Which were the best and worst funds for H1 2017?

Eight of the 10 worst performing funds in the first half this year were energy funds and could act as a warning for sector-specific funds that have topped the performance tables over the last six months.

The IA Technology & Telecommunications sector delivered 18.3 per cent over the period, only beating the China/Greater China sector, which delivered 19.9 per cent, and the European Smaller Companies, which delivered 18.6 per cent.

However, it was a UK equity fund, Old Mutual UK Smaller Companies Focus, that topped the performance tables delivering 32.2 per cent.

Money market sectors aside, Targeted Return, UK Gilts and North American Smaller Companies delivered the lowest returns with 2.4 per cent, 2.3 per cent and 2.1 per cent respectively.

Within the technology sector T Rowe Price and Polar Capital funds delivered the best performance returning 27.9 per cent and 27.1 per cent respectively.

But Architas investment director Adrian Lowcock warns investors that the concentration of energy funds in the bottom of the performance tables is a reminder that sector funds can be volatile and move from top to bottom performers very quickly.

Investors have been focussed on tech companies hoovering up market share, Lowcock says. But he adds: “At some point investors will need to focus on the fundamentals of each business as not all technology companies offer the same risk and return.”

Schroder ISF Global Energy, Investec Global Energy and Guinness Global Energy were among the worst performers delivering -24.2 per cent, -20.9 per cent and -19.3 per cent respectively. However, LO Global Energy bottomed the table with -26.4 per cent.

“The sector rebounded strongly following the sell-off in 2016 but has lagged behind the wider market as the oil price found a ceiling and more recently began to fall again as investors became concerned over excess supply.”

Lowcock notes that while absolute return continues to languish, single digit returns are in keeping with many of the funds’ objectives.

“The sector remains hard to analyse as it comprises funds with very different objectives and risk characteristics.

Meanwhile, Donald Trump has helped secure dampen the US smaller companies rally. “It has become increasingly clear Donald Trump will struggle to deliver his tax and spending reforms this year and any final agreement is likely to be less than initially expected,” Lowcock says.

Best Performing sectors

IA Sector

% Total Return

China/Greater China

19.9

IA European Smaller Companies

18.6

IA Technology & Telecommunications

18.3

IA Asia Pacific Excluding Japan

16.6

IA Asia Pacific Including Japan

15.4

Source: FE Trustnet, 31st December 2016 to 23rd June 2017

 

Best Performing Funds

Fund

% Performance

Old Mutual UK Smaller Companies Focus

32.2

Baillie Gifford Greater China

29.1

NB China Equity

28.6

Aubrey Global Conviction

28.0

T. Rowe Price Global Technology Equity

27.9

Polar Capital Global Technology

27.1

GS India Equity Portfolio

27.1

Morgan Stanley US Growth

27.0

Baillie Gifford Pacific

26.7

JPM Asia

26.1

Source: FE Trustnet, 31st December 2016 to 23rd June 2017

Worst Performing Sectors

IA Sector

% Total Return

Targeted Absolute Return

2.4

UK Gilts

2.3

IA North American Smaller Companies

2.1

IA Money Market

0.1

IA Short Term Money Market

0.0

Source: FE Trustnet, 31st December 2016 to 23rd June 2017

 

Worst performing funds

Fund

% Total Return

HSBC GIF Russia Equity

-14.4

GS North America Energy & Energy Infrastructure Equity Portfolio

-16.6

Artemis Global Energy

-16.9

BlackRock GF World Energy

-18.2

CF Canlife Global Resource

-19.2

Guinness Global Energy

-19.3

Investec Global Energy

-20.9

VT Craigshannoch Multi Strategy

-22.7

Schroder ISF Global Energy

-24.2

LO Global Energy

-26.4

Source: FE Trustnet, 31st December 2016 to 23rd June 2017