Performance commentary
So the Fund had a good quarter in the third quarter of the year, strongly outperforming its benchmark, largely driven by our holdings in equities – some of our health-care holdings such as Abbott Laboratories and Novartis did particularly well in the period; some of our technology holdings – Microsoft – continued to do well, and our holding in the media sector – Wolters Kluwer – also continued to perform well for the Fund, so they were the major performance contributors. Some of the stocks we had did detract a little from performance, so some of our semiconductor holdings were weak – Infineon and Applied Materials – as investors started to worry that the semiconductor cycle had started to roll over a little bit, but overall the Fund had a very strong quarter. In terms of income, pleased to say that the Fund generated a slightly increased level of income on an annual basis, when we look at the first three quarters of this year relative to the same period last year, so from an income point of view also producing a good result.

Activity review
It was relatively quiet period for portfolio movements and transactions over the summer months; we did add two new stocks to the portfolio. There had been a little bit of weakness coming through in the results for both BBA Aviation and Informa, which is a global exhibitions company. We believe that those weaker short-term results mask what we think are strong, longer-term businesses, and so we added those two stocks into the portfolio. We did take some profits on some of our more strongly performing stocks over the period, the ones that I mentioned and had contributed to the strong performance, but overall we ended the period with our equity weightings a little bit lower and our cash weightings a little bit higher than when we started the period.

Investment strategy and outlook
So in terms of outlook, the third quarter saw the 10th anniversary of the Lehman’s bankruptcy, and what we saw in the period post the Lehman’s bankruptcy was globally coordinated action to stabilise the financial system. What we’re seeing now is countries increasingly acting in their own self-interest, which is a very different response to the response that we’ve seen over the past decade. Now whilst we continue to see a number of disruptive and structural changes that are going on in the global economy – largely driven by technological change, the outlook for global growth, for relative currency valuations, and for the returns that we’re going to see from financial markets, are increasingly dependent now on how countries interact with each other and how they trade with each other, and so the outcome of the Brexit negotiations and the tug of war in terms of the trade deal between the US and China are likely to be key really now, I think, in determining the kind of financial returns that we see from markets, certainly over the short term.