IMPORTANT WARNING

Trading futures, equities, and digital assets involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is appropriate for your financial situation. The risk of loss in trading can be substantial and you may lose more than your initial investment.

General Investment Risks

Market Risk

The value of investments can go down as well as up and you may not get back the amount you invested. Market conditions, economic factors, and geopolitical events can all impact the performance of the fund's underlying positions.

Leverage Risk

Futures trading involves leverage, which can amplify both gains and losses. While the fund employs systematic risk management, leveraged positions can result in rapid and substantial losses during adverse market movements.

Past Performance

Past performance is not indicative of future results. Historical returns, including the stated 2.98% monthly average and 7-year track record, do not guarantee future performance. Market conditions change and future returns may differ significantly from historical performance.

Specific Risk Factors

Futures Trading Risks

High volatility in futures markets can result in significant price movements
Leverage magnifies both potential returns and potential losses
Market gaps and slippage can occur, particularly during high volatility periods
Margin calls may be issued requiring additional capital
Counterparty risk exists with clearing brokers and exchanges

Digital Asset Risks

Cryptocurrency and digital asset markets are highly volatile and speculative
Regulatory uncertainty may impact digital asset valuations and accessibility
Technology risks including cybersecurity threats and platform failures
Limited regulatory protection compared to traditional financial markets
Liquidity constraints during market stress periods

Systematic Strategy Risks

Algorithmic and systematic strategies may not adapt quickly to unprecedented market conditions
Model risk: trading algorithms may contain errors or become ineffective
Technology failures could interrupt trading operations
Market regime changes may reduce strategy effectiveness
Execution risk due to technology latency or broker issues

Liquidity Risk

While the fund allows monthly profit withdrawals and capital redemptions with 30-day notice, there may be circumstances where redemptions are delayed or suspended. This could occur during periods of market stress, operational issues, or to protect the interests of remaining investors.

Concentration Risk

The fund focuses primarily on NQ and ES futures (approximately 70% of allocations), which creates concentration risk. Poor performance in these specific instruments could significantly impact overall fund returns.

Regulatory and Operational Risks

Regulatory Status

Fluid Finance is currently pursuing FCA authorization as an Alternative Investment Fund Manager. While the authorization process is underway, the firm operates within applicable regulatory frameworks. Changes in regulations or authorization delays could impact fund operations.

Operational Risk

The fund faces operational risks including technology failures, human error, fraud, and external events beyond management's control. While comprehensive controls and procedures are in place, no system can eliminate all operational risks.

Key Person Risk

The fund's performance is heavily dependent on the expertise and continued involvement of founder Felix Jones. Loss of key personnel could materially impact fund operations and performance.

Important Considerations

Suitability

This investment is only suitable for sophisticated investors who:

Understand the risks of leveraged trading and alternative investments
Can afford to lose their entire investment without impacting their financial situation
Have adequate financial resources and risk tolerance
Do not require immediate liquidity
Have received independent financial and tax advice

No Guarantee of Returns

The fund operates with monthly "target returns" of 3.8% (Class A) and 4.5% (Class B). These are targets only and are not guarantees. Actual returns may be significantly lower or negative. The historical average of 2.98% monthly returns does not constitute a promise or projection of future performance.

Loss of Capital

There is a risk of substantial or total loss of your investment. You should only invest capital that you can afford to lose completely without impacting your standard of living or financial obligations.

Risk Mitigation Measures

While no investment is without risk, Fluid Finance employs several risk management measures:

Hard-coded maximum drawdown limits on all trading strategies
Diversification across multiple asset classes and instruments
Institutional-grade broker custody and segregated client accounts
Systematic execution removing emotional decision-making
Continuous monitoring and real-time risk controls
Regular independent auditing and compliance oversight

However, these measures cannot eliminate all risks and losses may still occur.

Acknowledgment Required

All prospective investors must acknowledge that they have read, understood, and accepted this Risk Disclosure as part of the subscription process. We strongly recommend seeking independent financial and legal advice before investing.

Last updated: December 2024

Risk Disclosure