months ago -- despite the generally weak performance of Bermuda stocks in the same period.

The fund's net asset value (NAV) at December 31 was $9.97, below its starting point of $10. But the fund had also paid out 24 cents in dividends, meaning the fund had increased in value by 2.1 percent over its first three quarters.

The fund's NAV at March 1, 1995 was $9.98.

From March 1, 1994 to December 31, 1994 the Bermuda Stock Exchange Index (BSE) was down about four percent, according to Mr. Sean Kelly, portfolio manager.

"The fund's strategy, set out in the prospectus was for the long term,'' he added.

The mutual fund, launched on March 31 last year and managed by Butterfield Management Company Ltd., has interests in Bermuda Stock Exchange Index (BSE) issues, cash, and BSE notes fixed income instruments.

The fund's most recent quarterly report, covering the first nine months of operations, noted net assets were $13.4 million and continued to grow while rising interest rates and competition from additional supply of new issues launched in previous quarters were cited as reasons for the BSE's decline in returns.

The Exchange has averaged a 13 percent return since inception in 1972 with returns in 1992 and 1993 over 35 percent, but in 1994 the index declined about two percent, a decline which included reinvested dividends, according to the fund's quarterly report.

The fund's NAV, exclusive of dividends, decreased from $10.08 to $9.97 for the three months ended December 31 while the BSE closed down 1.8 percent for the same period.

The fund's total return for its third quarter was -0.2 percent.

Since the letter to shareholders the Buttress Bermuda fund has increased its investments in BSE-listed equities from eight to ten and maintains interests in three fixed income issues.

Buttress Bermuda has holdings in; Bank of Bermuda, Bank of Butterfield, Belco, Argus Insurance, Mid Ocean, Bermuda Home, Bank of Bermuda warrants, BF&M, Chips, and BSL, Bermuda Government bonds, Bank of Bermuda 9% capital notes, Belco 7% '97 notes and cash.