Fund Objective

The objective is to achieve a high level of total return by investing in a diversified portfolio consisting primarily of sub-investment grade bonds. Derivatives may be used from time to time in keeping with the Fund's objective with the intention of either protecting or enhancing the return on the Fund.

View on Past Performance

The European high yield bond market suffered about its worst quarter on record as bond prices were impacted by the fall-out from the banking crisis. The Fund is positioned towards the more defensive end of the market, although this has not prevented us from suffering losses. The Fund's small position in Bradford & Bingley has not performed as hoped and has been sold at a much reduced price.

Future Expectations

We are now beginning to see the consequences of the banking crisis impacting the industrial economy and the realisation in European governments that something must be done to help the banks. Depending on the success of those government initiatives, this may well lead to a long and/or deep economic slowdown. We are trying to remain vigilant with this scenario in mind.

Fund Details