SINOPIA Asset Management Guaranteed and Structured Products Conference in Instanbul

SINOPIAAsset Management

Guaranteed and Structured Products

Conference in InstanbulFrançois-Xavier Colas,Fund Manager, Guaranteed & Structured Products

26 janvier 200March 2008

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Non contractual document

Headquartered in Paris with international subsidiaries in London and Hong Kong

Over EUR 31.5 billion* assets under management at end December 2007 EUR 5.1 billion* in guaranteed and structured products for intermediaries and

institutional investors

Sinopia has over 16 years’ experience in managing capital guaranteed funds

* As of 31 December 2007

SINOPIA Asset Management

Assets Under Management by investment type *

Assets Under Management by client type **

Guaranteed & structuredproducts 16.1%

Absolute Return 27.0%Equities

42.3%

Fixed Income 14.6%

Intermediaries 49% Institutional 51%

Company overview

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Structured investment strategies: Closed-end structured

products

Active guaranteed strategies: Immediate protection Forward guarantee

Two management techniques

Guaranteed and structured productsTwo management techniques

Designed to generate performance within strict risk limits imposed by the constraints of the funds to honour the guarantees

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The product return is the result of a chosen formula at launch: replication of the "ZC+option" structure

fixed investment strategy fixed investment horizon

the higher the rates, the smaller the value of the zero coupon, allowing to benefit from a larger payoff on the option side

The fund is customised to the client’s market anticipations and constraints with a choice of:

underlying assets (indices, interest rates, currencies, funds, etc) maturity level of risk strategies (long / short / relative value / volatility)

Closed-end structured productsA formula defined at launch

Option

Replication of a Zero Coupon

At maturity the replication of

the zero coupon returns 100% of

initial investment

Final payoff of the predefined

formula

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Active guaranteed strategiesImmediate protection

A traditional active fund with a capital guarantee: protection on X% of the NAV available immediately for a predetermined period of

time protections of the fund benefit every shareholder regardless of date of entry unlimited upside potential with an actively managed exposure

The fund can be customised: choice of the level of protection choice of underlying assets

Unlimited subscription period, daily liquidity, no penalty charge for subscriptions and redemptions

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Protections* are issued on 90% of the last NAV of each quarter

Protections are effective immediately and valid for one year

Actively managed fund invested in Turkish equity markets (ISE 30 index) and money market securities

Denominated in Turkish lira

Daily liquidity

No penalty charge for redemptions / subscriptions

Unlimited subscription period

Main characteristics of HSBC YATIRIM MENKUL DEGERLER A.S. B TIPI AKTIF YÖNETIMLI KORUMA AMACLI FON

Turkish Equity Protected Strategy

* The protections constitute management objectives and, in no event, can be considered as a formal commitment

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Immediate protectionActive strategy with a shock-absorber

The net asset values used are given only for illustrative purposes and represent only a simulation of the fund's behaviour. *90% immediate, valid for 1 year, data as of 29 February 2008.

CLIC ACTION EQUILIBRE: Performance since inception (base 100 on 18/10/99)

Index : MSCI EMU in Euro (base 100 on 18/10/99)

50

60

70

80

90

100

110

120

130

140

150

10/1999 05/2001 01/2003 08/2004 03/2006 10/2007

MSCI EMU in Eur

CLIC ACTION EQUILIBRE

Protection*

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Example: HSBC YATIRIM MENKUL DEGERLER A.S. B TIPI AKTIF YÖNETIMLI KORUMA AMACLI FON

Protection mechanism

The net asset values used are given only for illustrative purposes and represent only a simulation of the fund's behaviour

90

100

110

T

Fund value

Protection

Protection available from day one: valid over a 1 year period. The fund's net asset value will remain equal or above the protection level.

100

90

Active protection

T+1 year

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Protection upgraded when the net asset value is up



90

100

110 Fund value increase

New protection

T T+3 months

Both the new and the existing subscribers benefit from the new protection coming into force. In case of a rise in the fund’s NAV, previous protection levels will be upgraded for existing subscribers.

Active protection100

90

105

94.5

T+15 monthsT+12 months

Inactive protection

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Protection maintained in case of a net asset value fall



90

100

110

TT+3 months

T+6 months

In the case that the fund’s NAV goes down, new and existing subscribers will benefit from the older but higher protection level.

Active protection100

90

105

94.5

102

91.8

T+18 months

T+15 months

T+12 months

Inactive protection

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The lowest protection levels are not taken into account



90

100

110

T T+6 monthsT+9 months

If the fund’s NAV bounces back after a fall, the protection issued on the lower NAV will remain inactive: higher protection will prevail over lower protections.

