Woodford tops 2016 fund picks despite poor performance

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The Woodford Equity Income fund has topped a list of most favoured funds in 2016, despite underperforming the benchmark, in a year that was largely dominated by funds with global and gold exposure.

This week fund manager Neil Woodford admitted he was disappointed the fund had failed to achieve the high single digit returns it was hoping for, instead delivering 3.3 per cent. The FTSE All Share returned 16.8 per cent over the period.

Regardless, the equity income fund, which is also on track to drop out of the IA sector, has been the top pick among investors, according to The Share Centre.

The remainder of the list of most traded funds is dominated by global funds, as well as gold, with Fundsmith Equity, Legg Mason Japan Equity, Blackrock Gold & General and Jupiter India rounding out the top five.

The only other UK-focussed fund to feature in the list appeared due to selling rather than a large number investors. The Old Mutual UK Mid-Cap fund has delivered 16.8 per cent over one year, according to FE data.

Andy Parsons, head of investments at The Share Centre, says: “With continued uncertainty around the Brexit negotiations and the impact these will have on businesses, this may well have been a catalyst as to why investors were shying away from UK focussed funds towards the back end of 2016.

“It will be interesting to see if optimism grows for UK funds in 2017, particularly given the heights the FTSE 100 has reached of late.”

The fund, which is managed by Richard Watts, was the only one to appear on the list due to higher selling than investing.

Other international or global funds featured in the top 10 list include Newton Global Income and Stewart Investors Asia Pacific Leaders, while the Investec Global Gold fund was the eighth most traded fund. The list was rounded out by the Polar Capital Healthcare Opportunities fund.