According to the latest FE Trustnet poll, 42 per cent of over 1,200 respondents selected the group over rivals M&G, BNY, Aberdeen and Threadneedle.
The five groups were chosen as they have the most amount of retail money under management, according to the IMA.
Invesco was far and away the most popular choice, with M&G a distant second, taking 19 per cent of the vote.
Huge players in the market such as Fidelity, Schroders and Jupiter were not included in the study and could well have challenged; however, given the margin of Invesco’s win, few could argue that Invesco’s range is held in high esteem by financial advisers and private investors.
Looking at the numbers, Invesco has been a standout performer across a number of different areas.
According to FE Analytics data, 30 of the 43 funds under the management of Invesco Perpetual Fund Managers and Invesco Asset Management with a long enough track record – or 70 per cent – are top quartile performer over three years.
If you include first and second quartile funds the figure jumps to 91 per cent.
To put this another way, only four Invesco Perpetual funds have underperformed their sectors over the period.
When looking at first and second quartile performer, Invesco’s figure for five years is 83 per cent, and for 10 years is 84 per cent.
Source: FE Analytics (to 22/08/2014)
The study didn’t include funds that sit in IMA Specialist, IMA Targeted Absolute Return, IMA Unclassified or the IMA money market sectors, where sector comparison is all but meaningless.
Ten Invesco funds are top-quartile performers in their sector over three, five and 10 year periods, including Invesco Perpetual UK Strategic Income, Hong Kong & China, Managed Growth and Monthly Income Plus.
The equity equities franchise dominates Invesco’s business in terms of assets.
The eight funds across the IMA UK All Companies and IMA UK Equity Income sectors have combined AUM of over £22bn.
All are either first or second quartile performers over three, five and 10 years, though have very differing risk profiles.
The likes of Invesco Perpetual High Income tends to perform strongest in falling or flat markets for example, while UK Aggressive takes much punchier bets, and is therefore capable of significant periods of under- and outperformance.
Performance of funds and index over 10yrs
Source: FE Analytics
The group is far from a one trick pony however. Invesco has at least one first or second quartile fund across 19 IMA sectors. While few in number, there have been some disappointing performers.Invesco Perpetual Global Bond has been third quartile over all three, five and 10 years, while Invesco Perpetual Japanese Smaller Companies and Invesco Global Technology are bottom quartile performers over all three time periods.
It’s also worth pointing out that Invesco have little presence in the Property or North American sectors.
Until recently, absolute return was also lacking an option from Invesco Perpetual, though the group put this right last September with the launch of the Global Targeted Returns fund.
The fund, which has already attracted over £400m, recruited David Millar, Dave Jubb and Richard Batty from Standard Life, and is a direct rival to the £21bn GARS fund.
It has started strongly, and head of retail at Invesco Perpetual Ian Trevers told FE Trustnet in a recent interview that he expects it to be one of the highest growth areas for the group in the coming years.
The group’s dominance is also backed up by the number of funds with a high number of FE crowns.
Of the 48 Invesco funds that qualify for FE Crown Fund ratings, 28 – or 58 per cent – have either four or five crowns.
Among the lesser-known of these include Invesco Korean Equity, Invesco Perpetual Asian Equity Income and Invesco Perpetual Global Opps.
Invesco fared well in the latest rebalancing of the FE Group Ratings as well, gaining an outstanding in both UK Equities and Mixed Assets.
M&G trumped its rivals on this measure however, gaining an outstanding in Global Equity, UK Fixed Income and International Fixed Income.
The number of FE Alpha Managers is less of a strong point however.
Thanks to Woodford’s exit, Invesco Perpetual has just four top-rated managers: Mark Barnett, Michael Matthews, Stephen Anness and Martin Walker.
Groups such as Jupiter and Henderson fare much better, with nine and six FE Alpha Managers, respectively.
Gavin Haynes, managing director of Whitechurch Securities, says that he isn’t surprised that Invesco topped the poll. While Woodford’s exit was a big blow to the business – Invesco Perpetual Income and High Income have seen combined outflows of £7bn over the past 12 months according to FE Analytics – Haynes says this has given other managers a platform to shine.
“A lot of the focus was put on Woodford while some of the other managers were overlooked,” he said.
“It’s certainly a big blow, but it has taken the emphasis off of the equity income desk. Obviously they are very strong in fixed interest, and also in global markets as well. The European team are starting to put some good numbers together.”
Haynes points out that a lot of the past performance can be attributed to Woodford – he not only ran the UK equities team, but also had a hand in the equity portion of Invesco Perpetual Monthly Income Plus and Distribution.
He says it remains to be seen whether Barnett and Ciaron Mallon will be able to replicate Woodford’s success, but says that the firm is better prepared to cope with a star managers’ departure than other groups.
FE Trustnet will write an article looking at the groups that are most at risk of a star manager departure in an article early next week.
Daniel Lockyer, a fund of funds manager who runs the £30m PFS Hawksmoor Distribution fund, rates Invesco Perpetual as one of the strongest outfits in the UK, but thinks that overall Jupiter is the group to beat.
“Invesco Perpetual absolutely have some very good funds and would certainly be in my top-five, but when pushed I would have to go with Jupiter,” he said.
“Invesco is best known for their UK equity portfolios and the new GARS-rival is an interesting addition. Obviously they have a great bond franchise as well.”
“Jupiter has a big presence in global equity, and Ariel Bezalel is doing a very good job on the bond size. Absolute return is a stronger area now with James Clunie joining from SWIP. I also have a lot of respect for the Merlin team.”
