Emerging Markets dominated the fund performance tables in August, with five of the top 10 funds emerging markets mandates and the region appearing in two of the top five sectors.
While Indian growth was lacklustre at 5.7 per cent, China and Russia both performed well, with the Hang Seng rising 2.25 per cent over the month, making it the best-performing major market.
However the top-performing fund was Investec Global Gold, which was up 10.55 per cent following the surge in the price of gold, followed by Invesco Perpetual Japanese Smaller Companies, which climbed 10.17 per cent as Japan marked the strongest growth since 2015.
Ben Yearsley, director at Shore Financial Planning, says: “August was the month of North Korea sabre rattling boosting the price of gold to over $1300 an ounce and more worries about consumer debt, slowing growth and stagnating wages. Although that’s more a reflection of developed rather than developing nations.
“Despite Indian growth disappointing with a figure of under 6 per cent, China is still growing strongly with the latest figures showing factory output unexpectedly increasing. As well as being positive for other emerging markets, China doing well is also good news for the mining and basic materials sector, which dominated the tables in August.
“I’ve been positive on emerging markets and Asia for a number of years now and continue to believe they offer excellent long term growth prospects.”
Woodford Equity Income was the second worst-performing fund in August after a series of negative updates from his holdings, down 4 per cent, behind MFM Techinvest Technology which was down 8.25 per cent.
“Don’t write Neil Woodford off just yet, but by his standards it is two dreadful months in a row with his three biggest holdings having a torrid time,” Yearsley says.