Fund Objective

To achieve long term capital growth in excess of the performance achieved by the FTSE All Share Index.

View on Past Performance

A sizeable underweight stance helped us to avoid the fall in Japan in July,whilst our overweight European stance worked well (the Eurotop 300 index topped the league table in July, rising 1.9%). The overweight US stance was less successful, with the S&P 500 rising just 0.5% against a 1.2% rise in the UK.Still, it should be mentioned that the overweight US position was built up to offset the underweight Japan stance we adopted at the beginning of the year, and that switch has worked well: year to date Japan is down 5.4%, the US is up 2.3%.Once again the UK markets are performing comparatively well so the 2.3% rise in the value of the fund's A shares so far this year still looks a little miserable against the 5.5% rise in our official benchmark, the FTSE All-Share.Again we make the point that comparing the fund to just one (and a small one at that) stock market is not particularly appropriate, bearing in mind the Fund is designed to invest globally. Compared to a global benchmark, the APCIMS Growth Portfolio, the performance looks more adequate: up 2.3% against the APCIM's 2.08% so far this year.

Future Expectations

Looking ahead it's difficult to see the equity markets breaking out of their sideways trading range for a few more months. Uncertainty over inflation and interest rates is prompting potential buyers to sit on their hands for the rest of the summer. Comparisons with 1987 are doing the rounds with the inevitable conclusion we face a 10%-20% fall in October.This is lazy analysis that chooses to ignore one essential point: shares are cheaper now than they were in 1987. So despite our short term caution we foresee a rebound in markets later in the year when the outlook on inflation is clearer and, with a bit of luck, the Middle East has calmed down.

Fund Details