Standard Life Gars fund tops Bestinvest’s September sales list

Jason Hollands 160 byline
Jason Hollands

The Standard Life Global Absolute Return Strategies fund was the best-selling fund on the Bestinvest platform in September.

The £13.1bn fund, which aims to achieve a positive return of 5 per cent above cash in all market conditions, has hit the headlines recently after losing a number of its team to Invesco Perpetual last month.

Bestinvest managing director Jason Hollands says: “Standard Life Gars is our core recommendation for absolute return exposure in client portfolios and employs a multi-strategy approach, with a very large team working across the various underlying strategies. As such, we see regular flows into the fund.”

The £586.2m HSBC American Index fund was the second most-bought fund, while the £126.2m UBS US Growth fund was third placed.

Top ten selling funds in September
1. Standard Life Global Absolute Return Strategies
2. HSBC American Index
3. UBS US Growth
4. Threadneedle UK Equity Income
5. M&G Strategic Corporate Bond
6. Newton Global Higher Income
7. Axa Framlington UK Select Opportunities
8. JO Hambro CM UK Opportunities
9. First State Global Emerging Markets Leaders
10. Axa Global High Income
Source: Bestinvest

Hollands explains: “The flows into HSBC American Index and UBS US Growth partially reflect the outcome of a recent sector review which resulted in one-star, sell ratings applied to a number of US equity funds: Neptune US Opportunities, Fidelity American and Martin Currie North America.

“Clients will therefore have been switching into our favoured funds: HSBC American Index for a passive approach and UBS US Growth for an actively managed fund. We often use index funds for large-cap US exposure as historically the S&P 500 Index has proven difficult to beat, especially in rising markets.”

The Bestinvest managing director remains positive regarding equity funds, with the Threadneedle UK Equity Income fund listed fourth in the top 10 best selling funds in September. A number of equity income funds were also included in the top-selling funds, such as Threadneedle UK Equity Income, Newton Global Higher Income and Axa Global High Income funds.

Hollands adds: “We are very positive of UK equity income funds at the moment. Firstly, because we believe valuations are attractive on two key measures of value: the extra return of shares over bonds – the ‘equity risk premium’ – and the price multiple of the earnings of companies, allowing for the economic cycle, the ‘cyclically adjusted price earnings’ multiple or ‘Cape’.

“We particularly like equity income because yields are now higher than investment grade bonds and dividends are well-covered by underlying earnings, which suggests there is room for further increases,” he added.