Fund Objective

To provide a total return.

View on Past Performance

In July, a "flight to quality" enveloped corporate bond markets as investors became increasingly nervous about potential defaults in the subprime mortgage market. Credit spreads widened dramatically; investment grade corporate bonds considerably underperformed equivalent government bonds.Holdings into both Euro and GBP denominated government bonds were of benefit to the Fund as they performed well ahead of corporate bonds. Negative contributions from stock selection within the banking, insurance and financial services sectors more than offset any gains. The Fund ended July trailing its benchmark.

Future Expectations

Purchases included long-dated France Telecom, and some non-step bonds. Going forward, the Fund intends to move from underweight to neutral in credit.

Fund Details