100

90

105

94.5

102

91.8

108

97.2

T+3 months

Active protectionInactive protection

T+15 months T+21 months

T+18 monthsT+12 months

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A dynamic portfolio management to maximise performance while maintaining the guarantees:

total exposure to risky assets is monitored on a daily basis to ensure the guarantees are maintained

Depending on its guarantee features, each product has its own risk budget we actively manage:

the lowest the level of the guarantee, the highest the exposure can be

Active management

Active guaranteed strategies

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Active guaranteed strategiesThe variables

Floor value: minimum value of the portfolio to ensure the guarantee

Risk budget: portfolio market value minus floor value

Exposure: amount invested in risky assets

Maximum exposure = multiplier × risk budget the multiplier depends on the level of risk of the considered market: the greater the

risk, the smaller the multiplier

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A theoretical example

Fixed multiplier = 4

110.00

104.00

44.00

60.00

Level of the index

Fund’s NAV

Risky asset

Monetary asset

Floor

Risk budget

Maximum exposure

T0

100.00

100.00

40.00

60.00

90.00

10.00

40.00

T1

110.00

104.00

56.00

48.00

90.00

14.00

56.00

+ 10%

Market

variation Adjustments


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Active and flexible management depending on market anticipations: no systematic management

Total customization of the funds with a choice of underlying assets: equity markets: global, regional, emerging, etc. fixed income alternative strategies: single or multi-driver commodities

Enhanced active management strategies with a variable multiplier which depends on: market expected return anticipated short term volatility

Key features


Appendix

Sinopia’s product offering:

examples of closed-end structured products

examples of immediate protection products

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Sinopia’s product offering: examples of closed-end structured products

Guaranteed and structured products

FUND’S NAME AUM Underlying assets Distribution

HSBC Croissance Euro avril 2008 95* EUROSTOXX 50 France

HSBC Croissance Euro septembre 2008 244* EUROSTOXX 50France

HSBC Objectif 3-6-8 87*EUROSTOXX 50 / Hang

SengFrance

HSBC Trajectoire 5-2 71*EUROSTOXX 50 / S&P

BRIC 40 USDFrance

HSBC Asian All Smiles Capital Guaranteed

Fund190**

HANG SENG / MSCI TAIWAN / KOSPI / FTSE

XINHUA

Hong Kong

* Assets under management in EUR millions, as of 14 March 2008. ** Assets under management in USD millions, as of 29 February 2008.

Sinopia manages approximately EUR 2.56 billion in closed-end structured products

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Sinopia’s product offering: examples of immediate protection products

Guaranteed and structured products

FUND’S NAMEAUM*

(EUR millions)Level of

protection**Frequency Validity Distribution

Novellus Lombard Capital Protection Strategy

353 85% Quarterly 1 year Benelux

CLIC Action Sérénité 60 95%Quarterly 1 year

France

CLIC Action Equilibre65 90%

Quarterly 1 yearFrance

CLIC Action Dynamique65 85%

Quarterly 1 yearFrance

* Assets under management, as of 14 March 2008 ** Best effort protection

Sinopia manages approximately EUR 0.95 billion in immediate protection products

This presentation is produced and distributed by HSBC Investments (France) and is only intended for professional investors as defined by MiFID. It is incomplete without the oral briefing provided by the representatives of HSBC Investments (France) and/or the management company. The information contained herein is subject to change without notice. All non-authorised reproduction or use of this commentary and analysis will be the responsibility of the user and will be likely to lead to legal proceedings.

This document has no contractual value and is not by any means intended as a solicitation, nor a recommendation for the purchase or sale of any financial instrument in any jurisdiction in which such an offer is not lawful. The commentary and analysis presented in this document reflect the opinion of Sinopia Asset Management on the markets, according to the information available to date. They do not constitute any kind of commitment from Sinopia Asset Management. Consequently, neither Sinopia Asset Management nor HSBC Investments (France) will be held responsible for any investment or disinvestment decision taken on the basis of the commentary and/or analysis in this document. All data from Sinopia Asset Management unless otherwise specified. Any third party information has been obtained from sources we believe to be reliable, but which we have not independently verified. The funds presented in this document may not be registered and/or authorised for sale in your country. Past performance is not a guide to future performance. Capital is not guaranteed. Simulated performance is not guide to future performance. Please note that according to article 314-13, performance for periods of less than 12 months cannot be shown to non-professional investors, as defined by MiFID. HSBC Investments represents Sinopia throughout the world; it is responsible for the business relationship and provides client services both in France and abroad, as part of a strategic partnership.

This presentation is not intended for general distribution, it is provided on specific request. Transactions in derivatives are likely to make considerable profits, but they also entail substantial risks. An investment in the SINOPIA Alternative Funds (SAF) should be considered in the light of the financial condition of the investor. Since an investment in such a Fund represents an above average risk, the Fund in question is only suitable for those persons who can afford to take such risks; it is advisable for sophisticated investors to invest therein only a part of the sums such investor intends for a long-term investment.

The term Sinopia Asset Management ("Sinopia") refers to a business engaged in fund management activities, which are ultimately owned by HSBC Holdings plc. Sinopia's registered office is in Paris, Immeuble Ile de France - 4 place de la Pyramide - La Défense 9 - 92800 Puteaux - France, and has subsidiaries in London and Hong Kong (Sinopia Asset Management UK Limited and Sinopia Asset Management Asia Pacific Limited).Portfolio management company - 379 837 800 RCS Nanterre - AMF authorisation no. GP97142.

All subscriptions in any fund presented in this document are accepted only on the basis of the current prospectus, available on request from HSBC Investments (France), the centralisation agent, the financial department or the usual representative. Before subscription, investors should refer to the prospectus for more detailed information on the risks associated with this fund.

HSBC Investments (France) - 421 345 489 RCS Nanterre. Portfolio management company authorised by the French regulatory authority AMF (no. GP99026). Postal address: 75419 Paris cedex 08.Offices: Immeuble Ile de France - 4 place de la Pyramide - La Défense 9 - 92800 Puteaux – France.

www.hsbcinvestments.fr

Non contractual document, updated in March 2008.

Disclaimer19

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SINOPIA Asset Management Guaranteed and Structured Products Conference in Instanbul