Artemis funds pique adviser curiosity in Q1

Global strategies pick up interest as clients look to avoid the UK and Europe

Artemis was the most viewed fund group by advisers in Q1 as its Global Income fund attracted investors looking beyond the UK and Europe due to Brexit fears.

Four of the top 10 most-viewed products were from Artemis, according to Square Mile Investing Consulting and Research analysis of its Academy of Funds.

The firm’s Global Income fund was second only to Fundsmith Equity, while Global Select, European Opportunities and High Income were also in the list of funds attracting intermediaries’ attention.

James Glover, research and consulting operations director at Square Mile, said: “Anecdotally, there has been a pickup in interest in global strategies as clients look to avoid the UK and Europe because of Brexit and fears of an economic slowdown in Europe.”

Popular for a while

Glover said Artemis has been one of the more popular fund groups for a while. “We rate 10 funds managed by Artemis, which is one of the highest numbers of active funds rated for any fund manager, reflecting our analysts’ conviction in the Artemis fund managers to run portfolios that will meet client outcomes over time.”

Additionally, the report also revealed that equity was the most searched for asset class with a 55.8% share of views, up from 52% in Q4 2018, as investor appetite for risk returned following the market weakness in the fourth quarter.

Fixed income increased very slightly to 23.5% while multi asset dropped back to 19.5%.

Adrian Lowcock, head of personal investing at Willis Owen, said Artemis has “long been popular” with advisers. “Their strategic bond fund and equity income fund have been a top 10 fund in each sector for over a decade each. While the Artemis European fund had a terrible financial crisis the team have worked hard rebuilding its process and reputation.”

According to Square Mile’s quarterly market intelligence report, which captures viewing trends of 4,400 users, Artemis accounted for 11.1% of all views, comfortably ahead of Baillie Gifford (5.4%), Allianz Global Investors (4.9%), JP Morgan Asset Management (4.7%) and Invesco (4.5%).

“In addition, Artemis has an excellent global team with managers like Simon Edelsten as well as a strong small cap offering,” Lowcock said. “They have also built a strong US offering now as well. The group has been slowly gathering expertise and profile.”

The Artemis Global Income fund has underperformed on a one-year and three-year basis, with returns of 4.1% and 31.8% versus 10.7% and 33.8% for the IA Global Equity Income sector.

Lowcock added: “The Global Income fund has been popular with advisers who are not always turned off by short-term swings. Jacob de Tusch-Lec (pictured) looks to combine income with growth to deliver long term performance. This means the fund is likely to perform differently to its peers in the short term.”

IA UK All Companies leads the way

From a sector standpoint, the IA UK All Companies sector remains the most viewed, increasing its share to 13.6% from 10.7% in Q4. Within the sector the most viewed funds were LF Woodford Equity Income fund, LF Lindsell Train UK Equity fund and Liontrust Special Situations.

The IA Global sector followed with the next biggest uptick in views, up by 2.5% to 9.2% compared to Q4, driven by interest in Fundsmith Equity and Artemis Global Select.

IA Global Equity Income, IA UK Gilt and IA Short Term Money Market were the next most popular sectors, while the IA UK Volatility Managed, IA Europe inc UK, IA Mixed Investment 0-35% shares and IA Asia Pacific inc Japan sectors had the fewest views.

Within the risk targeted funds, the HSBC Global Asset Management range of funds were the most popular with 22.8% of the total views, followed by Standard Life (21.6%).

Within the passive funds, the IA North America sector saw the biggest jump in views, up 7.7% to 18.2% while the IA Global came second with 5.8% jump to 14.5%.

Glover said: “There is undoubtedly a strong correlation between what is hitting the headlines and trends among those using our Academy of Funds as advisers seek tools to help them cut through the prevailing market noise, reassure their clients and make informed investment decisions on their behalf.

“Ongoing speculation surrounding the Brexit process across the media, and indeed across almost every aspect of daily life, would account for continued interest in the IA UK All Companies. At a fund level, Fundsmith Equity, managed by one of the UK’s highest-profile fund managers, has captured advisers’ attention for very different reasons. At just under £18bn and with five year returns of 154.4%, Fundsmith Equity is very hard to ignore.”

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