Fund Objective

The objective of the fund is to achieve an above average and steadily increasing income return coupled with capital growth from a portfolio of transferable securities

View on Past Performance

A chronology of events in September reads like a horror story.Week one: the FTSE 100 index falls 7%; Freddie Mac and Fannie Mae are nationalised.Week two: run on Lehman Brothers; Bank of America buys Merrill Lynch.Week three: US Government pumps $80 billion into AIG; in the UK, Lloyds buys HBOS; FTSE 100 plunges 9.9% in four days then shoots up 8.8% on announcement of a $700 billion bail-out bill in the US.Massive liquidity injections, globally, are followed by a short-selling ban on financials in the UK. Morgan Stanley and Goldman Sachs become bankholding companies;Washington Mutual crumbles.Week four: five banks fail - Wachovia, Dexia, Fortis, Glitnir, and Bradford & Bingley. As a final kick in the teeth, September closed with the unexpected rejection of the US bail-out plan, followed by a record high in the VIX index - a 'fear' gauge.Investors are then partially mollified by Ireland's pledge to underwrite bank deposits, and guarantee debt for two years. Trading was muted this month as events took over.We maintained our cash position at around 17% of the total portfolio.

Future Expectations

At a time when events are evolving at break-neck speed, it is important to reassure investors of our defensive positioning and investment process, which amalgamates top-down and bottom-up analyses. At the time of writing, events have moved further still with a coordinated effort by the central banks, complementing the passing of a $700 billion bail-out bill in the US and the part nationalisation of the banks in the UK.Europe has also seen its share of bail-outs, consolidations and government guarantees. These are extraordinary measures in extraordinary times, but no single measure presents a 'silver bullet'. Markets will have to be patient.The point of maximum opportunity is usually when investors are at their most despondent. For UK investors, this point is now most likely in 2009.

Fund Details