The multi-managers’ research shows that 9% of funds in the IMA’s GEM sector have been regularly top quartile in each of the past three 12 month periods to 30 June. In the Japan sector, 5.6% of funds have achieved top quartile returns over the past three discrete years.
The F&C MM research shows consistency among funds across the 12 major market IMA sector has fallen from 4.56% over the three years to the end of Q1 to 2.05% over the three years to the end of Q2. Just 25 funds out of 1,221 with a three year track record have achieved consistent top quartile returns.
Lowering the hurdle rate to simply above median returns sees 144 of the 1,221 funds delivering consistency. This represents 11.79% of the funds examined and is still a drop compared to last quarter when 16.52% achieved returns steadily above the median.
According to Burdett and Potter funds examined using the hurdle of regular top quartile returns results in zero qualifiers from the IMA’s Sterling Strategic Bond, Global Bond, US and UK Smaller Companies sectors. The IMA Asia ex Japan and Global equity sectors each had just one consistent fund, they noted.
Using the less demanding criteria of above median returns and all 12 main IMA sectors have at least some qualifiers, although again GEM funds had the highest proportion while those in the IMA Sterling Strategic Bond sector had the lowest number.
In looking at the best and worst performers across all 36 IMA sectors over the past quarter, the multi-managers noted that for the third quarter in a row a Japan equity fund has lead the way. CF Ruffer Japanese was the best performer over Q2.
“This was likely due to smart profit taking following a very strong run at the end of May resulting in an 18%+ cash weighting going into the sell-off in the later stages of the quarter.”
The worst performer over Q2 was Junior Gold, falling by more than 50%.
