The funds all have at least two of the top performing stocks in 2014 from the FTSE 100 and FTSE 250 in their top ten holdings.
UK equities have performed better in the mid cap space compared to the large and mega cap space since the beginning of 2014, carrying on from a stellar year for the asset class in 2013.
The FTSE 100 is down 0.45 per cent since the start of the year compared to a rise in the FTSE 250 of 3.02 per cent.
Axa Framlington UK Mid Cap and Marlborough UK Multi Cap Growth are the only funds to hold both of the two best performing FTSE 100 stocks of the first quarter of 2014 - Ashstead Group and Sports Direct – in their top ten holdings.
Ashstead Group, which rents out construction equipment, generates a large majority of its revenues from the US. It has risen 30.5 per cent since the beginning of the year, the highest gain in the index.
Retailer Sports Direct was the second best performer over the same period, rising 28.2 per cent. Before the start of the year it was listed on the FTSE 250.
Other top performing stocks include Next, Easyjet, Weir Group and Barratt Developments from the FTSE 100.
Source: FE Analytics
The companies are broadly in line with the best performing sectors in UK equities in 2014. The FTSE General Retailers is the best performing sector, which rose 15.46 per cent. The FTSE Construction and Building Materials is the second best performing sector. It rose 11.2 per cent over the same period.
The £71m AXA Framlington UK Mid Cap fund is managed by Chris St John with FE Alpha Manager Nigel Thomas as deputy manager and is a top quartile performer over one and three years.
St John told Trustnet in July 2013 he was tipping Ashstead and Sports Direct as mid cap stocks set for sustained growth.
The Ashstead Group stock is very popular with managers with 31 other funds holding it in their top ten including Henderson UK Smaller Companies, Old Mutual UK Mid Cap and Artemis UK Growth.
Three other funds have Sports Direct in their top ten, Old Mutual Global Best Ideas, Odey Opus and Schroder UK Mid 250.
The £98.4m Marlborough UK Multi Cap Growth fund is managed by FE Alpha Manager Richard Hallett and is a top quartile performer over one, three and five years.
Although it has benefitted from its holding in in Ashtead and Sports Direct, it has recently been hit by a 26 per cent fall in another top ten holding, ASOS.
Since the start of March ASOS’s share price has been falling after it first revealed heavier-than-expected capex costs which have weighed on profits.
However, Hallett has still managed to make money over this period.
In fact both the Marlborough fund and Axa Framlington fund have outperformed their sector and benchmark in 2014, returning over 7.5 per cent compared to an average return in the IMA UK All Companies of 1.19 per cent and rise in the FTSE All Share of 0.14 per cent.
Performance of funds vs sector and benchmark since 1 Jan 2014
Source: FE Analytics
Twelve other fund have ASOS in their top ten holdings, including Harry Nimmo’s top-performing Standard Life UK Smaller Companies fund, Baillie Gifford UK Equity Alpha and British Smaller Companies.
African Barrick Gold is the best performing on the FTSE 250 index in 2014 so far, having risen 41.34 per cent.
The only fund to have the stock as a top 10 holding is R&M UK Equity Unconstrained, which has 2.9 per cent in the company.
The gold miner has seen its share price bounce back after it slumped in throughout most of 2013.
Miton’s George Godber recently told Trustnet the stock is his favourite contrarian play at the moment.
Performance of stocks vs index since 1 Jan 2014
Source: FE Analytics
The five crown rated R&M UK Equity Unconstrained fund is managed by FE Alpha Manager Daniel Hanbury.
The £13.6m fund is a top quartile performer over one and three years. Over three years it has returned 62.63 per cent.
It had a bumpy start to the year but has bounced back to return 3.57 per cent, beating its sector and benchmark.
Performance of fund vs sector and benchmark since 1 Jan 2014
Source: FE Analytics
Schroder UK Mid 250 has a 5.23 per cent holding in Pace, which is the second best performer in the FTSE 250 in 2014 so far. The fund also has a position in Sports Direct, which was until recently a 250 company.
Pace manufactures technology for the broadcast and broadband industries. It has risen 40.54 per cent since the beginning of the year
Six other funds have Pace as a top ten holding including Brown Shipley UK Flagship, Old Mutual UK Smaller Companies Focus and Barclays UK Lower Cap.
Other top performing stocks in the FTSE 250 include F&C Asset Management, Bodycote and WHSmith.
