OUR small-cap portfolio slid about one per cent as investors paused to review the progress of the global economic recovery and the relative valuation of stocks. But blue chips held up rather well, with the Straits Times Index (STI) edging up 0.2 per cent in the week to yesterday.

Among the stocks in our portfolio, S-chips in the chemical fibre business were the biggest losers last week. China Sky slumped 6.3 per cent while Li Heng shed 6 per cent. There were 19 losers compared with just three gainers in our portfolio. Even then, one of the gainers was Swissco, which was suspended at a last-bid price of 90 cents.

CSE Global and Bonvests were the other two gainers, up 3 and one per cent respectively.

Yesterday, the STI gained 1.28 points or 0.05 per cent to 2,716.62. Volume totalled 1.27 billion shares worth $952 million - significantly lower than average daily volume of 1.70 billion shares worth $1.35 billion last week.

'The key question going forward is whether the current global recovery momentum can continue once the effects of fiscal stimulus wear off,' DBS analysts said in a report.

As of yesterday, our portfolio was up 52 per cent from the dummy capital of $150,000 in October 2003. That's a compounded return of 7.2 per cent a year. A few privatisations have left the portfolio with quite a large cash holding. Some 26 per cent of the value of the portfolio is now in cash.