Fund Objective

To aim to provide capital growth.

View on Past Performance

Unprecedented market turmoil in September saw Lehman Brothers, AIG, Washington Mutual and Wachovia in the US all succumb to either bankruptcy or takeover. Europe too had its financial scares although Japan came through relatively unscathed. Extreme volatility led to falls in equity markets around the world with Japan falling by over 13%. Economic data deteriorated with export activity slowing and industrial production contracting more sharply than had been expected.

Future Expectations

The eventual ratification of the financial package in Washington should resolve the immediate problems in the US financial system. Japan has been remarkably quiet on this front, even bucking the trend by taking stakes in prestigious Wall Street names such as Morgan Stanley.It is difficult to forecast markets in these volatile times, but we are not inclined to make any hasty changes to the fund, which has weathered the storm well in recent months. The bias will remain on domesticfacing sectors and on companies with strong balance sheets until there is more clarity in future trends.

Fund Details