• 66.76% return since inception, an annualised compound return of 13.64%

• Over the same period, both the FTSE 100 and the MSCI World have fallen, with total returns of -0.69% and -3.64% respectively

• The Elite LWM East-West Value Fund outperforms all major markets in October.

The LWM value strategy is based upon the strategy developed by Benjamin Graham, the tutor of Warren Buffett. We aim to outperform all global markets over the longer term, whilst maintaining a comparatively low level of investment risk.

Not only have we vastly outperformed all major markets, but we have done so with lower volatility.

We hold a concentrated portfolio of the 25-35 best value stocks from around the world. We treat cash as a viable investment class and tend to be benchmark agnostic - If the MSCI World falls by 47% we would not consider losing only 40% a success!

We do not subscribe to Efficient Market Theory. We believe that stock markets can be highly inefficient in the short term, but tend towards efficiency over the longer term. We therefore seek to identify and invest in established companies that are substantially undervalued by the market. Over the longer term the underlying qualities of these companies become apparent and the stock price adjusts to reflect the true value, at which point we sell.

We aim to protect and substantially increase the wealth of our clients. We do not use leverage. Our performance over the past four years shows the value of our focus on loss avoidance. Successful investment management is not about making spectacular returns - it is about making decent returns whilst avoiding spectacular losses.

And we don't ask our clients to do what we won't do ourselves - my personal investment in the LWM value strategy represents by far my biggest single investment holding.

 
The Elite LWM East-West Value Fund makes the LWM value strategy available to UK retail and institutional investors. In October, the fund outperformed all major markets, returning 0.84%.

Of major markets, the best performer was the Dow Jones (+0.00%), effectively unchanged for the month. The Nikkei (-0.97%) was next, followed by the FTSE 100 (-1.74%), the MSCI World (-1.85%) and the S&P 500 (-1.98%). The German DAX (-4.58%) and the French CAC (-4.95%) both fared badly.

We remain concerned that the recent global rally has led to valuations becoming stretched. We therefore continue to position the Fund defensively so as to reduce downside risk to our investors.

 
Prior to 1st December 2008 (the launch date for the Elite LWM East-West Value Fund), the performance figures quoted for the underlying strategy are the gross returns of our entire equity portfolio over the period beginning October 27th 2005. From 27th October 2008 to January 5th 2009 we were 100% in GBP cash for the transfer of clients' assets into the Fund. We measure only the performance of the money that was invested on behalf of our clients. We factor in any cash received in the form of dividends from stocks purchased and any realised cash that was held resultant of the sale of a stock. We do not however factor in sums received for investment that did not enter the investment cycle.

This communication constitutes neither an offer to sell nor a solicitation of an offer to purchase/subscribe to any investment.  All information and attachments (the "Material") are provided by Lowes Wealth Management ("LWM") as part of its internal research activity. This Material is solely for informational purposes, and LWM makes no representations as to accuracy or completeness. LWM is not responsible for errors contained herein and shall not be liable for any consequences arising out of reliance upon same. Opinions herein constitute the present judgement of LWM, which is subject to change without notice.

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