Fund Objective

The objective of the Taylor Young Growth & Income Fund is to provide capital growth and income.

View on Past Performance

This has been another tough quarter for equities, with further significant volatility. The banking sector was again under extreme pressure, with only HSBC bucking this trend.The tough environment has led to a number of the more 'defensive' companies performing best, such as: Scottish & Southern Energy and National Grid in the utility sector, Tesco and William Morrison in the food retail sector, Capita the outsourcing specialist, Reckitt Benckiser the household and personal carecompany, as wellas British American Tobacco.Conversely, shares in BHP Billiton and Xstrata were weak in the mining sector and, despite operating strongly, Serco, VT and Weir performed poorly. After the active previous quarter in terms of transactions, only one significant change was made.The Royal Bank of Scotland shares were sold due to increasing concerns of further write downs, further capital raising and dilution for shareholders. Since that time the pressure has continued with several banks failing or being forced to merge.

Future Expectations

The significant pressure in the banking system is leading to stresses around the world. Central bank base rates continue to be largely meaningless as far as borrowers are concerned, with significant differentials between the official lending rates and the rates at which the banks are lending to one another.Until this differential narrows and confidence, trust and willingness to lend to each other returns, the pressures will continue, which is why we are seeing such drastic action being taken by authorities around the world, such as the recent $700 billion Troubled Asset Relief Program in the US, the Irish government temporarily guaranteeing all bank deposits, without limits, and the UK government announcing that a total of £500bn of liquidity will be made available.These significant developments, combined with a fall in the oil price and the easing of inflationary influences, should lead to a drop in interest rates around the developed world.Confidence should then begin to emerge so that we can then start to properly anticipate future economic trends again, start to look at fundamentals and seek out investment opportunities in a less volatile market. Without question there are some very attractive opportunities emerging for investors, but one has to be patient before acting.

Fund Details