Recent reviews on St James's Place, Baillie Gifford, Hargreaves Lansdown, our Top Performing Funds Report and the Worst Performing Fund Manager Report represent our most popular 2020 investor insights.
Thousands of high net worth investors use our information and research to make more informed decisions. In this article we summarise the findings of our 5 most popular investor insights in 2020:
St. James’s Place Fund Review
A giant in the restricted advice world, This year St James's Place admitted to the regulator that two thirds of their investment funds did not offer consumers adequate value.
Our recent SJP review provides a detailed analysis of their fund performance and more. Some of the key findings from the 2020 report include:
- High charges and poor performance from St. James's Place Wealth Management.
- Over 50% of SJP funds rank in the worst 25% of their sector over the last 5 years.
- Over 72% of SJP funds perform worse than the benchmark.
- The SJP UK High Income & other SJP funds rank as the worst in their sector.
- Highest initial and ongoing charges
- Restrictive exit penalties for clients wishing to leave
2. Hargreaves Lansdown Wealth 50 Review
The Hargreaves Lansdown Wealth 50 is one of the most popular recommended funds list in the UK. Despite its clout with investors, the Wealth 50 list (formerly known as the Wealth 150) has continually been under the spotlight with concerns over the quality of the funds the list promotes and potential arrangements with fund providers, most notably the close ties between Hargreaves Lansdown and Neil Woodford.
Among those to voice concerns over Hargreaves Lansdown’s motives for the inclusion of funds in their Wealth 50 list was Terry Smith, the manager of the UK's largest investment fund, the Fundsmith Equity fund. According to The Times, Mr Smith accused HL of recommending funds based on their potential to maximise the fund supermarket's profits rather than their ability to outperform for clients.
At the start of May this year Hargreaves Lansdown announced their intention to scrap their Wealth 50 list and replace it with a new shortlist of funds overseen by an independent panel. However we have found that this new list still contains many of the same funds featured in the Wealth 50.
In this review of Hargreaves Lansdown’s recommended funds list, we feature the performance and sector ranking of each fund over the 1, 3 & 5 year period up to May 2020 and identify that a large proportion of the funds in the list have and continue to underperform when compared to other same sector funds.
Some of the key findings from this report include:
- 42.59% of the funds featured in Hargreaves Lansdown's 'Wealth 50' list underperformed compared to their peers.
- This report compares all funds in the Wealth 50 list against all other same sector funds over various time frames
- 8 out of 10 Hargreaves Lansdown's Multi-Manager funds have consistently performed below the sector average and have ranked among the worst performers in their sectors.
3. Baillie Gifford Fund Review
One of the most highly regarded fund management firms in the UK is Edinburgh based, Baillie Gifford. Their hands-on, growth-seeking approach to active investing, which they term as ‘Actual Investing’, has resonated with investors Globally, with 60% of the £198 billion of assets under their management from customers based outside of the UK.
Their range of funds and investment trusts widely considered by skilled financial advisers as some of the most attractive investment opportunities on the market.
In this report, we analysed all 33 Baillie Gifford unit trust funds and their 11 Investment trusts over 1, 3 & 5 years and compare their performance to every other competing fund within the same sector to identify how competitive their funds have performed. Based on their performance, we provided each of their funds with an overall performance rating between 1 and 5 stars.
From this analysis we identified a history of competency and continuous top performance. Some of our key findings identified:
- 56.8% of Baillie Gifford funds have consistently ranked among the best in their sector over the recent 1, 3 & 5 years.
- The Baillie Gifford North American returned growth of 248.25% over the last 5 years, which was the largest of all 118 funds in the Investment Association North America sector.
- Over the past 12 months, 29 of the 44 funds and investment trusts managed by Baillie Gifford outperformed at least 75% of their competitors within the same sectors.
4. The 10 Worst Performing Fund Managers
Some of the largest investment brands in the UK are among the worst-performing, with wealth management giant St. James’s Place ranking the worst from an analysis of 95 firms. These 95 firms have a combined £5 trillion of client assets in over 14,600 funds across the unit trust, life and pension fund universes.
In order to provide a comprehensive fund manager ranking, for this report, we reviewed 7,901 pension funds, 4,343 Life funds and 2,379 core unit trust funds assessing performance over the recent 1, 3 & 5 year periods. Each fund was provided a performance rating based on how they performed within their sector compared to all other same sector competing funds.
Some key findings from this analysis:
- From an analysis of 14,600 funds and 95 Fund management firms St. James’s Place ranked the worst performing fund manager for UK investors.
- The 10 worst performing managers are responsible for managing more than £500 billion of UK client money.
- Abbey Life, HBOS, Lloyds, Merian, Invesco, St James’s Place, Standard Life, Prudential, JO Hambro, Reassure, and Royal London, all ranked as the worst-performing fund managers.
5. The Best Performing Funds
There are approximately 3,000 core unit trust and OEIC investment funds available to UK investors that have received a sector classification from the 'Investment Association' (the industry trade body). Out of 3,000 funds, 20% have managed to consistently outperform at least half of all competing funds within their sectors over the past 1, 3 & 5 years, and have received a high quality 4 or 5-star performance rating from Yodelar. There is no shortage of quality funds across all asset classes and having the freedom to make informed choices can help improve portfolio efficiency and overall performance.
A fund managers ability to maintain a consistent level of performance when compared to competing same sector funds is an important metric for many investors when making investment decisions.
In this report, we feature 10 funds that represent some the most consistent and best-performing funds on the market and identify how a suitably balanced portfolio of such top-performing funds can help investors maximise the growth of their portfolio.
- 3 of the 10 funds featured are managed by Baillie Gifford
- One of the funds was Liontrust's Managed Growth Fund. This fund is from Liontrust's impressive range of Sustainable Futures funds and will be good news to the more ethical orientated investor. This fund has consistently been the highest growth fund in the entire IA Flexible investment sector.
- The Invesco China Equity fund has consistently been one of the top performing funds in the IA China/Greater China sector over different time frames.