The ValuGro General Equity fund, which is managed by ValuGro Capital and administered by Metropolitan, was launched on the 18 th March 2005.

We have previously stated that we would not comment on the fund's performance for any period less than 6 months. As the 30th September 2005 marks the end of the third "official" unit trust quarter of this year, the fund has now been in existence for more than 6 months, accordingly we owe our investors a performance update. I am happy to report that the ValuGro General Equtiy Fund has delivered a 27.43% return in the 6
months to the 30 th September. This return can be compared to the fund's performance benchmark, the JSE All Share Index, which returned 26.9% over the official 6 month period.

I am also pleased to inform you that the fund was the 7 th ranked General Equity unit trust during this period, out of 61 funds.

Going forward this fund will keep to its mandate of being close to fully invested in equities, thereby providing an ideal vehicle to investors who want very high equity exposure at all times.

During the month of July the oil price surged over 7% finishing the month above $60 a barrel as hurricanes in the Gulf of Mexico raised fears of disruptions in U.S. oil supply. Despite the rising oil price, up almost 50% since the beginning of the year, local and global consumers and economies remain surprisingly resilient. Higher oil prices generally do not affect growth unless higher prices are sustained. Should the Rand begin to weaken significantly against the dollar, any negative effects on local growth will be amplified. In a case of sustained higher oil prices and a weak rand, oil companies would be one of the few economic "winners" in the SA economy.

The fund portfolio was well positioned throughout the month of July to benefit directly from increasing oil prices through a 9.69% holding in BHP Billiton and a 6.82% holding in Sasol. Earnings from Billiton's oil businesses contributed 21% of their interim earnings and with final results being released during August we expect this percentage to be even higher.

Sasol's synfuel business makes up around 60% of the group's operating profit. During July Sasol announced they had locked in 30% of their synfuel production at a minimum price of $45 dollars a barrel (and a maximum price of $85). When you compare this to the forward sale of 30% of the synfuel production at $33 a barrel in the year ended June 2005, one requires no predictions of future oil price movements to foresee that hugely improved earnings will be enjoyed by Sasol over the next 12 months.

The fund's strategy of being heavily weighted in the JSE's top 25 stocks continued to benefit investors. With the fund being launched on 17th March this year it has just completed its first full unit trust quarter. For the 3 months to 30 th June 2005 your fund was up some 4,8%. This is the last time I shall comment on a performance period as short as 3 months but as the fund is only just "older" than that I had no choice.

Going forward I have identified a number of stocks outside the ALSI 25 that appear to offer good value. Accordingly the fund will have a number of new holdings in the coming weeks. I expect these to enable the fund to achieve its aim of outperforming the JSE ALSI by a good margin over the long-term.

The ValuGro General Equity Fund was launched on the 17 th of March 2005. We will use this opportunity, our first fund fact sheet commentary, to explain our performance objectives and management approach for this fund. The fund aims to outperform the J.S.E All Share Index (J203), our selected benchmark. If we do outperform we earn a performance fee; if we don't then we don't earn one.

The ValuGro fund is mandated to have a minimum equity exposure of 80% and a maximum of close to 100%. We will attempt to use asset allocation as a tool for out-performance by taking the fund to the maximum 20% cash holding when concerned about high equity valuations.

Unless a number of specific opportunities arise, we will have a heavy weighting to the top 25 shares in the All Share Index. When opportunities do arise, however, we may have a very low exposure to many of those 25 largest-cap shares.

During the month of April your fund held a maximum cash exposure. The effect of this asset allocation was better capital preservation in a falling equity market. No significant sector or stock opportunities were identified by us during the month, hence a fairly high exposure to the JSE's top 25 stocks.

The asset allocation as at the 30th of April indicates a cash holding of 31.88%. This value is misrepresentative of the fund's maximum cash objective of 20% and arose due to significant fund inflows received on the last trading days of the month.