MANAGERS MONTHLY COMMENTARY

SEPTEMBER 2012

INVESTMENT MANAGERS
Patrick Toes
Investment Director with over 20 years experience in fund management. Previously a member of Rensburg Sheppards Asset Allocation and Fund Selection Committees for over 9 years and former chairman of those committees at BWD Rensburg, he holds a MSC in Investment Analysis and is an Associate Member of the Society of Investment Professionals (ASIP).

INVESTING IN A STATE OF PARADOX

It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to heaven, we were all going direct the other way.
Charles Dickens Whilst August was full of rhetoric about what central banks were going to do, September has seen action. Firstly from the German constitutional court giving its seal of approval to more bail outs (with limits of German exposure stated), then the ECB instigating a variant of QE called OMT and new QE programmes from the US Fed & the Bank of Japan. These factors have lifted animal spirits and risk assets at a time when global growth is weak and in decline and our expectation that corporate earnings will mirror that weakness. We are not in the camp that believes that QE has a meaningful economic impact; it simply provides a sugar rush for risk assets and a subsequent low when removed. However the Feds recent action, QE infinity, given the commitment to keep it in place until unemployment falls, is different to earlier QE exercises. If you believe, as I do, that buying mortgage debt and treasuries has little ability to effect such a change in unemployment, you are left with the inevitable conclusion that the printing presses may stay on indefinitely. We feel this contradictory state or paradox will be with us for many years to come and is the subject of our thoughts this month. This year is the bicentenary of the birth of Charles Dickens. I thought the opening sentence of A Tale of Two Cities expresses a state of paradox very well. It put me in mind of individuals who might have to experience paradox and how they deal with it. Rather amusingly my first thought was the Pushmi-Pullyu of Dr Doolittle fame: Although it is a work of fiction it can give us some insight to dealing with a paradoxical state. It allows us some comic relief at expense of Dr Doolittles alter egos: Drs Bernanke, King and Draghi - Drs Do-toomuch or Do-whatever it takes. It has afforded a segue to the Pushmi Pullyus eventual fate. It joined Dr Doolittles circus and in true paradoxical fashion Drs Do-toomuch have their own circus act, tightrope walking, in which investors are obliged to take part. This tightrope walk is not optional from an investors perspective, we have to accept the reality of the situation. The best plan is to walk straight ahead and try to get to the other side. However one risk is the longer QE infinity extends, the further asset prices rally and diverge from fundamentals, setting up a risk of future problems. The other risk on the tightrope walk is that they run out of ink for the printing press (a Mitt Romney presidential victory) or that investors dont lose faith in its capacity to work. Just like the high wire such tensions can lead to a long fall. HOW SHOULD WE INVEST IN THIS ENVIRONMENT? We are very modestly overweight equities, hoping to benefit from QE infinity. But our focus has been to avoid more cyclical stocks as we worry that those may suffer from the weak growth fundamentals most. However we think it is incumbent that we provide a safety net, so that should the tightrope walk fail, we have several strategies which will protect against a fall. This forms part of our wider investment strategy of castle, moat and drawbridge, which we will be talking about shortly. This strategy has proved quite successful as evidenced by our performance this year. IMPORTANT NOTE: We have taken the decision to rename two of our risk levels, Adventurous and Highly Adventurous, as many clients feel they do not best describe the risks being taken. They are now called Progressive and Adventurous respectively. Needless to say the way we manage these portfolios will remain unaltered.

David Cowell
Chief Executive, possessing over 40 years experience in financial services, with over 25 years being investment management focussed. David formulates the macro economic position and leads the investment process across the portfolio range. He also has over 10 years experience of business consultancy to small and medium sized enterprises.

For further information call :

0113 274 7700

Email : info@mcim.co.uk Or visit us at : www.myddletoncroft.co.uk

IMPORTANT INFORMATION This information has been approved for distribution to professional investors only. The information in this document is believed to be correct but cannot be guaranteed. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. This material is not intended as an offer or solicitation for the purchase or sale of any security or any other action, without first seeking advice as to the suitability of it for your needs.

