Qualified Eligible Person (QEP) 
 

An investment with Potomac Advisors Inc ("POTOMAC"), managers of The Endeavor Fund  ("ENDEAVOR") is highly speculative and involves a substantial degree of risk. Our trading programs are designed for sophisticated investors who are able to bear the loss of their entire investment.  

In that vein POTOMAC has filed a "NOTICE OF CLAIM PURSUANT TO COMMODITY FUTURES TRADING COMMISSION RULE 4.7(c) UNDER THE COMMODITY EXCHANGE ACT, AS AMENDED ("ACT") which restricts solicitations to someone who is a QEP (Qualified Eligible Person) as defined by the ACT.  

Please review the list below to see if you may be considered a QEP. 
 
 

1  FCM  
 
2  Broker / Dealer  

3  CPO which has been registered and active for 2 years or has >$5M in assets  

4  CTA which has been registered and active for 2 years or has > $5M in assets  

5  Investment adviser which has been registered and active for 2 years or has > $5M in assets  

6  Qualified Purchaser  

7  Knowledgeable Employee  

8  CPO, CTA, IA for the exempt pool or account (see note below)   

9  Principal of CPO, CTA, IA for the exempt pool or account (see note below)  

10  Employee of CPO, CTA, IA for the exempt pool or account involved in investment activities for 1 year (see note below)  

11  Employee or agent of CPO, CTA, IA for the exempt pool or account involved in legal, accounting, auditing or financial services activities for 2 years and is an accredited investor (see note below)  

12  Trust not formed to invest in exempt pool or account with trustee being a QEP  

13  Organization described in Sec. 501 (c)(3) of the Internal Revenue Code with trustee being a QEP  

14  Non-U.S. person or entity  

15  An entity in which all participants are from any of the above groups  

16  4.5 entity with all QEP investors  

17  Registered investment company  

18  Bank  

19  Insurance company  

20  Plan, with > $5M in assets, for employees of a state or political subdivision  

21  Employee benefit plan with > $5M  

22  Private business development company  

23  Organization described in Sec. 501 (c)(3) of the Internal Revenue Code with > $5M in assets  

24  Corporation, trust, partnership with > $5M not formed to invest in exempt pool  

25  Person with net worth >$1M  

26  Person with net income > $200,000 each of the last 2 years or > $300,000 when combined with spouse  

27  Pool, trust separate account, collective trust with > $5M in assets  

28  Certain governmental entities 

Note: May also include spouse, child, sibling or parent if investment is made with knowledge and direction or a company, estate or any person acquiring participation by gift, bequest, separation or divorce from one of these persons.  
 
Summary Investment Risk Disclosure

THE RISK OF LOSS IN TRADING COMMODITIES CAN BE SUBSTANTIAL. YOU SHOULD, THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. IN CONSIDERING WHETHER TO TRADE OR TO AUTHORIZE SOMEONE ELSE TO TRADE FOR YOU, YOU SHOULD BE AWARE OF THE FOLLOWING: 

IF YOU PURCHASE A COMMODITY OPTION, YOU MAY SUSTAIN A TOTAL LOSS OF THE PREMIUM AND OF ALL TRANSACTION COSTS. 

IF YOU PURCHASE OR SELL A COMMODITY FUTURE OR SELL A COMMODITY OPTION, YOU MAY SUSTAIN A TOTAL LOSS OF THE INITIAL MARGIN FUNDS AND ANY ADDITIONAL FUNDS THAT YOU DEPOSIT WITH YOUR BROKER TO ESTABLISH OR MAINTAIN YOUR POSITION. IF THE MARKET MOVES AGAINST YOUR POSITION, YOU MAY BE CALLED UPON BY YOUR BROKER TO DEPOSIT A SUBSTANTIAL AMOUNT OF ADDITIONAL MARGIN FUNDS, ON SHORT NOTICE, IN ORDER TO MAINTAIN YOUR POSITION. IF YOU DO NOT PROVIDE THE REQUIRED FUNDS WITHIN THE PRESCRIBED TIME, YOUR POSITION MAY BE LIQUIDATED AT A LOSS, AND YOU WILL BE LIABLE FOR ANY RESULTING DEFICIT IN YOUR ACCOUNT. 

