REFCO's Notes Linked To S&P Hedge Fund Index & Managed Futures Fund

Refco Securities, LLC (RSL) announced that it has begun the sale and distribution of the Refco Diversified Alpha Notes EUR I (the Notes). The 100% principal protected Notes are 10 year, Euro denominated, euro Medium Term Notes guaranteed by the

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Refco Securities, LLC (RSL) announced that it has begun the sale and distribution of the Refco Diversified Alpha Notes – EUR I (the Notes). The 100% principal protected Notes are 10-year, Euro denominated, euro Medium Term Notes guaranteed by the full faith and credit by Socit Gnrale. The performance of the Notes is linked to the S&P Hedge Fund Index and the Refco Advantage Multi Manager Fund – Futures Series I (the Advantage Fund), managed by Refco Alternative Investments, LLC (RAI), a division of REFCO Group Ltd., LLC (REFCO), that develops alternative investment products. Standard & Poor’s is the leading provider of independent investment research, ratings and indices.

The Note is designed to capture upside movements while protecting shareholder value against any drop through a broad allocation to over 50 alternative funds representing 9 different strategies. Up to 50% of the annual positive performance will be locked-in to better ensure investors with continuing positive returns. This profit lock-in feature can substantially increase the amount guaranteed at maturity. Monthly liquidity is offered throughout the life of the Note, with transparent valuations available on the secondary markets and net asset values made available on Reuters, Bloomberg and the Internet.

The Notes will be offered for sale to investors mainly located in Europe and the Middle East. The Notes are not available for sale to investors located in the United States or investors who are U.S. persons under the securities laws of the United States. According to Pierre Maliczak, RAI Head of Europe, the Notes will be sold to investors seeking a well-diversified access to the alternative investments world without being exposed to the risks inherent to direct investments in hedge funds.

“RAI has optimized the allocation between the S&P Hedge Fund Index, whose stable returns provide consistency in the basket, and the Refco Advantage Multi Manager Fund – Futures Series I, a great alpha kicker, to provide investors with the potential for high performance returns while significantly lowering the volatility usually provided in a similar structure,” said Mr. Maliczak.

The S&P Hedge Fund Index offers investors an investable benchmark that is representative of the broad range of major strategies that hedge funds employ. The index has 40 constituents divided into three sub-indices: S&P Arbitrage Index, S&P Event-Driven Index and S&P Directional/Tactical Index, which in turn represent a total of nine specific strategies. These strategies include: Equity Market Neutral, Fixed Income Arbitrage, Convertible Arbitrage, Merger Arbitrage, Distressed, Special Situations, Equity Long/Short, Managed Futures and Macro. The strategies are equally weighted to ensure well-rounded representation of hedge fund investment approaches and to avoid overrepresentation of currently popular strategies.

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