Manek Growth fund is the worst performing fund over the past three years and should be dropped like "a hot stone" from investment portfolios, according to Chelsea Financial Services' latest dog fund review.
In its latest 'RedZone' survey, which names and shames the worst performing funds, the IFA firm revealed Manek Growth managed to lose its investors more than 34% over the three-year period to 1 August 2012, compared with the average positive return of 33% in its sector.
Overall, it underperformed its sector by a whopping 68%.
Switch quickly
It is followed by UBS Smaller Companies and Allianz Global Eco Trends, which have underperformed their respective sector averages by 49% and 41% respectively.
However, across the board Scottish Widows managed funds come up worse, representing the highest number of bad-performing funds in the review.
Darius McDermott, managing director of Chelsea, says: "Our analysis, frankly, makes for pretty depressing reading and I can only urge anyone invested in these funds to consider whether they want to remain invested or switch as quickly as possible to a better fund.
THE TOP 10 FUNDS TO DROP
| POSITION |
FUND |
% UNDERPERFORMANCE IN SECTOR |
| 1 |
Manek Growth |
68.11% |
| 2 |
UBS UK Smaller Companies |
49.81% |
| 3 |
Allianz Global Eco Trends |
41.81% |
| 4 |
Barmac The Castleton Growth |
39.75% |
| 5 |
Neptune Japan Opportunities |
37.05% |
| 6 |
Standard Life Investments UK Opportunities |
31.31% |
| 7 |
SVM Global Opportunities |
30.1% |
| 8 |
JPM Cautious Total Return |
25.07% |
| 9 |
Templeton Global Emerging Markets
|
24.57% |
| 10 |
Fulcrum Global Diversified |
23.32% |
IFA
A financial adviser who is not tied to any financial services company (such as a bank or insurance company) and is authorised by the Financial Services Authority (FSA). They can advise on financial products to suit your circumstances. All IFAs have to give consumers the choice of paying by fees or commission and have to explain which would best suit the customer in that particular instance. Also, if commission is paid either by the client or the financial service provider recommended by the IFA, the IFA must disclose what that commission is.
Emerging markets
Generic, loosely-defined term for markets in a newly industrialised or Third World country that is in the process of moving from a closed economy to an open market economy while building accountability within the system. The World Bank recognises 28 countries as emerging markets, including Argentina, Brazil, China, Czech Republic, Egypt, India, Israel, Morocco, Russia and Venezuela. Because these countries carry additional political, economic and currency risks, investors in emerging markets should accept volatile returns. There is potential to make large profit at the risk of large losses.