Myddleton Croft Investment Managers, 1 Woodside Mews, Clayton Wood Close, Leeds, LS16 6QE T: 0113 274 7700 F: 0113 274 7711 E-mail: info@mcim.co.uk Website: www.myddletoncroft.co.uk Myddleton Croft Ltd is authorised and regulated by the Financial Services Authority. Registered in England & Wales number 05782909. VAT number UK 889 241088. Registered office: 11 Clifford Avenue, Ilkley, LS29 0AS.

MCIM Balanced Defensive Portfolio

INVESTMENT MANAGERS
Patrick Toes
Investment Director with over 20 years experience in fund management. Previously a member of Rensburg Sheppards Asset Allocation and Fund Selection Committees for over 9 years and former chairman of those committees at BWD Rensburg, he holds a MSC in Investment Analysis and is an Associate Member of the Society of Investment Professionals (ASIP).

SEPTEMBER 2012

PERFORMANCE SINCE LAUNCH

David Cowell
Chief Executive, possessing over 40 years experience in financial services, with over 25 years being investment management focussed. David formulates the macro economic position and leads the investment process across the portfolio range. He also has over 10 years experience of business consultancy to small and medium sized enterprises.

Model portfolios include cost of underlying investments and Myddleton Crofts annual management fees, but not the charges for custodian, dealing and settlement (equivalent to platform charges)

2012 PERFORMANCE

For further information call :

0113 274 7700

Email : info@mcim.co.uk Or visit us at : www.myddletoncroft.co.uk

IMPORTANT INFORMATION This information has been approved for distribution to retail and professional investors only. The information in this document is believed to be correct but cannot be guaranteed. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Before contemplating any transaction, you should consult your financial adviser. This material is not intended as an offer or solicitation for the purchase or sale of any security or any other action, without first seeking advice as to the suitability of it for your needs. *Clients portfolios may differ from model portfolios dependent on their specific objectives.

ASSET ALLOCATION

10% 19%

UK Equities International Equities

16%

Alternatives Commodities

7% 5% 20%

23%

UK Fixed Interest Global Fixed Interest Cash

Myddleton Croft Investment Managers, 1 Woodside Mews, Clayton Wood Close, Leeds, LS16 6QE T: 0113 274 7700 F: 0113 274 7711 E-mail: info@mcim.co.uk Website: www.myddletoncroft.co.uk Myddleton Croft Ltd is authorised and regulated by the Financial Services Authority. Registered in England & Wales number 05782909. VAT number UK 889 241088. Registered office: 11 Clifford Avenue, Ilkley, LS29 0AS.

MCIM Balanced Cautious Portfolio

INVESTMENT MANAGERS
Patrick Toes
Investment Director with over 20 years experience in fund management. Previously a member of Rensburg Sheppards Asset Allocation and Fund Selection Committees for over 9 years and former chairman of those committees at BWD Rensburg, he holds a MSC in Investment Analysis and is an Associate Member of the Society of Investment Professionals (ASIP).

SEPTEMBER 2012

PERFORMANCE SINCE LAUNCH

David Cowell
Chief Executive, possessing over 40 years experience in financial services, with over 25 years being investment management focussed. David formulates the macro economic position and leads the investment process across the portfolio range. He also has over 10 years experience of business consultancy to small and medium sized enterprises.

2012 PERFORMANCE
Model portfolios include cost of underlying investments and Myddleton Crofts annual management fees, but not the charges for custodian, dealing and settlement (equivalent to platform charges)

For further information call :

0113 274 7700

Email : info@mcim.co.uk Or visit us at : www.myddletoncroft.co.uk

IMPORTANT INFORMATION This information has been approved for distribution to retail and professional investors only. The information in this document is believed to be correct but cannot be guaranteed. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Before contemplating any transaction, you should consult your financial adviser. This material is not intended as an offer or solicitation for the purchase or sale of any security or any other action, without first seeking advice as to the suitability of it for your needs. *Clients portfolios may differ from model portfolios dependent on their specific objectives.

