TETRAD INVESTMENT PRODUCTS Overview Tetrad Securities Limited was founded in 1995 as a discount house.

In 2009, it was granted a merchant banking license and was renamed Tetrad Investment Bank. The holding company is Tetrad Holdings which owns the following subsidiary companies: Tetrad Investment Bank TFS Management Company Multiridge Finance Tetrad Hail Insurance Tetrad Properties Tetrads main thrust is the provision of a wide variety of investment products covering both the stock and money markets. Recently the Group, through its asset management firm, introduced a Gold indexed unit trust fund which is a new and unique product on the local market. Currently, Tetrad Holdings has two companies which provide investment products namely, Tetrad Investment Bank which offers treasury, corporate banking, international banking as well as structured finance products and TFS Management Company which specializes in portfolio management, unit trust management as well as investment advisory services. TETRAD TREASURY MONEY MARKET Our treasury is a participant on the wholesale and money market participants and offers investment opportunities for our clients. The money market is the short term market (not more than a year) which entitles the depositor a fixed interest payment at maturity. Tetrad offers a range of maturity profiles and with rates commonly quoted for the following durations:
Maturity profile 30 days 60 days 90 days 180 days

*Please call our dealers for current indicative rates. We also offer offers call accounts to clients who do not wish to open fixed term deposit accounts. The advantage of this type of account is that, one can access their funds any time

they so wish, without tying up their funds for specific periods of time. However, this account pays less interest when compared to fixed term deposits. Money market investments are ideal for risk averse investors. There is minimal risk to capital and return on the investment is predetermined. In addition, on maturity one has the option to redeem proceeds or roll over the investment, thereby providing flexibility to the investor. TFS MANAGEMENT COMPANY EQUITIES MARKET TFS Management Company is the asset management company of the Tetrad Group. It offers exposure in different asset classes including equities, money market and gold. A synthesis of more than one of the instruments from different markets is also possible to utilize the best chances possible in order to achieve better returns. Under the asset management wing, the following options are available: Managed Account Clients are offered the opportunity to invest directly on the Zimbabwe Stock Exchange in a segregated account. Tetrad consists of highly qualified fund managers whose responsibility is to manage clients accounts. The function of portfolio management is to skillfully select counters to structure a clients portfolio and produce the desired returns taking into account the clients appetite for risk. In addition, if the fund managers decide to hold the funds as cash awaiting the right time to invest in stocks, the idle cash is invested on the money market through our treasury, as money on call, thereby earning interest. With the funds being on call, it is easier to switch from one market to the other. Unit Trusts The unit trust allows the smaller investor to participate on both the equities and money markets. Funds are pooled from different clients and investment in a specific class guided by specific investment. The Tetrad Unit Trust Funds are categorised as follows: Equity Unit Trust Funds Funds are invested in listed stocks trading on the ZSE. Currently there are two equity based unit trusts which are: i. Jupiter Fund the portfolio consists of blue chip counters which are relatively stable. The fund will suit an investor who does not have a high appetite for risk and is more concerned about growth, which will be more achievable over a longer term. ii. Venus Fund - the fund invests in undervalued counters, with upside potential on price correction. It has a higher risk profile but with higher expected returns than in the Jupiter fund.

Money Market Unit Trust Funds The pooled funds are used to invest in money market instruments which earn interest. Interest accrues to the investor on a daily basis with total interest earned being credited to the investor at the end of the month. We operate two money market based funds, the differentiator being that one is taxable while the other is not. Net Income Fund - taxable Gross Income Fund - non-taxable and suited to investors who enjoy tax exempt status These funds are suitable for risk averse investors as they have a minimal risk attachment to them. Hybrid fund Capricorn Fund this is a hybrid fund which consists of investments on the stock market, money market instruments and also direct investments in properties. It gives the investor a diverse opportunity to derive benefits from both the stock market and properties.

Gold Fund The Gold Fund was launched beginning of July 2010. It is the first of its kind in Zimbabwe and Tetrad is currently the sole provider of the product. The Gold Fund is a commodity based unit trust, of which the underlying commodity is gold. The unit price tracks the international gold spot price and moves in response to the changes in this price. A significant portion of the fund is invested in gold with only a small portion invested on the money market. The reason behind incorporating the money market instrument in the gold fund is to cater for client redemptions. However this is maintained at the very lowest possible levels to avoid a dilution effect and creation of a hybrid product. The main advantage of investing in the gold fund is the negative correlation of global economic activity and the international gold price. If the global markets are not doing so well due to economic distress for example, there is a tendency for investors to shift their investments from equities to gold. By end of 2010, global economies were trying to recover from the recent credit crunch and fears of a double dip recession were prominent. For the year 2010, gold had gained 28.8%. Short term forecasts indicate gold will remain firm as no significant turnaround is foreseeable in the global markets. It is important to note that, on a general basis, the price of gold fluctuates. This means that the price can go up or down which represents a gain or loss in that order. It is advisable then that an investor considers this product a long term investments in order to realize the full potential benefits of gold price movements.

Staff Savings Scheme This is a substitute fund for a pension fund. The employee and employer have ownership of the scheme that is invested in equities through a licensed Fund Manager. Although these schemes do not have the tax advantages of a pension fund, the growth in the value of the investment has generally outperformed the pension funds leaving the investor better off. The monthly contributions are used to purchase units in a managed fund or unit trust. The funds are then invested by the Fund Manager in a portfolio of equities quoted on the ZSE together with money market instruments. The portfolio is valued on a daily basis and divided by the number of units in issue to give the price per unit. When the employee leaves the service of the company, he may redeem the units in whole or in part or he may choose to keep them, particularly if they have performed well. In the event the units are to be redeemed, the Fund Manager requires two business days notice of redemption. The income that is earned on the portfolio is distributed half yearly but is re-invested in the Fund by the purchase of more units. Distribution statements are sent out showing the amount and composition of the distribution and the tax that has been deducted. In addition, the unit holders receive periodic statements showing the transactions over the account and the balance held by each unit holder. The employers contribution has tax implications in that it will be deemed by ZIMRA to be a benefit and will attract tax at PAYE rates. The advantage is that the employee is taxed on the cost of the units. When surrendering them, a capital gains tax of 1% of the proceeds will be deducted and this is a final tax. Over a period of time, the realized value should be considerably more than the cost and the taxes paid. All dealings through the Staff Savings Scheme are between a nominated representative of the company and the Fund Manager who will only accept instructions from that nominee and not from any employee direct. Some companies insist that the employees pledge the units to the employer to ensure that the funds cannot be withdrawn without the knowledge of the employer.

Comparison of the performances of our unit trust funds against the industrial index.
Prices in cents as Prices in cents as at 31/12/2009 at 31/12/2010 Change Jupiter 4.24 5.08 19.81% Venus 2.24 3.95 76.34% Capricorn 5.37 6.58 22.53% Gold 100* 110.64 10.64% Annual change in the industrial index for 2010 (0.47%) (0.47%) (0.47%)

*Price as at 1 July 2010

The above statistics shows that all of our funds outperformed the industrial index with gains of between 19% and 76%. This was against a loss of 0.47% recorded in the industrial index for 2010. In addition, the Gold Fund gained 10.24% for the 6 months to 31 December 2010, which is quite phenomenal in this era of US dollars. Through the fund managers expertise, our funds were able to achieve positive returns even when the market closed the year on a negative note.