The uncertain market conditions that faced investors during 2019 saw professional investors continue to look outside of home shores and towards familiar names such as Vanguard, Fundsmith and Lindsell Train, Trustnet analysis suggests. 
Events in the last year such as Brexit and the UK general election, the US-China trade war, tension in the Middle East and central banks committing to easier monetary policy sway markets presented investors with a range of challenges to navigate.
However, 2019 turned out to be a strong one for equity markets with the MSCI AC World index making a total return of 21.52 per cent (in sterling terms). The FTSE All Share wasn’t too far behind with a 19.17 per cent total return, but it had been underperforming peers in the US and Europe for the bulk of the year before rallying hard when the Conservatives won the general election.
Against this backdrop, the underlying research trends of the financial advisers, wealth managers and other professionals using FE Analytics show they were paying far more attention to global funds in 2019.
The chart below – which shows the change in research activity in 2019 compared with the previous three years – lays bare just how much more attention was on the IA Global sector last year.
Source: FE Analytics Market Intel Tool
Between the start of 2016 and the end of 2018, funds in the IA Global sector accounted for 7.5 per cent of all FE Analytics research into the Investment Association universe but this grew to 9.3 per cent during 2019.
This trend was consistently seen across the year and was down to investors looking outside of domestic investments because of Brexit and political uncertainty. It could be that this reverses in 2020, now the Conservatives have won a convincing majority and a mandate to ‘get Brexit done’, and more attention started to shift to the UK in the closing weeks of 2019.
IA Mixed Investment 40-85% Shares, IA Volatility Managed, IA Global Emerging Markets Bond and IA Flexible Investment also increased their shares of research on FE Analytics last year.
However, sectors that were getting less attention in 2019 when compared with recent years include IA Unclassified, IA Targeted Absolute Return and IA UK Equity Income.
When it comes to individual funds, Vanguard’s LifeStrategy range continued to be favourites with professional investors. The multi-asset strategies, which are automatically rebalanced portfolios of underlying Vanguard trackers, have attracted persistent inflows since their launch in 2011.
Source: FE Analytics Market Intel Tool
Indeed, Vanguard LifeStrategy 60% Equity was the fund that witnessed the biggest individual growth in research activity in 2019.
Its Investment Association research share went from 0.1893 per cent to 0.3367 per cent across the year – an improvement of 0.1473 percentage points. Put in more simple terms, it was the 25th most researched fund on FE Analyticsover the three years to the end of 2018 but jumped into second place in 2019.
As the table above shows, four of the five Vanguard’s LifeStrategy funds are among the 25 funds with the biggest growth in research share last year. The remaining fund – Vanguard LifeStrategy 20% Equity – is in 26th place.
Of course, other familiar names can be seen above as well.
Reflecting the increased interest in global strategies, we see that Lindsell Train Global Equity and Fundsmith Equity have been more popular with professional investors in 2019. Fundsmith Equity remains the most heavily researched Investment Association fund on FE Analytics.
Both funds have established very strong track records as their quality-growth approach has been very much in favour during the post-crisis bull run, although this has come under pressure more recently as the value style started to outperform growth.
Despite UK funds losing ground to global strategies, there are some IA UK All Companies members that climbed up the research rankings last year.
CFP SDL UK Buffettology has been growing increasingly popular with professional and retail investors alike, thanks to a strong track record and an investment approach based on that used to great success by Warren Buffett.
The fund, which saw assets under management pass the £1bn mark in 2019, was the 266th most researched member of Investment Association in the three years to the end of 2018 but was in 39th place at 2019’s close.
Liontrust Special Situations, LF Lindsell Train UK Equity, Man GLG UK Income and TB Evenlode Income were also being researched more heavily by professional investors last year.
Source: FE Analytics Market Intel Tool
When it comes to the funds with the biggest falls in adviser research, ASI Global Absolute Return Strategies – or GARS – has come off worse. It has fallen from fourth place overall to 31st, despite it outperforming its average peer for the first time since 2015.
Jupiter European slipped from second place to fifth last year, after the manager of the top-performing fund – Alexander Darwall – announced plans to to leave Jupiter and set up his own fund group called Devon Equity Management.
And the fund with third biggest decrease in research activity is LF Equity Income, formerly known as LF Woodford Equity Income. This was the flagship fund of Neil Woodford, whose investment empire imploded in 2019 after investors pulled money from his portfolios following an extended period of weak performance.