UK Select Alpha Fund

The investment objective of the Fund is to seek to generate an absolute return

in all market conditions through exposure primarily to UK securities.

as at 31 October 2008

Key Points

  • Investment management responsibility for the fund is with John Husselbee of North Investment Partners since its launch on 8 December 2006
  • Looking to provide consistent long term capital growth from the UK Equity market at reduced levels of volatility
  • Active management accessing a full range of investment tools and products
  • Objective offers investors consistent, positive returns in excess of LIBOR +2% over a three-year rolling period
  • Sector: IMA UK All Companies

Current Views

September was characterised by a rapid and historically unprecedented series of government interventions in the market. Most notably of course being the US government’s ~£400B bailout package for the banking sector. In the UK events the failure of Bradford and Bingley, in turn causing a white knight in the form of Lloyds TSB, to attempt to rescue HBOS from collapse. Many investment professionals and media personalities blamed the sudden series of bank failures on the practice of ‘short selling’ and regulators on both sides of the Atlantic quickly took action to mitigate the risk that this practice posed to the markets. Its prohibition, though, failed to halt further declines.

Some relief for consumers arrived as the price of oil fell; crude dropped below $100 for the first time since April 2008. As the UK heads into the coming colder months there is hope that cheaper oil will translate into lower household heating costs.

As historical as these events have been so too is the opportunity in equities, which are undoubtedly undervalued by a market fuelled by reactionary fear. Accordingly, we believe that the equities markets currently offer good value for investors with a longer time horizon. Moreover, those who have seen the value of their portfolios shaken by recent events should be wary of falling prey to panic and the risk of cashing out at the bottom.

Holdings and Asset Class

Lindsell Train UK Equity Equity
Psigma Income Fund Absolute Strategies
River & Mercantile UK Equity Equity
Rensburg UK Mgers Focus Equity
iShares FTSE 100 Equity
Merrill Lynch World Mining Tangible Assets
Rights & Issues Invest Trust Equity
MedicX Property
F&C Comm Property Trust Property
Goldman Sachs 3-yr FTSE Absolute Strategies

Financial Information

Nav Class A Acc 82.92p
Total Net Assets £4.56m

Asset Allocation

Equities by Region (exposure as % of equities)

Performance of the Fund vs Benchmark

Five-Year Performance

Year- Calendar year
to-date 2007 2006 2005 2004 2003
Fund -35.27% 1.78% n/a n/a n/a n/a
IMA UK All Companies sector -35.16% 1.80% n/a n/a n/a n/a
IMA UK All Companies sector ranking 195/330 183/312 n/a n/a n/a n/a
Quartile 3 3 n/a n/a n/a n/a

Fund Facts

ISIN Class A Acc GB00B1GWB60
Distribution Semi Annual
31 May & 30 November
Dealing/Valuation Frequency Daily
Accounting Year-End 30 September
Settlement T+4
EU Savings Directive In scope
Currency GBP
Annual Charge Class A 1.50%
Minimum Initial Class A £1,000
Initial Charge 5.00%
ISA Wrapper Yes
ISA Transfer Yes
Savings Plan Yes
Sector IMA UK All Companies
Depositary
Bank of New York Trust and Depositary
Registrar
Capita Financial Administrators