The P&C Global Gold and Natural Resources Fund was successfully launched on the 20th February, 2003.

The fund, based on the 31st March valuation, has declined by 3.6% in USD since launch. This includes all initial investment costs, as well as set up and other costs. The Merill Lynch International Gold and General Fund (USD) was down 10.93% and the FTSE Gold Mines Index (USD) down 9.88% over the same period. Gold and silver were down nearly 5%. We know the adage that "you cannot feed yourself on relative dollars" but hope that investors in the fund are satisfied that its performance so far has beaten both the major competition and an index (which doesn't have to pay any fees!). The fund's objective is to make money for its investors and the Fund's Advisers are only too aware of that.

The fund is now roughly three-quarters invested. It holds a diversified portfolio of major, medium-sized and junior gold mining company shares in North America (46%), Australasia (15%), Africa (15%) and other countries. To date the fund has not bought physical gold. Gold has fallen from about $352 when the fund was launched to around $330 today. The decision not to buy physical metal was correct.

Baker Steel, the adviser to the fund, believe that the current set back in gold shares as well as physical metal offers and excellent buying opportunity. It is the intention of the fund to become even more fully invested in the period ahead. Now that we have a fairly full investment position in mining shares, the next step is to obtain exposure to physical metals themselves.