Fund Objective

The Fund will seek to achieve an above average rate of income combined with sound prospects for capital growth.

View on Past Performance

In a truly extraordinary month for world markets, the UK was not immune. Equity prices fell sharply as a succession of high profile failures and rescues in the banking sector took its toll on investor confidence.The fund performed relatively well, with its generally defensive bias and its focus on highly liquid, financially secure companies serving it well. This overall strategy saw the portfolio move even further overweight in the largest stocks in the index, and also extend its overweight stance in healthcare. AstraZeneca and GlaxoSmithKline were among the stocks purchased.We have also made some cautious additions to more cyclical names such as Home Retail Group, which will benefit if, as we expect, interest rates are cut before the year-end. We remain active in the financial sector, taking profits this month in Prudential. Our core holdings here are HSBC, which we see as a long-term winner in the sector, Standard Chartered and Lloyds TSB.

Future Expectations

Looking ahead, we remain bearish on the economy and cautious on the market in the short term. However, the current conditions represent good opportunities for long-term investors in quality franchises.

Fund Details