1. Commentary

December ended as an underperforming month as we posted a loss of 0.9% for our track record account. That loss takes our calendar year to a loss of 0.4%, which unfortunately is the first calendar year not in the black. Naturally 2009 is not something we wish to repeat and there is probably ample evidence to suggest it was, indeed, a unique year.

Weathering a drawdown is always challenging and we continue to work at developing more systems that will compensate for the lack of performance of our existing suite in recent times. That said, we also know that the statistical behavior that our existing systems rely upon will be seen again in the markets and are confident that our risk management will ensure that we will be in a good position to capitalize on performance.

We look forward to 2010 being a year where markets return to a more stable footing and in the mean time we will be continuing on our development path.

For more information please visit our website: www.zonecapital.com.au

2. Performance

	Dec 09	Nov 09
% Return	(0.9%)	0.0%

3. Track Record* Update

Cumulative Performance

Summary Performance Statistics

	Since Jan 04
Cumulative % return	842%
Annualised % return	45%
Maximum Drawdown	18.7%
Sharpe Ratio	1.4
Sortino Ratio	5.2

*Track Record, as presented, is based on the trading account of FuturesTech Pty Ltd (an entity wholly owned by Malcolm Morley, a director of Zone Capital) for the period January 2004 – December 2006 and for the Zone Trading Trust 1 thereafter. The returns above are after deducting pro-forma fees, consisting of a 2% pa management fee plus a 25% high water marked performance fee. Zone Capital does not represent in any way that the past performance of the Track Record is any indication of likely future performance.

www.zonecapital.com.au