Bestinvest: Investors favour passive equity funds in October

Only two of top 10 most purchased funds – Fundsmith Equity and Loomis Sayles US Equity Leaders – were actively managed

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The top 10 most purchased funds for Bestinvest clients were exclusively equity mandates last month, on the background of an October which was unstable for fixed income and largely negative for equity markets.

Of the 10 equity funds, six had global investment remits, three were US equities, and one was a UK equity fund. For the month, the MSCI World index slid 2.3%, while the UK FTSE All Share index fell by 4%.

Terry Smith’s Fundsmith Equity fund and the Loomis Sayles US Equity Leaders – managed by Aziz Hamzaogullari – were the only two of the top 10 sellers which are actively managed. The other spots in the top five were occupied by the Fidelity Index World fund, the Vanguard LifeStrategy 100% Equity fund, and the Vanguard FTSE Developed World ex UK Equity Index fund.

Top 10 investments purchased on Bestinvest in October 2023 

 Fund/ Investment Trust / ETF 
1 Fundsmith Equity Fund 
2 Fidelity Index World Fund 
3 Loomis Sayles U.S. Equity Leaders Fund 
4 Vanguard LifeStrategy 100% Equity Fund 
5 Vanguard FTSE Developed World ex UK Equity Index Fund 
6 HSBC American Index Fund 
7 Legal & General Global Technology Index Trust 
8 Legal & General US Index Trust 
9 Vanguard LifeStrategy 80% Equity Fund 
10 Fidelity Index UK Fund   
Source: Bestinvest

Jason Hollands, managing director at Bestinvest, said: “Against this backdrop, Bestinvest clients who invested during the month firmly backed equities, perhaps spying an opportunity in market weakness.

“The most popular fund remained Terry Smith’s eponymous Fundsmith Equity fund, a concentrated, high conviction portfolio of developed market ‘quality’ companies,” Hollands said. “While the fund has slipped down a little in the relative performance rankings over the last three years, as ‘value’ managers have had a better run, Fundsmith clearly has a loyal band of fans.”

Bestinvest excluded its ready-made portfolios from these rankings, which are run by Evelyn Partners. Three would have otherwise made it into the top 10: Evelyn Growth Portfolio Clean, Evelyn Adventurous Portfolio Clean, and Evelyn Smart Maximum Growth Fund.

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