The £623.5m Standard Life UK Equity High Income fund has been removed from the Hargreaves Lansdown Wealth 150 over disappointing performance.
Hargreaves Lansdown analyst Kate Marshall says performamce since 2008 has been “disappointing”.
The fund managed has been managed by Karen Robertson since 1995. The fund is currently fourth quartile in the Investment Management Association UK Equity Income sector over three years having returned 12.9 per cent compared to a sector average of 23.4 per cent.
Marshall says: “Karen Robertson attributes the fund’s recent poor performance to three key periods.
She says: “As the financial crisis unfolded in 2008, the fund had significant exposure to banks which proved costly. In 2010, performance was impacted by BP, a large holding, whose shares fell in value following the Macondo well disaster. In 2011, market sentiment was dominated by poor economic news rather than company fundamentals.”
According to Marshall, the fund was positioned in “economically-sensitive sectors” such as industrials, engineers and mining areas. She says these areas underperformed relative to more defensive sectors.
However, when markets rallied earlier this year, the fund “failed to deliver” despite its bias to cyclical sectors.
She adds: “According to our analysis stock selection has, overall, been a detractor from performance. The fund benefited from a period of positive stock selection following changes made in 1999, however, it has been on a downward trend more recently.”
However, Marshall says the removal from the list was not a suggestion to sell the fund, noting periods of good stock selection in the past.