Wawona Worldwide Capital, LLC

Judy Liu and Michael Kondracki design and manage hedge fund portfolios for high net worth individuals and institutional investors.

Ms. Liu and Mr. Kondracki use a "state of the art" database of some 2,000 hedge fund managers and proprietary selection risk/reward techniques to develop portfolios of hedge funds, or funds of funds. Ms. Liu and Mr. Kondracki participate in selected primary brokerage forums for hedge funds run by Credit Suisse, Lehman Brothers, Bear Stearns, Morgan Stanley, BankofAmerica, Salomon Smith Barney, Deutsche Bank and UBS, among others. Through such forums they may meet approximately 30 - 40 hedge fund managers each month.

To commence manager selection, Ms. Liu and Mr. Kondracki take a broad approach by performing a top-down analysis to determine sector allocation based on the fundamentals of the global economy and the hedge fund industry. Next they look for outstanding managers in the sectors they have chosen through a quantitative screening process. They review the historical returns of each manager to determine the risk/reward relationship between the manager and its peers and benchmarks and calculate the manager's correlation to the portfolio and to the market. To the extent that such analysis is satisfactory, a qualitative screening is performed, whereby an actual visit is made on the manager to perform due diligence to determine if the manager's investment strategies are consistent with its investment objectives. In addition, a review of company management and structure, risk management, and overall business stability is carried out before any investment decision is made.

In general, Ms. Liu and Mr. Kondracki will only review hedge fund managers with at least $25,000,000 under management that have audited financials (preferably two years by a well known auditor) and a low volatility strategy (standard deviation of 10% or less) with consistent returns, few draw downs, long solid track records, and good liquidity terms. All of their hedge fund managers work principally with listed securities and/or currencies and/or commodities. Ms. Liu and Mr. Kondracki do not take on illiquid private placement exposures or managers with “side pockets.” They may not allocate more than 5.0% of a fund's total resources to any one manager. They prefer managers with diversified portfolios, transparency, little if any leverage, and in general, to be uncorrelated to their funds' portfolios and to other existing funds' strategies, and to have a low correlation to the general market. From time to time, depending on the particular portfolio and leverage provider or principal protection provider, Ms. Liu and Mr. Kondracki may be subject to certain additional investment guidelines in accordance with the policies of a given leverage provider or principal protection provider. Ms. Liu and Mr. Kondracki have designed two series of structured funds of hedge funds.

ACAE Offshore Fund of Funds, Ltd. (The Series I Fund) is designed for net capital appreciation of 15% per annum with a targeted volatility on the portfolio of less than half that of the S&P 500. Series I is a Cayman Islands Monetary Authority registered open mutual fund.

ACAE Offshore Fund of Funds II, Ltd. (The Series II Fund) is designed for aggressive capital appreciation, and has a targeted return of 30% with a targeted volatility before fees and before leverage of less than 10.0%. Series II is a Cayman Islands Monetary Authority registered open mutual fund.

Ms. Liu and Mr. Kondracki are constantly reviewing, analyzing and developing new structured fund of funds products and portable Alpha strategies. The team has relationships with close to twenty banks in NY and London that can harness structured products and principal and interest guarantees to their hedge fund portfolios.

What is a Fund of Hedge Funds?

A diversified portfolio of generally uncorrelated hedge funds.
May be widely diversified, or sector or geographically focused.
Seeks to deliver more consistent returns than stock portfolios, mutual funds, unit trusts or individual hedge funds.
Preferred investment of choice for many pension funds, endowments, insurance companies, private banks and high-net-worth families and individuals.
Provides access to a broad range of investment styles, strategies and hedge fund managers for one easy-to-administer investment.
Provides more predictable returns than traditional investment funds.
Provides effective diversification for investment portfolios.

Benefits of a Hedge Fund of Funds

Provides an investment portfolio with lower levels of risk and can deliver returns uncorrelated with the performance of the stock market.
Delivers more stable returns under most market conditions due to the fund-of-fund manager's ability and understanding of the various hedge strategies.
Significantly reduces individual fund and manager risk.
Eliminates the need for time-consuming due diligence otherwise required for making hedge fund investment decisions.
Allows for easier administration of widely diversified investments across a large variety of hedge funds.
Allows access to a broader spectrum of leading hedge funds that may otherwise be unavailable due to high minimum investment requirements.
It is an ideal way to gain access to a wide variety of hedge fund strategies, managed by many of the world's premier investment professionals, for a relatively modest investment

If you are an accredited investor, and want more information, please answer the questions on our website http://www.acaefof.com to receive a password. The latter website is for accredited investors only.