CY

AN

M

AG

ENTA

Y

ELLO

W

BLA

CK

CM

YK

Com

posi

te

Com

positeP

1BW

345009-0-W00900-1---X

AE

E,E

U,M

W,N

A,S

W,W

E

8414

74_8

4152

1 12/11/2006

P1B

W34

5009

-0-W

0090

0-1-

--X

AP1BW345009-0-W

P1BW345009-0-W00900-1---XA

An investment in iPath ETNs involves risks, including possible loss of principal. For a description of the main risks see “Risk Factors” in theapplicable prospectus.

Barclays Bank PLC has filed a registration statement (including a prospectus) with the SEC for the offering to which this communicationrelates. Before you invest, you should read the prospectus and other documents Barclays Bank PLC has filed with the SEC for more completeinformation about the issuer and this offering. You may get these documents for free by visiting www.iPathETN.com or EDGAR on the SECwebsite at www.sec.gov. Alternatively, Barclays Bank PLC will arrange for Barclays Capital Inc. to send you the prospectus if you request itby calling toll-free 1-877-76-iPATH, or you may request a copy from any other dealer participating in the offering.

iPath ETNs (the “Securities”) are unsecured obligations of Barclays Bank PLC and are not secured debt. The Securities are riskier than ordinary unsecured debt securities andhave no principal protection. The return on the Securities is linked to the performance of a market index. Investing in the Securities is not equivalent to investing directly inindex components or the relevant index itself. The market value of the Securities may be influenced by many unpredictable factors, including, with respect to the iPath ETNslinked to commodities indexes, volatile commodities prices. Risks include limited portfolio diversification, uncertain principal repayment, and illiquidity. Also, the investor fee will reduce the amount of your return at maturity or on redemption, and as a result you may receive less than the principal amount of your investment at maturity or upon redemption of your Securities even if the value of the relevant index has increased. Brokerage commissions will apply to purchases and sales of the Securities in the secondary market. The sale, redemption or maturity of the Securities will generate tax consequences. The trading prices of the Securities will reflect changes in their intrinsic value aswell as market supply and demand, among other factors. The trading prices of the Securities may also be influenced by changes in the credit rating of Barclays Bank PLC.

Barclays Global Investors Services, a subsidiary of Barclays Global Investors, N.A. assists in the promotion of iPath Exchange Traded Notes. Barclays Global Investors, N.A., andBarclays Capital Inc., are affiliates of Barclays Bank PLC.

© 2006 Barclays Global Investors, N.A. All rights reserved. iPath, iPath ETNs and the iPath logo are servicemarks of Barclays Bank PLC. All other trademarks, servicemarks or registered trademarks are the property of their respective owners. 3521-iP-1006

THE BARRIERSOF ENTRY ARE NOW MORE LIKE TINY,LITTLE SPEED BUMPS.

Go to www.iPathETN.com

With convenient access to diffi cult-to-reach markets,your investment strategy is about to change.

December 11, 2006 B A R R O N ' S 9

Lipper’s highest total and consistent re-turn ratings, with annualized gains of9.27% over three years and 10.23% overfive. But it has Lipper’s lowest ratingfor tax efficiency, and a middling ratingfor expense.

“We’re value-oriented investors witha focus on credit” and biased toward sin-gle-B and triple-C-rated bonds, those atthe lowest end of the credit spectrum,with juicy coupons and something of astory, says Weilheimer. That strategywas a winner from 2003 to 2005—butthat was then. “There are not too manyof those situations right now,” he says.

In the portfolio managers’ opinion,current junk yields have priced in a zeroprobability of an economic slowdownnext year. Yes, defaults are at histori-cally low levels, with the global rate be-low 1% in September, according to Stan-dard & Poor’s. But junk will come underpressure “well in advance of defaultspicking up,” predicts Weilheimer, andcould finally move higher in 12 to 18months as the economy slows. The fundwill be well-positioned ahead of anycredit storm, its two managers promise.

Their caution and flexibility appealto Morningstar, the Chicago-based re-search outfit, which gives the fund a

four-star rating. “They’ve done an excep-tional job of seeing risks around the cor-ner and adjusting the portfolio to getout of the way,” says senior analyst EricJacobson, who also considers high-yieldbonds too expensive. “We’re really bigfans of this fund and this team.”

Huggins says that he and Weilhe-imer are focused on the shorter end ofthe relatively flat high-yield curve,where an average junk bond maturingwithin two years might offer a 7.5%yield, versus only around 7 5/8% for a10-year period.

Huggins and Weilheimer also preferto take on senior, rather than subordi-nated, debt. For one thing, it rankshigher in the capital structure. And theadded-returnrewardforholdingtherisk-ier subordinatedpaper isgenerallypuny.

