Fund Objective

To provide long term capital appreciation.

View on Past Performance

October was the month we took significant action to tailor the portfolio for a very uncertain market. The tail of the portfolio was divested and the focus centered on big capitalization, profitable biotechnology investments such as Amgen, Genentech, and Gilead Sciences. Having increased our holding in ImClone earlier in the month, the final bid came through from Lilly and we divested our entire holding. Genentech remains under a bid from Roche.Despite the turmoil in equity markets, it is business as usual in the biotechnology sector; portfolio company Cephalon's drug received FDA approval and we are looking forward to Micromet's data being presented at a major clinical conference in early December.October was a horrible month as rescues in the financial sector and recessionary concerns prompted mass selling of equities, fund redemptions and liquidations. Broad equity indices like the FTSE100 and the S&P500 finished the month down over 11% and 8%, in Sterling terms respectively.The biotech sector's out-performance was also due to excellent third quarter earnings season reports by the profitable and recently profitable biotech companies, and the strength of the US dollar.

Future Expectations

In earlier years, we would have expected the biotechnology sector to fair less well than broad markets, but the sector is now regarded by investors as defensive so the NASDAQ Biotech index finished October down over 3.0% while the Fund was down 2.9%, both in Sterling terms, respectively.

Fund Details