Moneywise Fund Awards 2015: part 2

Published by Philip Scott on 02 December 2015.
Last updated on 04 December 2015

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WINNER: Invesco Perpetual European Opportunities Fund

HIGHLY COMMENDED: Jupiter European Income Fund

While Europe has had no shortage of negative headlines this year on the back of sluggish economic growth, ultra-low inflation and indeed the whole ‘Grexit’ issue, investors are still piling in. Numbers from the trade body Investment Association show that since the start of the year to the end of September almost £2.6 billion has collectively been invested into Europe (ex-UK) funds. The exuberance is chiefly as a result of the European Central Bank’s ¤60 billion-a-month electronic money printing or quantitative easing (QE) programme, a strategy which helped secure robust market gains in both the UK and US.

Despite the continent’s fiscal woes, many fund managers are delivering consistently robust returns.

Taking top place once again is the Invesco Perpetual European Opportunities fund. Connolly says: “The fund benefits from the stock-picking skills of an experienced manager in Adrian Bignell. He identifies investment themes and then runs with them, in particular benefiting from finding turnaround recovery and undervalued companies.” Jupiter European Income takes the highly commended position this year.


WINNER: Stewart Investors Asia Pacific Leaders Fund

HIGHLY COMMENDED: Baillie Gifford Pacific Fund

Given the Asia Pacific (ex-Japan) sector’s proximity to emerging markets, it has been far from covered in glory this year with many funds enduring losses. However, a number of funds have shone through over the long term. First State Investments created a subsidiary business in early November to manage some of its funds and one of those is our category winner – the Stewart Investors Asia Pacific Leaders fund, run by investment veteran Angus Tulloch. It’s worth noting, however, that Tulloch is due to step down as manager by July 2016.

McDermott says: “The First State Stewart team has a strong process and an excellent boutique-style culture. When combined with the experience of Angus Tulloch and a skilled team with a presence throughout Asia, it is not surprising that this fund has generated exceptional performance.”

Taking second place is the Baillie Gifford Pacific fund, run by Roderick Snell. Connolly says: “The manager is not afraid to take risks, as evidenced by the fund currently being 86% invested in a combination of China, India, South Korea and Taiwan. But the strong performance of the fund makes up for the volatility.”


WINNER: Legg Mason ClearBridge US Large Cap Growth Fund

HIGHLY COMMENDED: Old Mutual North American Equity Fund

Even the mighty US could not shield itself from the heavy turbulence experienced by markets this year, with its benchmark blue-chip index down by some 3% since the start of 2015. Naturally, the North America fund sector echoed the index’s pain, with the typical fund off by a steeper 6% for the period. But as the world’s largest economy, it is hardly a region investors can, or will, ignore. In pole position this year is the Legg Mason ClearBridge US Large Cap Growth fund.

Haynes says: “Although ClearBridge may not be known to many UK investors, it is an American company that manages more than $100 billion. This fund has built up an impressive record through investing in a high-conviction portfolio of global leading US-based companies.”

Last year’s silver medal winner, Old Mutual North American Equity, managed by Ian Heslop, once again steps up to claim the commended position.

Lowcock says: “Heslop uses data and statistical analysis to identify opportunities, which was reviewed following the financial crisis to avoid value traps. There has been evidence the change in process has worked with the fund- performing better during volatile markets. The focus on technology and biotech will have helped performance over the past couple of years.”


WINNER: Kames Ethical Cautious Managed Fund

HIGHLY COMMENDED: Standard Life Investments Dynamic Distribution Fund

Mixed investment funds are one-stop shops for retail investors, typically offering access to a variety of asset classes all within a single portfolio. In this sector, the equity portion must account for between 20% to 60% of a fund’s assets. Kames Ethical Cautious Managed takes the top spot once again this year. This fund combines the strength of Kames’ UK equity and fixed- interest teams, and adopts a strict ethical criteria. Just over 50% of the fund is invested in shares, with some 41% in bonds and the remainder in cash. Connolly asserts that Audrey Ryan is well regarded in the ethical investment arena, while Ian Buckle “is a safe pair of hands to manage the fixed-interest exposure within the fund”. Connolly says: “This approach has worked well, although the comparative performance of ethical funds is heavily influenced by what they are not allowed to hold as well as what they invest in.”

Taking second place is Standard Life Investments Dynamic Distribution, which Lowcock describes as very much focused “on long-term growth through income and capital returns”. He adds: “Unlike other distribution funds where capital preservation and beating inflation is an important consideration, this fund is heavily invested in shares with exposure to bonds and other assets.”

Read part 1 of our 2015 Fund Awards here.

Read part 3 of our 2015 Fund Awards here.

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