ASSET ALLOCATION

8% 21% 15%

UK Equities International Equities Alternatives

6% 5% 27%

Commodities UK Fixed Interest Global Fixed Interest 18% Cash

Myddleton Croft Investment Managers, 1 Woodside Mews, Clayton Wood Close, Leeds, LS16 6QE T: 0113 274 7700 F: 0113 274 7711 E-mail: info@mcim.co.uk Website: www.myddletoncroft.co.uk Myddleton Croft Ltd is authorised and regulated by the Financial Services Authority. Registered in England & Wales number 05782909. VAT number UK 889 241088. Registered office: 11 Clifford Avenue, Ilkley, LS29 0AS.

MCIM Balanced Moderate Portfolio

INVESTMENT MANAGERS
Patrick Toes
Investment Director with over 20 years experience in fund management. Previously a member of Rensburg Sheppards Asset Allocation and Fund Selection Committees for over 9 years and former chairman of those committees at BWD Rensburg, he holds a MSC in Investment Analysis and is an Associate Member of the Society of Investment Professionals (ASIP).

SEPTEMBER 2012

PERFORMANCE SINCE LAUNCH

David Cowell
Chief Executive, possessing over 40 years experience in financial services, with over 25 years being investment management focussed. David formulates the macro economic position and leads the investment process across the portfolio range. He also has over 10 years experience of business consultancy to small and medium sized enterprises.

2012 PERFORMANCE
Model portfolios include cost of underlying investments and Myddleton Crofts annual management fees, but not the charges for custodian, dealing and settlement (equivalent to platform charges)

For further information call :

0113 274 7700

Email : info@mcim.co.uk Or visit us at : www.myddletoncroft.co.uk

IMPORTANT INFORMATION This information has been approved for distribution to retail and professional investors only. The information in this document is believed to be correct but cannot be guaranteed. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Before contemplating any transaction, you should consult your financial adviser. This material is not intended as an offer or solicitation for the purchase or sale of any security or any other action, without first seeking advice as to the suitability of it for your needs. *Clients portfolios may differ from model portfolios dependent on their specific objectives.

ASSET ALLOCATION ASSET ALLOCATION

UK Equities 6% 15% 5% 4% 17% 30% 23% Alternatives Commodities UK Fixed Interest Global Fixed Interest Cash International Equities

Myddleton Croft Investment Managers, 1 Woodside Mews, Clayton Wood Close, Leeds, LS16 6QE T: 0113 274 7700 F: 0113 274 7711 E-mail: info@mcim.co.uk Website: www.myddletoncroft.co.uk Myddleton Croft Ltd is authorised and regulated by the Financial Services Authority. Registered in England & Wales number 05782909. VAT number UK 889 241088. Registered office: 11 Clifford Avenue, Ilkley, LS29 0AS.

***IMPORTANT NOTE : THE ADVENTUROUS PORTFOLIO HAS BEEN RENAMED THE PROGRESSIVE PORTFOLIO*** MCIM Balanced Progressive Portfolio
INVESTMENT MANAGERS
Patrick Toes
Investment Director with over 20 years experience in fund management. Previously a member of Rensburg Sheppards Asset Allocation and Fund Selection Committees for over 9 years and former chairman of those committees at BWD Rensburg, he holds a MSC in Investment Analysis and is an Associate Member of the Society of Investment Professionals (ASIP).

SEPTEMBER 2012

PERFORMANCE SINCE LAUNCH

David Cowell
Chief Executive, possessing over 40 years experience in financial services, with over 25 years being investment management focussed. David formulates the macro economic position and leads the investment process across the portfolio range. He also has over 10 years experience of business consultancy to small and medium sized enterprises.

