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COLUMBUS, Ohio (October 1, 2004) - For the US equity markets, the 3rd Quarter represented the worst performing quarter for the Dow since 1Q, '03 and for the NASDAQ since 3Q, '02. The S&P 500 Index fared only marginally better, losing (1.9)% for the 3-month period. Prospero's long investments were in line with the S&P 500 for the quarter, also declining (1.9)% on a net basis. Prospero's hedged investments performed better during the quarter, with our market-neutral Curan Fund appreciating by a net 1.3% and our long/short Beaumont Fund declining by a net (1.1)%.
Although 2004 has been a particularly difficult year for equities, due in large part to extreme positive correlations among securities and across sectors, Prospero's core equity strategy (Antenor) has produced positive returns in the trailing 1-year, 3-year, 5-year, and since inception periods (1/1/97), while the S&P 500 has declined by a cumulative (6.4)% during the past 5 years. Furthermore, during the last five years, Prospero has outperformed the S&P 500 by 10.3% ANNUALLY net of all fees, exceeding our goal of 7.0% per annum outperformance of the S&P 500.
Annualized net returns (-9/30/04):
| Antenor | S&P 500 | |
| Sept '04 | 0.8% | 1.1% |
| YTD | (2.4%) | 1.5% |
| 1-year | 5.7% | 13.8% |
| 3-year | 9.1% | 4.0% |
| 5-year | 9.0% | (1.3)% |
| Inception (1997) | 12.8% | 7.0% |
Given Prospero's consistently strong track record, please consider the following facts when evaluating your current portfolio allocation:
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Prospero has produced positive double-digit net annual returns of 13% for its
investors since inception in 1997
- Every $1 million invested in Prospero's core equity fund 5 years ago placed an investor more than $604,000 ahead of the S&P's return, itself a level exceeding the performance of many fund managers.
If you would like to discuss Prospero in more depth or further explore our investment process, please call us toll-free at 866.377.7677. During the second half of 2004 and beyond, we will be working diligently to bring performance back to levels consistent with Prospero's historic standards. As always, we thank you for and value your loyal support.
Prospero Capital Management is an investment advisory company delivering superior financial results and service to clients through detailed fundamental research and investment insight. Contact Prospero at 866.377.7677 or invest@prosperofunds.com for more information.