JP Morgan Macro Balanced, Sarasin Global Equity Real Return and three funds from Barclays are the multi-asset funds that have turned their performance around in 2017, according to the latest FE Trustnet study.
In the first of a new series, we looked at the one FE Crown-rated funds that sit in the bottom quartile of their respective sectors over the last 10 years but that have risen to the top quartile this year.
We will also look at the long-term outperformers struggling in 2017 across a range of asset classes and Investment Association sectors.
Below, we look at the funds in the equity ranged IA Mixed Investment 40-85% Shares, 20-60% Shares and 0-35% Shares as well as the Flexible Investment sector.
Barclays
Three funds from Barclays Wealth and Investment Management feature on this list. All are run by head of manager and fund selection Ian Aylward, who joined the firm at the end of 2016.
Starting with the least risky fund, the £253m Barclays Balanced Portfolio has had a strong year so far in 2017, returning 10.72 per cent – the third-best performer of the IA Mixed Investment 20-60% Shares sector.
Its return this year is significantly above that of the average sector fund, which has returned 5.81 per cent in 2017.
Performance of fund vs sector YTD
Source: FE Analytics
However, its long-term numbers remain below average, with returns of 35.97 per cent over the last decade making it the worst performer in the sector over this period.
The multi-manager portfolio is underweight traditional fixed income although it is overweight emerging market & high yield debt.
The fund has a 46.1 per cent weighting to developed market equities and is also overweight emerging market equities. It is neutral on commodities and real estate exposure while underweight alternatives.
Barclays Balanced Portfolio has a yield of 1.7 per cent and an ongoing charges figure (OCF) of 1.60 per cent.
Higher up the risk scale is the Barclays Growth Portfolio, which sits in the IA Mixed Investment 40-85% Shares sector, has also had a strong year.
The £204m fund has returned 13.03 per cent so far in 2017 – a top quartile performance – though the portfolio’s long-term numbers are underwhelming. Indeed, over 10 years it has returned just 43.37 per cent – the fourth worst in the sector.
The fund has the same tactical over- and underweights as the Balanced portfolio, with higher weightings to developed market and emerging market equities at 57.4 and 14.1 per cent respectively.
Barclays Growth Portfolio has a yield of 1 per cent and an OCF of 1.64 per cent.
Finally, the £47.9m Barclays Adventurous Growth Portfolio rounds out the list. The fund, sits in the IA Flexible Investment sector, meaning it is not constrained on its weighting to equities.
As such, the fund has a 56.1 per cent weighting to developed market equities and 21.5 per cent to emerging market stocks, while just 9.9 per cent in fixed income.
So far this year, the portfolio has returned 4.78 per cent – a top quartile performance. Its 10-year returns of 46.3 per cent remain among the lowest in the sector however. The fund has an OCF of 1.80 per cent.
Sarasin Global Equity Real Return
Another top-performing multi-asset fund is the £77.4m Sarasin Global Equity Real Return fund, run by Mark Fairbanks Smith since August 2015, which has also seen a turnaround in performance this year.
Since the manager took over the fund, it has returned 37.09 per cent, 6.21 percentage points ahead of the IA Flexible Investment sector, as the below shows.
Performance of fund vs sector since manager start
Source: FE Analytics
This is good enough to place it in the second quartile during his tenure, thanks in part to a very strong 2017 which has seen the fund emerge as one of the best performers in the sector.
Unlike the Barclays funds, the Sarasin Global Equity Real Return fund aims to achieve a return equal to the UK retail price index (RPI) plus 3.5 per cent over a rolling five-year period, primarily through direct investment in companies rather than other funds.
The fund has a 31.9 per cent exposure to US equities, 31.9 per cent held in UK companies and a further 19.7 per cent weighting to Europe ex UK.
Despite its global equity focus, its largest individual holding is a UK gilt yielding 1.25 per cent and expiring in July 2018 (7.2 per cent). The remainder of its top 10 holdings include global companies such as Amazon.com, JP Morgan Chase and Colgate-Palmolive.
The fund has a yield of 1.44 per cent and a clean ongoing charges figure (OCF) of 0.99 per cent.
JPM Global Macro Balanced
The final fund on our list is the £147m JPM Global Macro Balanced run by Talib Sheikh since 2005 with co-managers Gareth Witcomb and James Elliot joining him in 2012.
Over the last year the fund has been the second-best performer in the IA Mixed Investment 0-35% Shares sector, returning 9.86 per cent.
However, over the past 10 years it is the third-worst performer of the 20 funds in the sector, returning 29.3 per cent.
While the fund recorded top quartile returns in 2015, 2014 and 2013 it was a bottom quartile performer in 2016 and each calendar year between 2009 and 2012.
Performance of fund vs sector since manager start
Source: FE Analytics
Currently, the fund has 41.4 per cent invested in equities where it has a 12 per cent weighting to Pacific Asia ex Japan and 12.1 per cent weighting to North America.
Within equities, information technology is a major theme for the portfolio with eight of its top 10 holdings deriving from the sector.
It has 53.8 per cent allocation in bonds where its largest exposure is in the US and Europe. It also has 4.8 per cent held in cash.
JPM Global Macro Balanced has a yield of 0.62 per cent and an OCF of 0.78 per cent.