Final NAV 28Feb2007

RNS Number:9660T
Dexion Trading Limited
29 March 2007



Dexion Trading Limited ("the Company")

February Net Asset Value

The net asset value per # share as of 28 February 2007 was 109.63 pence.

This valuation, which has been prepared in good faith by the Company's
investment manager, is based principally on formal valuations supplied to the
Company by the administrators of the Company's underlying investments.  In the
case of 4 of the Company's 22 investments, where no such formal valuation has
been received by today's date, an estimated valuation prepared by the Company's
investment advisor or by the manager or administrator of the underlying funds
has been used. Such valuations or estimates are unaudited and may not comply
with generally accepted accounting or valuation principles.

Manager's Report

Performance Review

Dexion Trading returned -0.38% in February (ytd +0.83%).


February looked set to be a somewhat benign month for global markets; however,
the risk-seeking mood ended abruptly on the penultimate day of the month. A
combination of factors, including a sell-off in Chinese A shares and concerns
over US sub-prime mortgages, resulted in the biggest one-day fall in US equities
since the last bear market. The substantial sell-off in US sub-prime mortgages
was only weakly mirrored in emerging market spreads despite concerns over
manipulation of Argentinean inflation statistics, the prospect of default in
Ecuador and a continuing program of expropriation of assets belonging to foreign
resource companies in Bolivia.  Equity markets, for the most part, gave up their
gains for the year as the prospects for global growth diminished and investors
feared a collapse in US consumer demand. Japanese equities delivered one of the
few positive performances for equities globally despite a sharp rally in the Yen
against the US Dollar as risk aversion resulted in some unwinding of carry
trades. In bond markets, both US and European markets rallied in the 2-10 year
segment of the curve as growth expectations dwindled. The Japanese curve
flattened as 2-year rates sold down by 13bp in reaction to a 0.25% hike in
rates, which had been deferred from January.



The portfolio held up relatively well against this backdrop with the small
negative return for the month masking a great deal of dispersion in the
performance of individual funds and across different sectors. Systematic (-93bp
of gross contribution) managers had a mixed month with Long-term Systematic
traders posting negative performance and Short-term Systematic managers ending
the month positively even with the end of month volatility. Discretionary
(+17bp) and RV Macro (+19bp) managers also closed the month in positive
territory. There has been a  consensus amongst Discretionary traders since last
summer that the markets were due to suffer increased volatility, though there
was disagreement as to whether this would take the form of a technical
correction or a more sustained re-pricing of risk. Consequently, portfolio risk
levels were relatively low in February compared to May and June 2006. Managers
had focused on their highest conviction fundamentally based trades and when the
sell-off came, they were quick to reduce risk and careful about re-entering the
market. As a result, they only gave back a small proportion of their month to
date gains. The most profitable trades were long G3 fixed income (some managers
managed to benefit from the flight to quality) and long selective emerging
market fixed income and FX, in particular Brazilian, Turkish and Hungarian debt.
Although the Yen carry trade was much hyped by the financial press, there was
little evidence of it amongst our Discretionary managers. Other managers
suffered losses from short fixed income positions and a smaller number lost
money by being long equity indices. On the Systematic side, Long-term Systematic
managers suffered, the very nature of their trading meant that they were
unaffected by cautious sentiment among market participants and in fact, after
four months of strong performance, they came into the month with relatively high
levels of risk across their portfolios. When the sell-off occurred, the speed of
the move gave little chance for their models to react. This, coupled with
correlation between markets, negated any diversification benefits in their
portfolios which accentuated losses. The main negatives came from long equity
indices, short the Yen and short-dated fixed income instruments. Short-term
Systematic managers, however, performed very strongly, benefiting from strong
trends both intra-day and over two to three day horizons. The Relative Value
sector (+20bp) also contributed strongly to the returns of the portfolio, with
our European-focused Event Arbitrage managers once again posting positive
performance as the board of Endesa finally agreed to recommend acceptance of the
EON bid, after a long and bitter struggle, only to see Enel attempt to place a
blocking bid.


Strategy                                 Allocation as   Number of    Performance by 
                                          of 1 March   Funds as of 1    Strategy
                                               %          March             %
                                                
                                                                      February    YTD
Directional - Discretionary and RV Macro       44           9         0.86       1.65
Directional - Systematic Trading               36           9        -2.50       0.13
Multi-Process                                  10           3         1.17       1.87
Relative Value Arbitrage                       10           2         1.97       4.09
Total                                          100         23



Strategy returns are in US$ and net of underlying manager fees only, and not
inclusive of Dexion Trading's fees and expenses.



Outlook



Irrespective of the rapid risk reduction, the Long-term Systematic traders
continued to suffer losses coming into March as the market turmoil persisted.
Losses have been concentrated in the same trades as February, though the signals
generated by models have led to some funds switching their positions. Among the
Discretionary traders, managers remain cautious and most are watching to see how
these markets develop. Risk levels remain low and this is expected to remain the
case for the rest of the month.



Investment Policy



The Company's investment policy is to invest in an actively managed portfolio of
hedge funds which is diversified by investment strategy, style and manager. The
Company does not invest in other UK listed investment companies (including UK
listed investment trusts).



Voting Rights and Capital



The Company's capital consists of 83,000,000 ordinary shares with voting rights.
Therefore, the total number of voting rights in the Company is 83,000,000.



The above figure (83,000,000) may be used by shareholders as the denominator for
the calculations by which they will determine if they are required to notify
their interest in, or a change to their interest in the Company under the FSA's
Disclosure and Transparency Rules.


                      This information is provided by RNS
            The company news service from the London Stock Exchange
END

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