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Fund Manager Biography
To provide an attractive return to shareholders each year in the form of dividends and/or capital returns, together with prospects for capital growth. The Company's portfolio is managed in two parts. The first part comprises investments in UK equities and equity-related securities of large and mid-sized companies (the Equities portfolio) and the second part comprises investments in fixed interest and other higher yielding stocks and securities (the Higher Yielding Portfolio). At outset the Equities portfolio represented 80 per cent of the overall portfolio.
Fund Manager
Rodger McNair
Fund Manager Commentary
	The Company’s net asset value increased 5.2% on a total return basis during the month. The position in Vodafone, the global mobile telecommunication company, was increased. The rapid penetration of smart phones, led by the success of Apple’s iPhone, and the accompanying increase in data traffic will put increasing strain on mobile networks. The well invested nature of Vodafone’s mobile network places it in a strong competitive position relative to its more capacity constrained competitors. The recent increased price of data packages is an indication of the strain the explosion of data traffic is placing on its competition. The group still faces challenging trading conditions in some regions, notably Southern Europe, as elevated unemployment levels and austerity measures impinge on mobile phone use. Despite these pressures the company recently reported organic revenue growth at a group level as the Asian and US business delivered strong trading results. The UK equity market responded positively to the results of the European banks stress test and the deferral of some of the more penal Basel III banking regulation proposals. Despite positive regulatory news for the banking sector there is still scant evidence of any easing of lending criteria. The reluctance of banks to extend credit will stifle economic activity, especially amongst small and medium sized businesses that generally carry a higher credit risk. We continue to utilise the opportunity to invest internationally through UK listed companies in order to limit exposure to the challenges facing the UK economy. (As at 31 July 2010)

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