New research from FundCalibre highlights 10 fund managers who have seen the strongest performance in beating every single rival fund in their respective fund sector since they started managing their funds.
When you invest in an actively managed fund you are paying for the stock-picking ability of the fund’s manager. It makes sense, therefore, to pay close attention to the track record of the manager of the fund you are investing in.
Sometimes this can be taken to excess, with the cult of the star manager, with investors piling into funds run by a fund manager currently in vogue, only to be disappointed when the fund’s performance does not live up to the hype.
New research from FundCalibre highlights 10 fund managers that have seen the strongest performance in beating every single rival fund in their respective fund sector since they started managing their funds. The top 10 is ranked by fund manager tenure.
The first is Marlborough Special Situations. Over the 22 years that Giles Hargreaves has served as its fund manager, it has provided a return of 2817.6%. In comparison, the average return for the UK Smaller Companies sector over the same period of time was 482.8%.
Early next year Hargreave will step back from the fund, and two other funds he co-manages: Marlborough UK Micro-Cap Growth and Marlborough Nano-Cap Growth. Although, he will continue to assist with the running of the funds.
Darius McDermott, managing director of FundCalibre, notes: “Marlborough Special Situations fund has a small and mid-cap focus and is managed by the astute and pragmatic stock picker Giles Hargreave.
“The process has held up well across a wide range of market conditions and the long-term track record of this fund is exemplary. Eustace Santa Barbara became co-manager in 2014 and will take over the fund next year.”
Next on the list is Alexander Darwall’s European Opportunities Trust. The trust, which has a focus on medium and larger European companies, has delivered a return of 727.6% since November 2000, when Darwall become manager of the trust. The European trust sector average return is 311.3%.
The other European fund in the top 10 is LF Miton European Opportunities. McDermott notes: “This fund takes a multi-cap approach to the Europe equity market, with a bias towards medium-sized companies. The mangers look for quality companies, with strong brands or clear competitive advantages.” Since current management took control in December 2015 it has returned 131.4% compared to a sector average of 41.6%.
In third place is respected China investor Martin Lau. Since December 2003 the fund he manages - First State Greater China Growth - has provided investors a return of 949.5%, roughly double the sector average of 463.4%. Meanwhile, Schroder Asian Alpha Plus, under the tenure of Matthew Dobbs, has returned investors 221.98%, double its sector average, of 105.2%.
The only bond-focused fund on the list is Jupiter Strategic Bond. Since coming under the management of Ariel Bezalel in June 2008, the fund has returned 132.6%, compared to a sector average of 75.46%.
McDermott notes: “Jupiter Strategic Bond is a flexible 'go-anywhere' fund that allows the manager considerable freedom to exploit opportunities across global bond markets – which he does very actively. Bezalel is quite cautious in his approach and tries to limit potential losses in tough markets.”
Other funds in the top 10 include Guinness Global Equity Income fund. This fund typically invests in 35 equal-weighted stocks. Co-managed by Matthew Page and Ian Mortimer, the fund has provided a return of 156.36% since December 2010 compared to 95.38% for the sector average. The fund was recently noted for having avoided (at the time of writing) seeing any dividend cuts or suspensions among the companies in its portfolio.
MI Chelverton UK Equity Growth is also highlighted, having provided a performance of 133.5% since James Baker took over in October 2014. That return stands way above the sector average of 26.79% over the same period.
Investor favourite Baillie Gifford Japanese Smaller Companies is also in the top 10. Managed by Praveen Kumar since December 2015, the fund has rewarded investors with a return of 111.2% compared to a 77.2% sector average return.
The final fund highlighted is LF Gresham House UK Multi Cap Income, which is managed by Ken Wotton. This is a concentrated multi-cap fund with a bias towards smaller companies. Measured from June 2017, when Wotton took over, the fund has returned just 20.6%. However, that stands out when compared to the generally woeful performance of the UK Equity Income sector, which provided investors with a loss of 11.3% over the same period.