Chelsea Financial Services has identified the industry’s worst performing funds in its latest “Relegation Zone” report.
British equity funds feature heavily among the six worst underperformers, with offerings from Gartmore, Legg Mason and Rensburg making the list. There are many new entrants from groups including HSBC, Invesco Perpetual and Old Mutual.
The recently closed Thesis Unit Trust Management Resolution Fixed Interest fund tops the losers table, with almost 30% negative deviation from the sector average over three years to July 31, according to Financial Express data.
Legg Mason US Equity reaches second place with 29.1% deviation from the average, Gartmore Focus has 28.4%, and Rensburg Micro Cap Growth Trust 28.4%. Halifax Far Eastern is in fifth place with 27.5%, while CF Canlife UK Smaller Companies is in sixth with 27.2%.
Swip has three offerings among Chelsea’s list of the largest funds in its Relegation Zone, including the £2.5 billion Scottish Widows Corporate Bond fund, and a total of seven funds on the dud list.
At the sector level, UK Smaller Companies funds have suffered most over the period, with the average Relegation Zone fund in this sector falling 17.87%. Axa Framlington’s George Luckraft is a new entrant to the list following an extended period of underperformance.
There are 67 funds in total on Chelsea’s list, with combined assets of £10.2 billion.
Darius McDermott, the managing director, says: “Given the level of volatility that markets have undergone during [the last three years], it comes as no shock to find a litany of new offenders joining the drop zone.”