When junk yields rise as prices fall,

the pair’s strategy is to keep the seniorcash bonds and either short the subs orbuy credit-default swaps protection onthem. “It works like clockwork,” Weilhe-imer says.

Their top holdings now are those ofFord Motor Credit, including its 9œ%bonds due 2011 and others with shortermaturities. “The asset coverage is moretangible and significant” at Ford MotorCredit than at its parent, the ailing autogiant Ford Motor (F), says Huggins.And Ford could—although officials havesaid they won’t—sell a majority stake inthe finance unit, just as General Mo-tors (GM) unloaded 51% of General Mo-tors Acceptance Corp.

The fund’s second-biggest holding isIntelsat Holdings, the world’s largestprovider of fixed-orbit satellite services.Its 5ª%bondsdue2008are the“themostsubordinated notes, but also the first ma-turity in the capital structure,” saysWeil-heimer, and the company has stretchedits capital expenditures several yearsout, which should help cash flow.

Their No. 4 holding is GameStop(GME), the world’s largest videogameand entertainment software retailer. Ithas“somuchcash flow,” saysWeilheimer,adding that the bond has “a few points ofupside and...not much downside.” TheNo.6holding,Georgia-Pacific (GP), is indefensive second-lien loans “securedahead of the existing bonds,” Weilheimersays.

An interesting top-10 pick is TrumpEntertainment Resorts (TRMP),which has gone bankrupt twice. “Thenew CEO is finally starting to see betteroperating traction,” says Weilheimer, re-ferringtoJamesPerry, agambling-indus-try veteran who took charge of Trump’sthreeAtlanticCity casinos lastyear. “Val-uations in Atlantic City are starting tolive up to some of [their] capability pro-jected years ago,” Huggins comments.

Weilheimer and Huggins are waryof the mergers and acquisitions thathave become the corporate bond mar-ket’s bane. Many acquisitions of junk-rated companies can benefit bonds ifthe acquirer has a higher credit rat-ing. But fallen angels— investment-grade companies that fell into thejunk-bond abyss—often have bondswith few covenants and can be hurt ifnew leverage is added at the top ofthe capital structure.

“It used to be, in a successful lever-aged buyout, everyone shares the gain,”says Weilheimer. But in the past six toninemonths, it’shasbeen“agamefor jun-ior [Wall Street] associates and lawyersto get around covenants.”

These two coaches of separate LittleLeague teams know something about apayoff. Weilheimer’s son went to aWorld Series tournament and promptlyhit a home run with the $200 aluminumcomposite bat supplied by dear old Dad,and saw his team go on to victory. (Weil-heimer at left in the photo on page 55 isholding that bat.)

Huggins’ exploits in T-ball—a game inwhich beginners hit off a tee—are moremodest. “Myteampreparationusually in-volves making sure everyone’s shoes aretied, pants are pulled up and that every-onehas a glove onwhen they actually runonto the field,” he says.

Kind of makes investing in junk looklike child’s play. n

Eaton Vance Income FundOf Boston800-225-6265

*As of Nov. 30; three- and five-year returns are annualized.**As of Sept. 30. Sources: Eaton Vance; Morningstar

Issuers Of % OfTop 10 Holdings Portfolio**

Ford Motor Credit 3.21%

Intelsat 2.42

Univ City Dev Ptnrs 2.01

GameStop 2.01

Levi Strauss 1.82

Georgia-Pacific 1.79

Rite Aid 1.57

VNU 1.50

Trump Entertainment 1.40

Qwest Comm 1.35

Total: 19.08

Total Returns*1-Yr 3-Yr 5-Yr

Fund (EVIBX) 11.17% 9.16% 10.12%

ML U.S. HY 10.55% 8.83% 9.45%Master II

Scoreboard: Overseas Portfolios Clock a Strong Weekz U.S. diversified equity funds gained an average 0.74%, beating the broad market’s 0.51% rise, inthe week ended Thursday, according to Lipper. Small-cap growth, mid-cap value and mid-cap growthfunds gained 1.09,%, 1.02% and 1.02%, respectively. Telecom funds gained 1.43%; financial-ser-vice funds rose 1.08%. Gold funds lost 1.03%; emerging-markets funds gained 1.93%. Large fundswith strong relative performances included American Funds Euro Pacific Growth, up 1.05%, andFidelity Low-Priced Stock, up 1.02%. —Jack Willoughby

