Ann: Interim Earnings Update , page-6

I listened to the CIO of one of the largest investment firms in the world speak yesterday. During his discussion he was talking about breakouts. This was not a discussion of breakouts from a technical analysis standpoint but rather as it applies to paradigm shifts in companies and geo-political situations. He compared a breakout to building a sand castle with your kid on the beach. You can build the perfect sand castle, but ultimately it reaches full capacity and all it takes is one tiny pebble of sand to shift the entire complexity of the sand castle, the sand castle can change shape and become bigger or the sand castle can crumble, either way all it takes is one pebble of sand. In the case of HFA, I would say the sand castle is reaching full capacity and sooner or latter a tiny pebble of sand will create an amazing shift, breakout, paradigm shift, whatever you would like to call it to the upside.

I have never followed a company for so long that have so many things stacking up in their favor:

1) LHP was early to the managed account game
2) The company survived 2008
3) The company has returned to profitabilty
4) A very solid strategic partner is now in the mix
5) Debt will be paid down

A dividend, increased AUM (from a stable asset base btw as Apollo's customers are all pensions and institutions), positive performace or a combination of all should move this up. In addition once this transaction is done, there is not going to be a huge float out there, if one or two more institutions get interested, this will get really interesting really fast.