June's 10 most-bought funds
Star manager Neil Woodford's first independent vehicle has reigned over Interactive Investor's top spot since its launch in June 2014. Investors continue to pile into the fund despite a swell of assets that has seen CF Woodford Equity Income grow from £1.6 billion at launch to over £6.1 billion as at 30 June.
Performance has so far warranted demand, with CF Woodford Equity Income outperforming every other UK equity income fund in the 12 months to 1 July with a return of over 17%.
The second-best selling fund on Interactive Investor in June was Axa Framlington Biotech, which has held onto the number two spot since December 2014.
Managed by biotechnology expert Linden Thomson, Axa Framlington Biotech has defied those forecasting the end of a two-year rally in biotechnology stocks, returning close to 60% in the year to 1 July and more than 20% since 1 January.
In third place was Fundsmith Equity - another perennial favourite with Interactive Investor clients that marks its fourth consecutive month in the top three. Managed by controversial manager Terry Smith, Fundsmith Equity has delivered strong returns since its launch in 2010 having benefited from a strong tilt towards US equities.
The first of four Vanguard tracker funds to feature in the top 10, Vanguard LifeStrategy 80% Equities was the fourth most-bought fund on Interactive Investor in June for the second consecutive month. The mixed-asset vehicle invests in a number of other Vanguard global trackers, helping to keep its costs low and its ongoing charges figure (OCF) at just 0.24%.
Low costs are the chief attraction of passive investment vehicles and one of the reasons behind their surging popularity in recent years.
However, proving that the best active managers can and do add value is Neptune UK Mid Cap, which moves up one place to be the fifth most-bought fund in June. Managed by UK medium-sized company expert Mark Martin, Neptune UK Mid Cap has consistently outperformed in even the most difficult markets, delivering top-quartile returns over one, three and five years to 1 July.
Over five years the fund is the best performer in the 275 fund strong UK all companies sector, delivering 192% compared to a sector average of just 80%.
Artemis Global Income was the sixth most-bought fund in June, falling one place from fifth in May. Managed by Jacob de Tusch Lec since its launch in 2010, the fund has notched up consistent first-quartile performance; over three years to 1 July it has returned 73.9%, making it the best performer in the global equity income sector over the period.
Vanguard LifeStrategy 100% Equities, Vanguard FTSE Developed World ex UK Equities Index and Vanguard FTSE UK All Share Index were the seventh, eighth and ninth most-bought funds in June, cementing the popularity of Vanguard's funds with Interactive Investor customers.
Neil Woodford's former charge, Invesco Perpetual High Income, was the 10th most-bought fund last month, for the second consecutive month, as Woodford's former protégé Mark Barnett continues to deliver strong performance.
This article was written for our sister website Money Observer
Also known as index funds, tracker funds replicate the performance of a stockmarket index (such as the FTSE All Share Index) so they go up when the index goes up and down when it goes down. They can never return more than the index they track, but nor will they lose more than the index. Also, with no fund manager or expansive research and analysis to pay, tracker funds benefit from having lower charges than actively managed funds, with no initial charge and an annual charge of 0.5%.
An interchangeable term for shares (UK) or stocks (US). Holders of equity shares in a company are entitled to the earnings and assets of a company after all the prior charges and demands on the company’s capital (chiefly its debts and liabilities) have been settled. To have equity in any asset is to own a piece of it, so holders of shares in a company effectively own a piece proportionate to the number of shares they hold. (See also Shares).