This week it’s riding high having recovered all losses and made some notable gains. In such volatile times you need a strong resolve. We believe we have identified a number of fund managers with such a resolve.
When we analysed our Best of British list of the top 25 UK fund managers and categorised their funds, it was clear a number of them run what we would call “core” funds. These are funds that are in a safe pair of hands, managed by an experienced fund manager and which can sit at the heart of a balanced portfolio.
Following the strong rises in the UK stock market over the summer some investors have been taking profits, causing market dips in the short term. This serves as a reminder that markets never go up (or down) in a straight line. There is still uncertainty, although we may have more clarity when the Chancellor makes his Autumn Statement on 23 November 2016.
When markets are unpredictable investors can get nervous. At such times these are exactly the types of managers you may want to turn to. These are typically industry veterans who can be relied upon to stick to their process through market ups and downs, riding out difficult times to deliver long-term outperformance. While value and growth managers perform differently at different times, over the long term quality comes to the fore.
Managers such as Alastair Mundy, who runs Investec UK Special Situations have been there, seen it and done it over many years and several market cycles (you can find out more about his fund here). Even within this category distinct styles exist. There are managers that focus on value (cheap companies) and those that have more of a bias towards profit growth.
In the current climate, we can see value funds have led the way even though they underperformed their growth counterparts over the previous few years.
Past performance is not a reliable indicator of future returns
Source: Bloomberg
Other managers of core funds in our Best of British list are Michael Lindsell & Nick Train, who run CF Lindsell Train UK Equity, John Wood, manager of JOHCM UK Opportunities, James de Uphaugh & Chris Field, co-managers of Majedie UK Equity, AXA Framlington UK Select Opportunities manager Nigel Thomas, Richard Buxton, manager of Old Mutual UK Alpha, Derek Stuart, who runs Artemis UK Special Situations, Stephen Adams, who manages Kames UK Equity and JOHCM UK Growth manager Mark Costar.
The chart below shows value funds in green, growth funds in blue and style agnostic funds in light blue. Note Lindsell Train UK Equity has outperformed largely due to its high exposure to consumer staples (see end of article for five years past performance).
Past performance is not a reliable indicator of future returns
Source: Morningstar Direct as at 31st August 2016. Total returns in GBP.
You can find out more about each of the funds run by core managers, below. Also, don’t forget to check the Best of British Fund Managers list to find out where they ranked.
Find out more about the CF Lindsell Train UK Equity fund:
Find out more about the JOHCM UK Opportunities fund:
Find out more about the Majedie UK Equity fund:
Find out more about the AXA Framlington UK Select Opportunities fund:
Find out more about the Old Mutual UK Alpha fund:
Find out more about the Artemis UK Special Situations fund:
Find out more about the Kames UK Equity fund:
Find out more about the JOHCM UK Growth fund:
Find out more about the Investec UK Special Situations fund:
Five-year performance of core Best of British funds
Remember that each fund is unique and hence exposed to different levels of risk. Some are relatively low risk, whilst others can be very risky and those will only be appropriate for more sophisticated investors.
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