The popular vehicle has returned 25.14 per cent since its inception, outperforming the average fund in its sector by 18.19 per cent.
Performance of funds vs sector over 3-yrs
Source: FE Analytics
The fund’s benchmark, the LIBOR six-month index, has returned 6.33 per cent in this time.
Only four funds have beaten Munro’s fund during this time and, with the exception of the Henderson Credit Alpha fund, all of these are significantly more volatile.
With returns of 45.12 per cent, the CF Octopus Absolute UK Equity fund has the best returns since May 2008; however, the fund is the most volatile of its kind and has one of the highest FE Risk Scores. The bulk of the fund’s returns came in 2009, but in the subsequent 12-month period it was the worst-performing vehicle of its kind, with losses of 8.56 per cent.
However, the Standard Life GARS fund is one of the very few that has managed to break even in 2009, 2010 and so far in 2011.
Risk/return of top-5 Absolute Return funds since May 2008
| Name | Returns (%) | FE Risk Score |
| CF Octopus Absolute UK Equity | 46.0 | 58 |
| Henderson Credit Alpha | 38.1 | 13 |
| Schroder ISF Emerging Market Debt Absolute Return |
36.8 | 37 |
| Newton Real Return | 25.7 | 43 |
| Standard Life GARS | 25.1 | 27 |
Source: FE Analytics
Newton Real Return and Schroder ISF Emerging Markets Debt Absolute Return have also proven to be riskier investments than Munro’s fund. Ian Stewart’s Newton fund currently has 57 per cent of its portfolio invested in the equity market, which is exceedingly high for an Absolute Return fund.
Stephen Thariyan’s Henderson Credit Alpha has the best risk-adjusted returns in the sector, but with a minimum investment of £10m it is not an option for the majority of retail investors.
This performance will come as a relief to many private investors and IFAs, who backed Munro’s fund even before it reached its three-year anniversary earlier this year. According to FE Analytics data, it has attracted £3.37bn in the last 12 months, which is more than any other fund in the IMA unit trust and OEIC universe.
An FE Trustnet article back in April reported that Standard Life GARS was the second-best selling fund during the 2011 ISA season.
Director of SG Wealth Management Neil Shillito, who has recently added the fund to his portfolio, said: "We like the Standard Life GARS fund because of its multi-asset, multi-strategy aspect. It invests in a diverse range of derivatives, currencies, equities, commodities and much more. Very few Absolute Return funds have this kind of expertise in so many areas."
"It comes with a very good pedigree and is used by the Standard Life team as a key part of their pension," he added.
The multi-asset team that Munro heads up comprises of more than 20 investment professionals with an average of 14 years’ industry experience.