Hedge Funds Fall in October; Inflation Concerns Upset the Markets.

GREENWICH, Conn. -- The Van Global Hedge Fund Index ("VGHFI" or the "Index") lost -1.2% in October while the Van Composite Investable Index ("Investable Index") fell -0.9%, according to hedge fund index provider Greenwich-VAN Advisors, LLC (VAN).

"Hedge funds struggled during the month as rising inflation resulted in falling equity and bond prices," noted Kevin Campbell, Vice President of VAN. "As a result, most hedge fund strategies struggled and only five of the twenty hedge fund indices increased in value in October. The Van Global Short Selling Index, which consists of managers with a dedicated short bias, led the way, rising by 3.1%. The Van Global Emerging Markets Index, singled out last month as the best performing strategy over the last three years, suffered the biggest loss, falling -2.8%."

In spite of October's losses, hedge fund returns remain solidly positive for the year. The VGHFI has increased 5.0%, led by the Van Global Emerging Markets Index, which is up 9.9% this year. Only three of the twenty hedge fund indices tracked by VAN (Convertible Arbitrage, Futures, and Market Timing) are negative for the year.

As currently calculated, October 2005 returns for the Van Global Hedge Fund Indices are shown below.

Oct. 2005  YTD 2005
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Van Global Hedge Fund Index          -1.2%       5.0%
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Market Neutral Group                 -0.4%       3.4%
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  Equity Market Neutral              -0.3%       5.3%
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  Event-Driven                       -1.0%       5.0%
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     Distressed Securities           -0.2%       7.0%
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     Merger Arbitrage                -0.7%       3.7%
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     Special Situations              -1.6%       3.9%
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  Market Neutral Arbitrage            0.1%       2.0%
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     Convertible Arbitrage           -0.1%      -2.6%
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     Fixed Income Arbitrage           0.7%       5.1%
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     Other Arbitrage                 -0.1%       3.0%
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     Statistical Arbitrage           -0.2%       3.7%
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Long/Short Equity Group              -1.8%       6.3%
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  Aggressive Growth                  -1.8%       3.5%
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  Opportunistic                      -2.7%       7.7%
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  Short Selling                       3.1%       8.9%
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  Value                              -2.0%       6.6%
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Directional Trading Group            -1.0%       1.1%
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  Futures                            -1.5%      -1.7%
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  Macro                               0.9%       6.9%
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  Market Timing                      -2.2%      -1.1%
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Specialty Strategies Group           -1.6%       7.1%
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  Emerging Markets                   -2.8%       9.9%
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  Income                              0.4%       5.4%
-----------------------------------------------------
  Multi-Strategy                     -0.6%       4.4%
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The Van Global Hedge Fund Index fell to a value of 13,009.58 in October. The Index had an initial value of 1,000 at January 1, 1988. Over its 17 year and 10 month history, the Index generated a net compound annualized return of 15.5%, compared to an 11.8% compound annualized return for the S&P 500. Past performance of the Van Global Hedge Fund Index may be viewed at our website at www.vanhedge.com.

Van Composite Investable Index

The Van Composite Investable Index fell -0.9% in October and is up 3.5% for the year. The Investable Index has achieved an annualized return of 11.1% versus an annualized return of 10.9% for the VGHFI since the Investable Index's inception. Its correlation of 0.96 and Beta of 0.97 to the Van Global Hedge Fund Index demonstrates the Investable Index's ability to represent the broader hedge fund universe.

Comparative Benchmarks

For comparison purposes, the S&P 500 lost -1.7%, the Morgan Stanley Capital International World Equity Index ("MSCI WEI") lost -2.5%, the Nikkei 225 rose 0.2% and the Dow Jones Europe Stoxx Index fell -2.2%. The Lehman Brothers Aggregate Bond Index ("LBABI") also lost -0.8%.

Greenwich-VAN Advisors, LLC ("VAN") is a global hedge fund index provider that gathers information on hedge funds worldwide. VAN bases its work on its pioneering research on hedge funds begun in the early 1990s and by drawing on one of the world's largest hedge fund databases.

The Index represents the average return of hedge funds tracked by VAN and serves as one of the hedge fund industry's longest-running benchmarks of overall performance.

Final October returns for the Van Hedge Fund Indices will be calculated at the end of November, after additional funds have submitted their returns to VAN. Those results take the place of the returns reported herein. Final October returns for the Van Global Hedge Fund Indices will be posted at www.vanhedge.com when they become available.

VAN's hedge fund index information is a compilation of information received (and not audited or independently verified) from the hedge funds in VAN's databases and may not be representative of all hedge funds. VAN provides no warranties as to the accuracy of the underlying information as reported by the managers, nor does VAN perform due diligence on all such reporting managers. Hedge fund returns are net of fees and performance allocations. The timing of the deduction of such fees and performance allocations may affect the reported performance. The October Van Global Hedge Fund Indices as reported herein were created using a sample of 867 funds. Different statistics may be based on different numbers of funds. Averages are equal-weighted. Past results are not indicative of future performance. Please see www.vanhedge.com/pdf/vanindex.pdf for more information regarding the Van Global Hedge Fund Indices.