Alternative Investment Strategies Limited

(the "Company")

Interim Management Statement

This interim management statement relates to the period from 1 November 2009 to the date of publication of this statement and has been prepared solely to provide additional information in order to meet the relevant requirement of the UK Listing Authority's Disclosure and Transparency Rules, and should not be relied on by Shareholders, or any other party, for any other purpose.  

Investment objective

The Company invests in a diversified portfolio of hedge funds on a worldwide basis with the aim of achieving superior absolute returns with low volatility.

Financial position and performance

In the period from 1 November 2009 to 5 March 2010 (the date of the latest available estimated weekly net asset value), the Company's net asset value increased by 1.47% to 126.02 pence. As at 18 March 2010, the shares were trading at a 12.9% discount to net asset value.

The net asset value performance since inception in December 1996 to 5 March 2010 is 145.92%, equivalent to an annualised rate of 7.02%.

Investment Manager's review

The investment manager's review covers the period from 1 November 2009 to 28 February 2010. After the strong recovery in equity and credit markets during 2009, market conditions were less settled during the period under review. Investors became more concerned about rising sovereign risks, the prospects for tightening monetary policy and the sustainability of economic recovery in many developed countries. In this environment, the investment manager has continued to particularly focus on managers that have strong fundamental, analytical and security selection skills in the equity and credit markets. In addition, the Company has maintained a significant exposure to trading-orientated managers in the fixed income markets. The highest allocations of the Company were to the Long/Short Equity and Macro strategies at the period end.

During this period, the largest contributions to returns have been from the Long/Short Equity, Macro, Fixed Income Relative Value and Credit strategies which have also been the strategies where the investment manager has had a positive return outlook. The highest contribution to gains was produced by the Long/Short Equity managers. The Company has favoured managers with a variable bias and those with a market neutral approach within the strategy. Both these types of manager performed well over this period and exposure was increased to two of our highest conviction managers and one additional market neutral manager was purchased. The background to markets also continued to provide a constructive opportunity set for Macro managers. Managers with a diversity of approaches and those with a bias towards fixed income markets have been favoured. Managers within the Macro and Fixed Income Relative Value strategies also produced a meaningful contribution to performance. However, the exposure to the Event Driven and Trend Followers/CTAs strategies produced some small negative contributions to returns. In particular, reversals and counter reversals in the recent trends of most of the underlying asset classes proved challenging for our Trend Followers/CTAs managers.

The investment manager is currently most positive on the return outlook for the Long/Short Equity, Macro and Credit strategies and the Company continues to maintain significant exposure to these areas. Stock picking is expected to be better rewarded in 2010 for hedge fund managers focused on the equity and credit markets and managers that have a flexible approach are expected to have many opportunities to take advantage of in the fixed income markets.

Strategy Allocation

The strategy allocation as at 28 February 2010 was as follows:

Source of data: International Asset Management Limited

Top ten holdings

By reference to the most recent portfolio valuation of the Company as at 28 February 2010, the largest ten investments held by the Company were as follows:

Source of data: International Asset Management Limited  

Continuation vote

At the Annual General Meeting of the Company held on 24 February 2010, Shareholders approved the continuation of the Company as an investment company.

Share Buy Backs

The Company has purchased 3,975,000 of its own shares in the period from 1 November 2009 to the date of this statement. In aggregate, 4,400,000 shares are currently held in Treasury.

Other than described above, the Board is not aware of any material events during the period from 1 November 2009 to the date of this announcement, which would have had a material impact on the financial position of the Company.

Investor Information

The latest available information on the Company can be accessed via www.aisinvest.com.

By order of the Board

Alternative Investment Strategies Limited

Enquiries:

Sean Molony                                                                                        Tel: 020 7734 8488

International Asset Management Limited