Japan blue-chip champion joins the top team - Premier League Feb 15 update
3rd February 2015 09:51
Reassuringly, despite the recent pick-up in volatility within global markets, we have had to make very few changes to our Premier League line-up this quarter.
Only the Japan, mixed investment 40 to 85%, and sterling strategic bond sectors are welcoming new champions, while our UK smaller companies fund choice has been switched due to a change in management.
Money Observer's Premier League highlights the best-performing open-ended funds and managers from each of the Investment Association's (IA's) 15 most popular fund sectors.
To gain a place in the league, a fund must have delivered first-quartile returns within its sector in each of the past three years, have had the same manager at the helm throughout that period and have more than £10 million of assets under management.
Powerhouses
In each of our quarterly reviews, a fund's most recent annual return must also be in the first or second quartile.
Of those funds selected in our annual review in November, only three failed to make the cut this time around: , and , all of which fell out of the first or second quartile of their sectors in the year to 1 December 2014.
In the Japan category, is our new champion thanks to its sector-busting 9% return in the year to 1 December, alongside an outstanding long-term record that has seen it return over 200% in 10 years compared to less than 45% from the IA Japan sector.
The fund has been managed by the highly regarded Chris Taylor since 2005, and unlike its predecessor Legg Mason Japan Equity is invested heavily in the traditional powerhouses of the Japanese economy: industrial and engineering blue chips, including Toyota, Mitsubishi and Toshiba.
Ethical outperformer
Replacing Practical Investment in the mixed asset 40 to 85% shares category is , the second fund with an ethical/socially responsible mandate to make it into our league, alongside Audrey Ryan's in the mixed asset 20 to 60% shares category.
Managed by Mike Fox since 2009, the fund is the best performer in the mixed asset 40 to 85% shares sector over three years, returning 61% compared to just 33% from the sector.
Royal London - which manages the fund - says it applies both negative and positive screens to the portfolio, excluding firms involved in areas such as arms and tobacco, while actively seeking out businesses that contribute positively to society or the environment. Its holdings include , , , brewers and , and .
is our new strategic bond choice, thanks to its strong 9.2% return in the year to 1 December in the face of torrid fixed-income markets.
Managed by the highly experienced Eric Holt, the £1 billion fund pays an impressive 7.1% yield - higher than any other fund in the strategic bond sector - and is rarely seen outside of the first or second quartile.
In a non-performance related move we have also had to say goodbye to , as manager Dan Hanbury has departed. Ex-Investec man Philip Rodrigs took the helm in September 2014.
Like Hanbury, Rodrigs boasts an excellent track record in UK smaller companies; however, the change means the fund is no longer eligible for our league.
In its stead we have Alex Wright's , which has returned 112% in the three years to 1 December, second only to our former champion.
Wright has managed the fund since 2008 and has a strong background in UK small and mid-cap companies - so much so that he was chosen as the successor of Anthony Bolton's in 2012.
Like all UK smaller companies managers, Wright may have a tough job on his hands this year as smaller companies show no sign of rallying from the lows of 2014, but his experience should hold him in good stead to lead the pack.
This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
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