Our list of 10 most popular funds continues to be dominated by ‘star’ fund managers and tracker funds.
The end of year is traditionally a time for investors to take stock and assess how their portfolio has fared in 2018. Once the winners and losers have been identified, it is a case of rebalancing, which ensures you avoid complacency creeping into a portfolio.
But, given that there has been a shortage of winners in 2018, investors will instead be focusing more on the laggards and hoping for a stronger showing next year.
Nonetheless, in terms of the most popular funds, the ‘star’ fund managers and tracker funds that usually populate our top 10 table each month continue to dominate, which is based on data provided by interactive investor, the parent company of Money Observer.
But Jupiter India is a new entrant to the list – a sign that investors are viewing India as offering up some value following a rough patch in 2018 owing to the high oil price, which has essentially been a tax rise for India’s energy-intensive economy. The strong dollar also didn’t help, pushing up the cost of India’s US-dollar denominated debt, while added to that the rupee has been notably weak.
All of the above headwinds have culminated in India’s market having a year to forget, with the performance of Jupiter India a case in point. Year-to-date the fund has dropped like a stone, down nearly 25%.
It is managed by Avinash Vazirani, who has more than 20 years’ experience under his belt. Rather than focusing on services exports as some foreign investors do, he believes India's long-term potential lies in its domestic economy and growing middle class.
Elsewhere, the only other movement in our top 10 has been CFP SDL UK Buffettology, climbing from 10th to fifth place. The UK stockmarket is currently loathed by both domestic and international investors, who have on the whole been giving UK equities the cold shoulder since June 2016 when the referendum on EU membership took place.
This is reflected in our top 10, with only two funds having a UK focus, the other being Lindsell Train UK Equity, managed by Nick Train.
Instead, investors are favouring a global approach. Once again Fundsmith Equity, run by Terry Smith, takes top position, followed by Lindsell Train Global Equity, co-managed by Train and Michael Lindsell.
The other global fund in the top 10 is Baillie Gifford Global Discovery, despite the fact that it is one of the heaviest fallers of all funds over the month, losing 13.7%.
Completing the seven active funds in the top 10 is Baillie Gifford American – another exceptionally heavy faller in November – which has almost a third of its portfolio in tech companies. Apple is the top holding, accounting for nearly 10% of the fund.
Their low cost also catches the eye, with each of the five funds in the range displaying an ongoing charge figure of 0.22% (though of course this does not include trading costs). In contrast, an actively managed multi-asset fund tends to charge between 1% and 1.25%. In some cases, particularly for multi-manager funds which buy funds rather than equities and bonds, the annual charge is even higher.
Exiting the top 10, following Jupiter India’s inclusion, is another specialist fund: Janus Henderson Global Technology.
|Rank||Fund||IA sector||Change since September||*1 year (%)||*3 years (%)|
|2||Lindsell Train Global Equity||Global||--||15.5||82.4|
|3||Vanguard LifeStrategy 80% Equity||Mixed Investment 40%-85% Shares||--||1.7||36.1|
|4||Baillie Gifford American||North America||--||27.2||100.7|
|5||CFP SDL UK Buffettology||UK all companies||5||10||49.8|
|6||Baillie Gifford Global Discovery||Global||--||20||72.1|
|7=||Vanguard LifeStrategy 60% Equity||Mixed Investment 40%-85% Shares||--||1||28.5|
|7=||Jupiter India||Specialist||New entry||-21.3||18.8|
|9||Vanguard LifeStrategy 100% Equity||Flexible||-4||2.4||44.1|
|10||Lindsell Train UK Equity||UK all companies||-1||3.9||38.7|
Note: *Performance data is to 5 December 2018.