1. Commentary

November continued the strong run for Zone Capital with all accounts posting gains of around 7% or more after fees. This makes the third month in a row of strong returns and puts the cumulative return for the most recent 3 months at 21% post fees, a result that we are satisfied with especially given the 8 month flat period we have endured.

It is worthy of note that flat periods of trading followed by strong, exponential runs up in capital is quite characteristic of Zone Capital's trading style and risk management. Looking back at the equity curve of our Track Record there are a number of these cycles. Naturally we acknowledge that it would be better not to have the flat periods, however we believe that any manager that is seeking significantly superior returns must exchange pure consistency, particularly daily volatility, for such returns. We interpret these flat spots as a very positive sign that risk and therefore losses are well contained when our systems our underperforming.

As with previous cycles of strong performance, the last three months gives renewed evidence that our trading is specifically designed to make the most of the times when our systems are in favour with the market.

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

Results presented are after fees

2. Fund Performance

	Nov 07	Oct 07
% Return	6.7%	4.5%

3. Track Record* Update

Cumulative Performance

Summary Performance Statistics

	Since Jan 04
Cumulative % return	717%
Annualised % return	71%
Maximum Drawdown	18.7%
Sharpe Ratio	1.7
Sortino Ratio	6.2

*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