Fund Objective

The Fund aims to invest in a diversified portfolio of transferable equity securities of US and Canadian medium and large sized capitalisation companies listed or traded on recognised exchanges, with preference being given to those with a market capitalisation in excess of US$1 billion.

View on Past Performance

Venting their frustration over the outlook for the economy, market players began to throw in the towel as December and calendar year 2007 came to a close. Investors continued to worry about the risks both to economic growth and inflation.US economic growth, in contrast to annualised real GDP growth of 3.7% over the first three quarters, slowed in the fourth quarter as the negative trends with respect to falling home values, rising housing foreclosures, and further turbulence within the credit and money markets continued. Fears of a looming US recession were given impetus by a weakening in certain manufacturing indices weakened and a fairly sharp rise in inventories.Further action by the Federal Reserve designed to shore up banks' liquidity and enhance their lending capabilities produced only a modest improvement. Meanwhile, more cautious business planning and spending accompanied subdued public confidence.Notwithstanding the negative economic news, corporate earnings estimates for many corporations continued to see upward revisions and, away from the housing market and the distressed parts of the financial sector, corporate balance sheets and cash flows (characteristics that are a key focus for the Fund) tended to remain strong.

Future Expectations

Our view on the US economy is slightly brighter than consensus. While economic momentum is likely to be lacklustre in the coming months, exports and productivity remain sound. At worst, manufacturing is slowing, not contracting.The job market, real consumption, income growth and inflation have continued to move in the right direction, and, notwithstanding seasonal and timing factors, recent comments from major retailers have not been unduly negative.

Fund Details