Fund Objective

To provide long term capital growth from a portfolio of global investments.

View on Past Performance

October proved to be one of the most turbulent months ever and another difficult month for equity markets around the world with the US falling 16%, the UK and Europe down 12% and Japan down 25%. Currency markets saw the USD and the yen strengthening against most other currencies. Oil continued its downward move falling from close to 100 USD per barrel at the beginning of the month to 65 USD per barrel at the end of the month.After having strengthened in September due to its consideration as a safe haven, Gold, fell from 870 USD to 725 USD at the end of the month as fears of deflation became more widespread. In this environment, more cautious funds like Invesco Perpetual High Income or Schroder Tokyo continued to outperform and the more aggressive Equity funds continued to suffer.Melchior Japan, an investment trust badly hit during July and Augustdue to the holding of a high proportion in small caps in Japan with restricted liquidity, outperformed during October after the managers turned around the portfolio to a more defensive profile with a higher proportion of mid and large caps.

Future Expectations

In terms of outlook, we believe it is still early to increase the risk in the portfolio for a number of reasons. First, the credit crisis remains, though signs of improvement are becoming apparent. Second, bank recapitalisations continue and write offs have further to go. Third, we know the world is heading into recession, but there is no clarity over the length or depth of the downturn. In this environment we remain cautious waiting for further stabilisation in the markets.

Fund Details