One Week Year-to-Date

U.S. STOCK FUNDS 0.74% 12.37%U.S. BOND FUNDS 0.17 5.30TOP SECTOR / Latin American Funds 2.71 38.29BOTTOM SECTOR / Gold Oriented Funds – 1.03 34.23

THE WEEK'S TOP 10Fund Investment Objective One Week Year-to-Date

Direxion LA Bull 2x Inv Latin America 4.79% NAUS Glbl East European Emerging Markets 4.77 31.16iShares MSCI Austria European Region 4.68 33.09Direxion EM Bl 2x Inv Emerging Markets 4.51 38.25ING Russia A Emerging Markets 4.07 62.48Prasad Growth Fund Small Cap Growth 3.97 – 4.20Metzler/Payden E E Mkt European Region 3.85 45.07iShares MSCI Malaysia Pacific ex Japan 3.79 35.47iShares MSCI Mexico Latin America 3.53 40.22iShares MSCI Sweden European Region 3.51 37.06

THE WEEK'S BOTTOM 10Fund Investment Objective One Week Year-to-Date

Direxion EM Br 2x Inv Emerging Markets – 4.59% – 47.59%BlackRock Rl Invest C Spec Dvsfd Equity – 3.60 – 13.23iShares GSCI Cmmdty-Ix Spec Dvsfd Equity – 3.55 NAPIMCO Comm RR Str Inst Spec Dvsfd Equity – 3.37 1.36Oppenheimer Rl Asset A Spec Dvsfd Equity – 3.30 – 9.36Rydex Commodities H Spec Dvsfd Equity – 3.25 – 14.63iPath ETN GSCI TR Idx A Specialty & Misc – 3.18 NAProFunds Prec Metals Inv Gold Oriented – 3.15 8.97iPath ETN DJ-AIG CITR A Specialty & Misc – 3.10 NAProFunds UltraSht EM Inv DSB – 3.03 NA

THE LARGEST 10Net Assets 3-Year* 1-Week YTD

Fund (billions) Investment Objective Return Return Return

American Funds Gro A $81.822 Multi Cap Growth 13.82% 0.41% 11.50%American Funds ICA A 73.143 Large Cap Value 12.12 0.37 15.14Vanguard 500 Index Inv 71.420 S&P 500 Funds 11.41 0.50 14.63Fidelity Contrafund 67.146 Multi Cap Growth 15.34 0.59 12.10American Funds Wsh A 66.967 Large Cap Value 11.61 0.54 16.82SPDR Trust 1 65.204 S&P 500 Funds 11.43 0.51 14.67Dodge & Cox Stock 63.754 Large Cap Value 16.67 0.81 16.90PIMCO Tot Rtn Inst 59.472 Intmd Inv Grade 4.71 0.19 5.08American Funds CIB A 58.440 MTAG 15.32 0.77 20.15American Funds CWGI A 57.848 GMLV 19.72 0.84 20.10

*Annualized. Through Thursday. Source: Lipper

Fund Scope: A Crisp Performance by Mid-Cap ValuezMid-cap value funds are up 16.38%, on average, in the past year, according to Lipper, the

fund-tracking arm of Reuters. That’s ahead of the S&P 500’s 12.06% gain over that stretch.

These funds have a three-year annual gain of 16.55%. Top performers include BlackRock Mid

Cap Value, up 20.55%, and Allegiant Mid Cap Value, up 21.86%.

—Lawrence C. Strauss

Assets 1 Year 3 YearFund Name/Manager Phone Number Load (millions) Return Return*

Fidelity Lw-Prcd Stk 800-544-8544 None $37,397.7 17.45% 17.17%Joel TillinghastLord Abbett MC Val A 800-821-5129 5.75 6,853.6 11.10 16.14Von Der Linde/HansenJanus Mid Cap Value Inv 800-525-3713 None 5,184.5 16.50 16.46Robert H. PerkinsFidelity Lvrgd Co Stk 800-544-8544 None 4,560.8 19.54 23.40Thomas SovieroFranklin Val Bal A 800-632-2301 5.75 4,441.5 17.09 19.37Team ManagedVanguard Sel Value Inv 800-662-7447 None 4,326.5 20.31 18.97Team ManagedGoldman Mid Cp Val A 800-526-7384 5.50 3,686.9 17.26 19.21Team ManagedJP Morgan MC Val A 800-480-4111 5.25 3,294.9 17.08 16.27Simon/Fu/PlayfordH&W Mid Cap Value I 866-493-8637 None 3,097.6 17.04 19.11Team ManagediShares Russ MCV Idx 800-474-2737 None 2,753.1 20.24 20.08O'Connor/Leung

*Annualized. All data through Thursday. Source: Lipper

56 B A R R O N ' S December 11, 2006