2012 PERFORMANCE
Model portfolios include cost of underlying investments and Myddleton Crofts annual management fees, but not the charges for custodian, dealing and settlement (equivalent to platform charges)

For further information call :

0113 274 7700

Email : info@mcim.co.uk Or visit us at : www.myddletoncroft.co.uk

IMPORTANT INFORMATION This information has been approved for distribution to retail and professional investors only. The information in this document is believed to be correct but cannot be guaranteed. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Before contemplating any transaction, you should consult your financial adviser. This material is not intended as an offer or solicitation for the purchase or sale of any security or any other action, without first seeking advice as to the suitability of it for your needs. *Clients portfolios may differ from model portfolios dependent on their specific objectives.

ASSET ALLOCATION

5% 14% 4% 4% 25%

UK Equities International Equities Alternatives Commodities UK Fixed Interest

16% 32% Global Fixed Interest Cash

Myddleton Croft Investment Managers, 1 Woodside Mews, Clayton Wood Close, Leeds, LS16 6QE T: 0113 274 7700 F: 0113 274 7711 E-mail: info@mcim.co.uk Website: www.myddletoncroft.co.uk Myddleton Croft Ltd is authorised and regulated by the Financial Services Authority. Registered in England & Wales number 05782909. VAT number UK 889 241088. Registered office: 11 Clifford Avenue, Ilkley, LS29 0AS.

***IMPORTANT NOTE: THE HIGHLY ADVENTUROUS PORTFOLIO HAS BEEN RENAMED THE ADVENTUROUS PORTFOLIO***

MCIM Balanced Adventurous Portfolio

INVESTMENT MANAGERS
Patrick Toes
Investment Director with over 20 years experience in fund management. Previously a member of Rensburg Sheppards Asset Allocation and Fund Selection Committees for over 9 years and former chairman of those committees at BWD Rensburg, he holds a MSC in Investment Analysis and is an Associate Member of the Society of Investment Professionals (ASIP).

SEPTEMBER 2012

PERFORMANCE SINCE LAUNCH

David Cowell
Chief Executive, possessing over 40 years experience in financial services, with over 25 years being investment management focussed. David formulates the macro economic position and leads the investment process across the portfolio range. He also has over 10 years experience of business consultancy to small and medium sized enterprises.

2012 PERFORMANCE
Model portfolios include cost of underlying investments and Myddleton Crofts annual management fees, but not the charges for custodian, dealing and settlement (equivalent to platform charges)

For further information call :

0113 274 7700

Email : info@mcim.co.uk Or visit us at : www.myddletoncroft.co.uk

MPORTANT INFORMATION This information has been approved for distribution to retail and professional investors only. The information in this document is believed to be correct but cannot be guaranteed. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Before contemplating any transaction, you should consult your financial adviser. This material is not intended as an offer or solicitation for the purchase or sale of any security or any other action, without first seeking advice as to the suitability of it for your needs. *Clients portfolios may differ from model portfolios dependent on their specific objectives.

ASSET ALLOCATION

3% 13% 28% 4% 3%

UK Equities International Equities Alternatives Commodities

14%

UK Fixed Interest Global Fixed Interest 35% Cash

Myddleton Croft Investment Managers, 1 Woodside Mews, Clayton Wood Close, Leeds, LS16 6QE T: 0113 274 7700 F: 0113 274 7711 E-mail: info@mcim.co.uk Website: www.myddletoncroft.co.uk Myddleton Croft Ltd is authorised and regulated by the Financial Services Authority. Registered in England & Wales number 05782909. VAT number UK 889 241088. Registered office: 11 Clifford Avenue, Ilkley, LS29 0AS.

MCIM Balanced Speculative Portfolio

INVESTMENT MANAGERS
Patrick Toes
Investment Director with over 20 years experience in fund management. Previously a member of Rensburg Sheppards Asset Allocation and Fund Selection Committees for over 9 years and former chairman of those committees at BWD Rensburg, he holds a MSC in Investment Analysis and is an Associate Member of the Society of Investment Professionals (ASIP).

