‘Investment-led’ buy list backs Hargreaves’ rejects

Terry Smith and Anthony Cross make the cut in Bestinvest’s streamlined list


Bestinvest has backed fund managers rejected from Hargreaves Lansdown’s rebranded Wealth 50, such as Terry Smith and Anthony Cross, in its streamlined buy list, released ahead of Isa season.

Fundsmith Equity, managed by Smith (pictured), and Liontrust Special Situations, managed by Cross and Julian Fosh, were among the 83 funds to make the cut in the wealth manager’s top-rated funds list.

The ‘Premier Selection of Top Rated funds’ has been launched ahead of investors deliberating on their pensions and Isas at the end of the tax year on 5 April.

Performance rated over OCF discounts

Tilney managing director Jason Hollands said the fund selection process was “wholly investment-led” and not driven by discounts on charges.

Hollands said: “We seek to find the very highest quality managers who have demonstrated that their judgment has added returns after costs. While we will always seek to use our scale as part of one of the UK’s largest private client investment groups to drive down fund costs for the benefit of our clients, we will only ever select active funds on our conviction that the manager can deliver superior returns.”

His comments come as Hargreaves Lansdown faces accusations of only including funds that heavily reduced ongoing charges figures in its revamped Wealth 50 list, which it unveiled earlier in January. The D2C platform giant boasted at the time that its average discount on OCFs had increased from 0.09% on the Wealth 150 to 0.22% on the smaller Wealth 50.

However, Hargreaves faced questions over whether it had shunned top-performing funds solely because they refused to offer discounted fees.

Fundsmith and Liontrust make the cut

Fundsmith Equity and Liontrust Special Situations, neither of which feature on the Wealth 50, both made it into the Bestinvest buy list.

Portfolio Adviser has previously highlighted that Hargreaves has written favourable fund research on Fundsmith Equity but still refused to include it on its buy list. Mark Dampier continued to defend the absence of Smith’s £16.4bn global equity fund from the Wealth 50 at a media event unveiling changes in January.

Liontrust Special Situations, which was culled from Hargreaves’ buy list when it became the Wealth 50, also gets backing from Bestinvest. The £3.9bn fund did not offer a discounted OCF. Chelsea Financial Services managing director Darius McDermott said it was the fund he was most surprised to see dropped from the Wealth 50 due to its “continually excellent” performance.

Jupiter European, Fidelity Special Situations and JOHCM UK Equity Income also feature in the Bestinvest list despite being among the funds without OCF discounts that were culled from the Wealth 50 this month.

Hollands said stalwarts of the Bestinvest list had consistently outperformed their benchmarks “more than justifying their costs”. Lindsell Train Global Equity and Evenlode Income were other funds he highlighted for their strong relative performance. The former features on the Wealth 50 offering a 27% discount on its OCF.

Tags: | | | | |

Recent News

Leave a Reply