Sound Shore Fund

March 31, 2008

Dear Shareholder:

The Sound Shore Fund ended March 31, 2008 with a net asset value of $32.67 per share. The first quarter total decline of -8.43% was ahead of the Standard & Poor’s 500 Index (“S&P 500”), which dropped -9.44%, and behind the Dow Jones Industrial Average (“Dow Jones”), which was down -7.00%.

We are required by the SEC to say that: Performance data quoted represents past performance and is no guarantee of future results. Current performance may be lower or higher than the performance data quoted. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than original cost. The Fund’s 1, 5, 10, and 15-year average annual total returns for the period ended March 31, 2008 were -5.88%, 13.81%, 5.38%, and 10.84%, respectively. As stated in the current prospectus, the Fund’s annual operating gross expense ratio is .93%. For the most recent month-end performance, please visit the Fund’s website at www.soundshorefund.com.

Global stock markets sold off broadly in the first quarter as the economy weakened further and as the capital markets’ deleveraging process intensified. Deteriorating housing and other economic data appeared to be comparable to past recessions, especially some of the steeper ones. Meanwhile, liquidity concerns heightened with the mid-March run on Bear Stearns, whose prime brokerage clients apparently withdrew $100 billion, or 25 percent, of their balances in less than a week. Parenthetically, a couple of those larger clients were reported to have been shorting Bear Stearns stock. As many investors were shedding financial assets, they piled into materials, driving up prices for crude oil, gold, industrial metals, and agricultural products, many to record highs. Despite the gloom, however, the quarter actually ended on a better note after the US Federal Reserve lowered its target Federal Funds rate by an additional 0.75%, and also provided direct funding access for major investment banks for the first time since the 1930s.

Two of Sound Shore’s better first quarter performers, Boston Scientific Corp. (Boston) and Comcast Corp. (Class A, Common Stock) made solid rebounds after lagging in 2007. Cardiac device manufacturer Boston was up 11% after firm-wide cost cutting efforts yielded better than expected fourth quarter earnings. Further, end-market demand for drug coated stents, its core product, appeared to improve especially versus low expectations.

Cable leader Comcast, meanwhile, unexpectedly forecast higher free cash flow and lower capital spending for 2008 leaving financial room for the company to initiate its first-ever annual dividend and a $7 billion share repurchase plan, all of which helped the stock. Given a 6.5 times 2008 cash flow valuation and estimated operating income growth of more than 10%, Comcast shares appear attractively valued.

As an interesting offset, our two biggest laggards in the first quarter, CIGNA Corp. and Flextronics International, Ltd. (Flextronics), were among our stronger performers in 2007. Health insurer CIGNA declined 24% after a large competitor, WellPoint, reported worse than expected medical cost trends. CIGNA’s business, by contrast, does not appear to be facing the same cost pressures and is profitably taking market share. As well, capital allocation at the company continues to include healthy share repurchases – CIGNA has reduced its shares outstanding by one-third since 2003. We used the pullback in the stock to add to our long-held position.

Similarly, Flextronics was down primarily due to lower guidance at one of its larger electronics manufacturing peers. However, Flextronics is actually gaining market share and profitability at the expense of its competitors. Fueled by significant new customer wins over the past two years, we believe Flextronics captured virtually all of the industry’s revenue and profit growth in 2007 and also earned more than its top 5 US competitors combined. While Flextronics’ progress could be impacted by any slowdown in the electronics industry, their global diversification may help to dampen the effect during this cycle. Valued at 9 times 2008 consensus earnings and with significant synergies from its recent Solectron acquisition still to be realized, we used the pullback in the first quarter to increase our investment.

The reset of credit markets has removed leverage from the equity market as well. The S&P 500 declined by almost 20% from its third quarter 2007 peak, while 2008 consensus earnings estimates have been reduced about 10% and still project reasonable growth. As a result, the market’s 2008 price to earnings ratio (P/E) has contracted to less than 15 times. This more risk averse backdrop may provide us with better investment opportunities particularly given our emphasis on understanding the earnings and franchise quality of the companies in which we invest.

As always, many thanks for your investment alongside us in Sound Shore.

Sincerely,

SOUND SHORE FUND

Harry Burn, III
John P. DeGulis
T. Gibbs Kane, Jr.

Co-Portfolio Managers

Fund returns assume the reinvestment of all dividend and capital gain distributions. The S&P 500 is an unmanaged index representing the average performance of 500 widely held, publicly traded, large capitalization stocks. The Dow Jones consists of 30 stocks that are considered to be major factors in their industries and that are widely held by individuals and institutional investors. It is not possible to invest directly in an Index.

Price to earnings (P/E) ratio is the value of a company’s stock price relative to company earnings. Free cash flow yield is the overall return evaluation ratio of a stock, which standardizes the free cash flow per share a company is expected to earn against its market price per share. Percent of net assets as of 3/31/08: Bear Stearns: 0.00%; Boston Scientific Corp.: 3.24%; CIGNA Corp.: 3.14 %; Comcast Corp. (Class A, Common Stock): 3.14%; Flextronics International, Ltd.: 3.13%; and Solectron: 0.00%.

The Fund may invest in medium-sized companies, which involves greater risk than investing in larger, more established companies such as increased volatility of earnings and prospects, higher failure rates, and limited markets, product lines or financial resources.

The views in this letter were those of the Fund managers as of 3/31/08 and may not necessarily reflect their views on the date this letter is first published or anytime thereafter. These views (i) are intended to assist shareholders in understanding the Fund’s present investment methodology and (ii) do not constitute investment advice. This letter must be preceded or accompanied by a current Fund prospectus. Distributed by Foreside Fund Services, LLC.