SEPTEMBER 2012

PERFORMANCE SINCE LAUNCH

David Cowell
Chief Executive, possessing over 40 years experience in financial services, with over 25 years being investment management focussed. David formulates the macro economic position and leads the investment process across the portfolio range. He also has over 10 years experience of business consultancy to small and medium sized enterprises.

2012 PERFORMANCE
Model portfolios include cost of underlying investments and Myddleton Crofts annual management fees, but not the charges for custodian, dealing and settlement (equivalent to platform charges)

For further information call :

0113 274 7700

Email : info@mcim.co.uk Or visit us at : www.myddletoncroft.co.uk

MPORTANT INFORMATION This information has been approved for distribution to retail and professional investors only. The information in this document is believed to be correct but cannot be guaranteed. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Before contemplating any transaction, you should consult your financial adviser. This material is not intended as an offer or solicitation for the purchase or sale of any security or any other action, without first seeking advice as to the suitability of it for your needs. *Clients portfolios may differ from model portfolios dependent on their specific objectives.

ASSET ALLOCATION

1% 4% 2% 7%

5%

UK Equities International Equities 35% Alternatives Commodities UK Fixed Interest Global Fixed Interest

46% Cash

Myddleton Croft Investment Managers, 1 Woodside Mews, Clayton Wood Close, Leeds, LS16 6QE T: 0113 274 7700 F: 0113 274 7711 E-mail: info@mcim.co.uk Website: www.myddletoncroft.co.uk Myddleton Croft Ltd is authorised and regulated by the Financial Services Authority. Registered in England & Wales number 05782909. VAT number UK 889 241088. Registered office: 11 Clifford Avenue, Ilkley, LS29 0AS.

MCIM Enhanced Income Portfolio

INVESTMENT MANAGERS INVESTMENT MANAGERS
Patrick Toes Patrick Toes Investment Director with over 20 years

SEPTEMBER 2012

PERFORMANCE SINCE LAUNCH

Investment in experience Director with over 20 years fund management. experience fund management. Previously a inmember of Rensburg Previously Assetmember of and Fund a Sheppards Allocation Rensburg Sheppards Asset 9 years and Fund Selection Committees for overAllocation and former Selection Committees for over years and former chairman of those committees at9BWD Rensburg, he chairman of those committees at and is an Associate holds a MSC in Investment Analysis BWD Rensburg, he holds MSC Society of Investment and is an Membera of the in Investment AnalysisProfessionals Associate Member of the Society of Investment (ASIP). Professionals (ASIP).

David Cowell David CowellExecutive, possessing over 40 years Chief

Chief Executive, possessing over 40 over experience in financial services, withyears experience in financial services, with over 25 years being investment management 25 years David formulates the macro focussed. being investment management focussed. leads formulates the macro economic position andDavid the investment process economic portfolio range. He the investment10 years position and leads also has over process across the across the of business consultancy to small and experience portfolio range. He also has over 10 years experience of business medium sized enterprises. consultancy to small and medium sized enterprises.

12 MONTH PERFORMANCE
Model portfolios include cost of underlying Model portfolios include cost of underlying investments investments and and Myddleton Crofts Myddleton Crofts annual annual management fees, but not the charges for custodian, management fees, but not the charges for custodian, dealing and settlement (equivalent to platform dealing and settlement (equivalent to platform charges) charges)

For further information call For further information call : :

0113 274 7700 0113 274 7700

Email info@mcim.co.uk Email ::info@mcim.co.uk Or visit us at Or visit us at : : www.myddletoncroft.co.uk www.myddletoncroft.co.uk

The Enhanced Income Portfolio was launched at the beginning of 2011. It should be noted that the performance before that date (presented above) is from the back-tested portfolio and is provided for illustration purposes only.

