The top performer for the month was Legg Mason’s Capital Management Opportunity Fund, which sits in the IMA North America Sector and returned 13.69% in January.
In total six of the top ten performing funds in January were US-focused, with five housed in the IMA North America Sector and one in the IMA North America Smaller Companies Sector, according to Adrian Lowcock, senior investment manager at Hargreaves Lansdown.
Meanwhile, two of the top ten – Investec’s Global Energy Fund and Invesco’s Global Health Care Fund (ranked second and fifth respectively) – both sit in the IMA Specialist Sector.
The remaining two funds in the top ten were European equity funds – Baillie Gifford European and Schroder European Smaller Companies, which came in eighth and tenth place respectively.
At the sector level North America cleaned up too, with both the top and second-best performing sectors US equity focused. IMA North American Smaller Companies returned 10.49% in the month while the IMA North America Sector returned 10.28%.
This will come as somewhat of a relief for US equity fund managers after the sector was named the worst for ‘dog funds’ in Bestinvest’s latest Spot the Dog report.
Lowcock said: “The rally in January started on the back of an agreement of sorts over the US fiscal cliff and was fuelled by a combination of improved economic outlook and unlimited monetary stimulus (QE).
“Given the US is the world’s largest economy and home to the world’s largest stock market, I would expect where it leads the rest will follow.”
But the recent rally may well have been tempered by the latest US GDP release, with figures indicating a 0.1% contraction in the fourth quarter last year, the first US GDP decline in three years.
