 4 $6aux • S&P 600 20tos $I3(.(ik i t: -ttiP,• •-• ..• :•-.!•• : 7 ; ', , - • ;;II• Pa • 44 • 41 - , . / • O. • T • M. 4 3, • .4 . • . • UM OM . T. • 4•1 • ..... • St I/ JIMMIES& T, 4 , i tee. • .. g — ea 0 Mee. re . .7-. empe )Nit aemit ,..• • ..„. 4 IN # 44.4 1 42% 4 4. --to 14. • •1 • ..• Mit 4,4 7 a if Lev, : , , .t.Wifillir -AT. , 43 C IC, t .,- • e. .. ./. finilL •311.: 14, 4 .41 • 4V1. , • An , 4 4.4 mop :...,, . en. % I% .ne. 6 In- :..... COME. Mena .1.41 XL. 1 5 to 5 Nell '.! 71 3 11 €41jn.4 T. 4 . 1 t 11 .1 449 • 241 • ft. • Y. • , s ..... 4 •ell. e 04. BM Le• • er. 4, ) Xi t 3/ I/ t X/ • 3/ 3 Se. MEV 37. I in . ;.. a an. ) r. • O. ; 0. , - .0. • 0. 20. 'I 2T: 0 . MI • 1.. $ in . 41 S I 44 4 1. , I 34 • • -. . e CI" WA on • I et Sift: X , 414 T PIN • T 11.11 • .1.4 Jee • 44 11 0 .140 1144 3.43 57.• 347▪ .3 MOP :•7 oft • Y. let • ••• O W' tin • 2.•% ccaNIPME, $ a, • .0. . .ix • 4 :Oa T. • 4, 334 III • T. • $11 .•••4 4.1 4 IR Hell LK — falre "" :raging, ni eve :Tut 4 CM I Ten, .1, SRN • TM. • X.44 re $4.4 34% 4 T. 11 an 4 V- I in :.r • - ate,. . 11 • 71 t AN. Mir 1, • 4/. TN. 5 MAI 4 .14. 5 • .4.4 t 4 $ T3 33.. MI K ••••• •31• ".. ••" S 3.3% • 3' 3 3 •'.3. • • ' 31' 3 •fl •-•3 • 33' `C. .3 •3333 .tec • •-.‘ ; ••••. • 0, • c• 1 )74 :VI aft # I/ 3 473 T.44 4 ITU • .24 • I lb/ % a et • Arn Y. .2114 tWe 5 .1 .4 1 IN 4 te1 11% IN • •••Th . 41 ) N. • el 4 112...1 • 3N I .11111 Id/ II MS I 44415 'flaws 4 7. A, lets •9••••••k 2 IN% :ILIA: 445 ) IN 4.4, • :4 sit. •Whl An. I >et c•A or. in, • • w ..4.3 • • .3 tie% • • • -• t • Please refer to the Appendix for more details information on our Risk Monitoring and Mitigation Systems • US Patent No. 8.577.775 and additional patents pending CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) CONFIDENTIAL DB-SDNY-0084911 SDNY_GM_00231095 EFTA01384592