ASSET ALLOCATION

IMPORTANT INFORMATION MPORTANT INFORMATION This information has been approved distribution to This information has been approved forfor distribution to and and professional investors only. The retailretailprofessional investors only. The information information in this believed to believed but correct in this document is document isbe correctto becannot . but cannot be Past performance is not a guide to be guaranteed. guaranteed. Past performance is not a guide to future and may not be may not be future performance performance andrepeated. The repeated. The value of the income and them may value of investments andinvestments fromthe income from them may go down as well as up not investors go down as well as up and investors may and get back may amounts originally invested. the not get back the amounts originally invested. Before Before contemplating any transaction, you should contemplating any transaction, you should consult consult your adviser. This material is not intendednot financial adviser. This material is as your financial intended solicitation for the purchase or sale of any an offer oras an offer or solicitation for the purchase or sale of or security or action, without without first security any any other any other action,first seeking seeking to the as to the suitability of needs. advice asadvice suitability of it for yourit for your needs. *Clients portfolios may differ from model portfolios *Clients portfolios may differ from model portfolios dependent on their specific objectives. dependent on their specific objectives.

5% 5% 5% 15%

UK Equities International Equities Alternatives

45%

5%

Commodities UK Fixed Interest

20%

Global Fixed Interest Cash

Myddleton Croft Investment Managers, 1 Woodside Mews, Clayton Wood Close, Leeds, LS16 6QE T: 0113 274 7700 F: 0113 274 7711 E-mail: info@mcim.co.uk Website: www.myddletoncroft.co.uk Myddleton Croft Ltd is authorised and regulated by the Financial Services Authority. Registered in England & Wales number 05782909. VAT number UK 889 241088. Registered office: 11 Clifford Avenue, Ilkley, LS29 0AS.

MCIM Tactical Growth Portfolio

INVESTMENT MANAGERS
Patrick Toes
Investment Director with over 20 years experience in fund management. Previously a member of Rensburg Sheppards Asset Allocation and Fund Selection Committees for over 9 years and former chairman of those committees at BWD Rensburg, he holds a MSC in Investment Analysis and is an Associate Member of the Society of Investment Professionals (ASIP).

SEPTEMBER 2012

PERFORMANCE SINCE LAUNCH*

David Cowell
Chief Executive, possessing over 40 years experience in financial services, with over 25 years being investment management focussed. David formulates the macro economic position and leads the investment process across the portfolio range. He also has over 10 years experience of business consultancy to small and medium sized enterprises.

2012 PERFORMANCE*
Model portfolios include cost of underlying investments and Myddleton Crofts annual management fees, but not the charges for custodian, dealing and settlement (equivalent to platform charges)

For further information call :

0113 274 7700

Email : info@mcim.co.uk Or visit us at : www.myddletoncroft.co.uk

MPORTANT INFORMATION This information has been approved for distribution to retail and professional investors only. The information in this document is believed to be correct but cannot be guaranteed. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Before contemplating any transaction, you should consult your financial adviser. This material is not intended as an offer or solicitation for the purchase or sale of any security or any other action, without first seeking advice as to the suitability of it for your needs. *Clients portfolios may differ from model portfolios dependent on their specific objectives.

*Soft-launched inJune 2012. Performance prior to June 2012 is back-tested.

ASSET ALLOCATION

10%

10%

UK Equities International Equities

20% Alternatives 35% 11% 14% Commodities Global Fixed Interest Cash

Myddleton Croft Investment Managers, 1 Woodside Mews, Clayton Wood Close, Leeds, LS16 6QE T: 0113 274 7700 F: 0113 274 7711 E-mail: info@mcim.co.uk Website: www.myddletoncroft.co.uk Myddleton Croft Ltd is authorised and regulated by the Financial Services Authority. Registered in England & Wales number 05782909. VAT number UK 889 241088. Registered office: 11 Clifford Avenue, Ilkley, LS29 0AS.