Six of the 10 best-selling funds on the platform have an income focus, with two headed up by star manager Neil Woodford. Of the five emerging market portfolios on the list, three are pure growth plays, while two target a competitive level of income as well as growth.
FE Alpha Manager Tom Dobell’s M&G Recovery portfolio is the only one of the 10 that has neither an emerging market or income focus.
Ten best-selling funds of 2011/2012 tax year
| Fund |
IMA sector |
| Aberdeen Emerging Markets |
Global Emerging Markets |
| Invesco Perpetual Monthly Income Plus |
Sterling Strategic Bond |
| Newton Asian Income |
Asia Pacific ex Japan |
| Investec Monthly High Income |
Sterling High Yield |
| Invesco Perpetual High Income |
UK Equity Income |
| Neptune Russia & Greater Russia |
Specialist |
| Allianz RCM BRIC Stars |
Specialist |
| Schroder Asian Income Maximiser |
Asia Pacific ex Japan |
| Schroder Income Maximiser |
UK Equity Income |
| M&G Recovery |
UK All Companies |
Source: The Share Centre
Aberdeen Emerging Markets topped the list overall, thanks largely to a surge of inflows in the weeks leading up to its soft-closure in early April. The fund is no longer open to new money, meaning that investors will have to look elsewhere to gain exposure to the enduring emerging market story.
One alternative is the Newton Asian Income portfolio, headed up by the highly rated Jason Pidcock. As well as offering the potential for high growth, the fund, which was the third best-selling product of the season, is yielding significantly more than the average UK Equity Income vehicle. According to FE data, it currently has a one-year historic yield of 4.98 per cent.
Thanks to its focus on large cap dividend payers, the portfolio is one of the least volatile of its kind, and topped the sector during the down market of 2011.
Those with a higher-risk profile opted for Neptune Russia & Greater Russia and Allianz RCM BRIC Stars, which took sixth and seventh spot respectively.
"These two positions demonstrate the continuing acceptance and appreciation of the investment opportunities outside of the UK shorelines," said Sheridan Admans, investment research manager at The Share Centre.
"The Neptune Russia & Greater Russia fund offers investors access to a market rich in oil and gas reserves, however this is not the only investment opportunity sought by the very experienced management team."
"Allianz RCM BRIC Stars focuses on the four key countries that have been at the forefront of emerging market investment for the past several years: Brazil, Russia, India and China."
Performance of funds vs benchmarks over 5-yrs
Source: FE Analytics
FE Alpha Manager Robin Geffen’s Neptune Russia & Greater Russia portfolio has significantly outperformed its MSCI Russia Large Cap benchmark over three- and five-year periods. It has a total expense ratio (TER) of 1.85 per cent and a minimum investment of £1,000.
Michael Konstantinov’s Allianz RCM BRIC Stars fund has performed in line with its MSCI BRIC benchmark over three years, but it has underperformed by 29 per cent over a five-year period. With a TER of 1.94 per cent it is slightly more expensive than Geffen’s portfolio. The fund has a minimum investment of £500.
Meagre global growth and various macro headwinds have pushed many investors into higher-yielding portfolios – namely the Invesco Perpetual Monthly Income Plus, Investec Monthly High Income, Schroder Asian Income Maximiser and Schroder Income Maximiser funds. All four of these have a one-year historic yield of more than 6.5 per cent at present.
Invesco Perpetual High Income and M&G Recovery – two of the largest and most established funds in the entire IMA unit trust and OEIC universe – were unsurprisingly popular with ISA investors again this year. With 10-year returns of 125 and 133 per cent respectively, these are two of the best-performing UK equity funds of the last decade.