Technology focused funds have dominated performance rankings for the first half of the year, in research compiled by Quilter.
Liontrust Global Technology took top spot with a 39.9% return over the six months to the end of June, second was T. Rowe Price Global Technology with 38% and in third place was L&G Global Technology Index, which delivered a 36.4% return.
Broad US equity funds took most of the other places in the rankings thanks to the very strong start to year for the asset class. Natixis Loomis Sayles US Equity Leaders, Morgan Stanley US Advantage and Baillie Gifford American all featured. The full table can be viewed below.
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Nick Wood, head of fund research at Quilter Cheviot, commented: “The past six months have been tumultuous from a markets perspective as rising interest rates, banking crises and geopolitical volatility have taken centre stage. So far, this year has seen a fairly dramatic sea change in the winners and losers from an investment fund perspective too as asset managers have attempted to navigate a fairly tricky environment.
“Nowhere have we seen such a reversal of fortunes than in the tech world, which came back with a bang following a difficult 2022,” Wood continued. “Ultimately, it has one thing to thank for this u-turn in performance and that is generative artificial intelligence.
“Roll back to the end of last year and it is likely very few had heard of ChatGPT, but it has rarely left the headlines since January. This has fuelled some extreme positive share price movements in a subset of technology stocks, not least Nvidia and Microsoft.”
On the other side of the coin, Chinese equity funds struggled badly as optimism over an end to Covid-related lockdowns in the country fell away. Abrdn China A Share Equity was the worst performer, falling 19%, with SVS Aubrey China, JPM China, Allianz China A-Shares Equity, FSSA All China and Janus Henderson China Opportunities all struggling.
“Another area that has surprised this year is China,” Wood said. “At the beginning of the year, the Bank of America Fund Manager Survey showed a huge amount of bullishness on China post-Covid reopening, but this has very much not materialised in terms of equity returns, with dedicated China funds propping up the bottom of the list of poor performers.”
