The masters of UK equity
FE Trustnet reveals the top-performing fund managers in the UK equity space over the long-term.
By Mark Smith, Senior Reporter, FE Trustnet
Thursday June 21, 2012
, John McClure and Jan Luthman join the likes of Neil Woodford and Tom Dobell in the top-10 list of managers who have returned the most in the UK Equity Income and UK All Companies sectors over 10 years.
Andrew C Green, Stephen Bailey and Paul Mumford also make the elite list, while Giles Hargreave misses out by a matter of days – he celebrates managing Marlborough UK Leading Companies for a decade on 1 July.
Masters of UK equity
Source: FE Analytics
While Neil Woodford’s Invesco Perpetual Income
and High Income
and Dobell’s M&G Recovery funds need little introduction, some of the others aren't as well known.
FE Alpha Manager Mark Hall, for instance, has been managing the £159.5m Franklin UK Select Growth fund since it launched in September 2001. Data from FE Analytics
shows it has returned 115.62 per cent over the last decade, compared with 66.39 per cent from the average UK All Companies fund.
However, recent performance has not been as convincing. The fund has underperformed its FTSE All Share benchmark over the last three years.
With 18 per cent of assets invested in oil and gas producers and 9 per cent in miners as at 30 April 2012, Hall has made a major play on cyclically exposed sectors.
five crown-rated Cavendish Opportunities
fund is one of the hidden gems of the UK growth space.
Top-quartile returns over three, five and 10 years prove that the manager’s strategy works. Exposure to more economically sensitive sectors such as house building and oil and gas producers means that the fund tends to outperform in rising markets and lag the peer group in falling ones.
FE Alpha Managers Jan Luthman
and Stephen Bailey
are likely to become more widely known now that Liontrust has acquired their services.
Their top-performing equity income fund, now called CF Liontrust Macro UK Growth
, should benefit from the asset managers' superior distribution channels and marketing power.
It is one of the most consistent performers in the entire IMA universe, beating the sector average in eight of the last 10 calendar years.
Fellow FE Alpha Manager John McClure is best known for his top-performing Unicorn UK Income fund where he has proved that dividend investing, more traditionally associated with stable blue chips, is just as effective when applied to smaller companies.
His £5.5m growth fund, Unicorn Free Spirit, has also performed strongly. According to FE data, it has returned 143.56 per cent over the last decade.
Performance of funds vs sector and index over 10-yrs
Source: FE Analytics
Andrew C Green’s £126.8m GAM UK Diversified fund has been the second-best performing UK equity fund over the last 15 years, with returns of 347.65 per cent.
By comparison the average UK All Companies fund has returned 92.65 per cent over the period.
Green invests with a top-down approach and typically holds around 100 stocks.
At a company level, the manager seeks stocks that have undergone significant changes, for example the disposal of a loss-making division, a management change or a dividend cut, and looks for a catalyst that has the potential to close the valuation gap.