UNDER CERTAIN MARKET CONDITIONS, YOU MAY FIND IT DIFFICULT OR IMPOSSIBLE TO LIQUIDATE A POSITION. THIS CAN OCCUR, FOR EXAMPLE, WHEN THE MARKET MAKES A "LIMIT MOVE". 

THE PLACEMENT OF CONTINGENT ORDERS BY YOU OR YOUR TRADING ADVISOR, SUCH AS A "STOP-LOSS" OR "STOP-LIMIT" ORDER, WILL NOT NECESSARILY LIMIT YOUR LOSSES TO THE INTENDED AMOUNTS, SINCE MARKET CONDITIONS MAY MAKE IT IMPOSSIBLE TO EXECUTE SUCH ORDERS. 

A "SPREAD" POSITION MAY NOT BE LESS RISKY THAN A SIMPLE "LONG" OR "SHORT" POSITION. THE HIGH DEGREE OF LEVERAGE THAT IS OFTEN OBTAINABLE IN COMMODITY TRADING CAN WORK AGAINST YOU AS WELL AS FOR YOU. THE USE OF LEVERAGE CAN LEAD TO LARGE LOSSES AS WELL AS GAINS. 

IN SOME CASES, MANAGED COMMODITY ACCOUNTS ARE SUBJECT TO SUBSTANTIAL CHARGES FOR MANAGEMENT AND ADVISORY FEES. IT MAY BE NECESSARY FOR THOSE ACCOUNTS THAT ARE SUBJECT TO THESE CHARGES TO MAKE SUBSTANTIAL TRADING PROFITS TO AVOID DEPLETION OR EXHAUSTION OF THEIR ASSETS. BEFORE INVESTING YOU SHOULD BE AWARE OF ALL CHARGES AND HAVE A COMPLETE DESCRIPTION OF EACH FEE TO BE CHARGED TO YOUR ACCOUNT BY THE COMMODITY TRADING ADVISOR. 

THIS BRIEF STATEMENT CANNOT DISCLOSE ALL THE RISKS AND OTHER SIGNIFICANT ASPECTS OF THE COMMODITY MARKETS.  

YOU SHOULD ALSO BE AWARE THAT THIS COMMODITY TRADING ADVISOR MAY ENGAGE IN TRADING FOREIGN FUTURES OR OPTIONS CONTRACTS. TRANSACTIONS ON MARKETS LOCATED OUTSIDE THE UNITED STATES, INCLUDING MARKETS FORMALLY LINKED TO UNITED STATES MARKETS, MAY BE SUBJECT TO REGULATIONS WHICH OFFER DIFFERENT OR DIMINISHED PROTECTION. FURTHER, UNITED STATES REGULATORY AUTHORITIES MAY BE UNABLE TO COMPEL THE ENFORCEMENT OF THE RULES OF REGULATORY AUTHORITIES OR MARKETS IN NON-UNITED STATES JURISDICTIONS WHERE YOUR TRANSACTIONS MAY BE EFFECTED. BEFORE YOU TRADE YOU SHOULD INQUIRE ABOUT ANY RULES RELEVANT TO YOUR PARTICULAR CONTEMPLATED TRANSACTIONS AND ASK THE FIRM WITH WHICH YOU INTEND TO TRADE FOR DETAILS ABOUT THE TYPES OF REDRESS AVAILABLE IN BOTH YOUR LOCAL AND OTHER RELEVANT JURISDICTIONS.  

THIS COMMODITY TRADING ADVISOR IS PROHIBITED BY LAW FROM ACCEPTING FUNDS IN THE TRADING ADVISOR'S NAME FROM A CLIENT FOR TRADING COMMODITY INTERESTS. YOU MUST PLACE ALL FUNDS FOR TRADING IN THIS TRADING PROGRAM DIRECTLY WITH A FUTURES COMMISSION MERCHANT.