If you are looking for the best investment funds to boost your portfolio, then avoiding the worst or so-called dog funds is a good place to start or even verify your choice.
Research from Bestinvest has highlighted that there has been a 65% increase in dog funds and the highest number it has on record – so it makes sense to pay attention to the funds you chose now, more than ever with £54.4bn in these poor-performing funds.
The criteria for being identified as a dog fund is not meeting its respective benchmark and have under performed by 5 percent or more over the three year analysis period.
So let’s look at the fund managers topping the list first;
- Invesco, 13 dog funds, £11.4bn AuM
- St. James’s Place, 8, £6.9bn
- Fidelity, 4, £3.8bn
- Scottish Widows, 3, £3.5bn
- Schroders, 10, £2.7bn
- M&G, 7, £2.4bn
- Dimensional, 2, £2.3bn
- HBOS, 3, £2.1bn
- Jupiter, 7, £2bn
- Hargreaves Lansdown, 1, £2bn
Those fund managers that deserve a ‘tummy rub’ include Fundsmith, JO Hambro and Lindsell Train.
Interestingly in terms of fund sectors;
- Strong under-performance in smaller companies funds were rare – just one was found in a UK equity fund.
- The lowest proportion of dog funds were found in the UK all companies and global emerging markets sectors.
- The highest proportion of dog funds were found in the UK equity income and global equity income funds reflecting dividend cuts.
Funds that are featured in the list are not an automatic sell if you hold them already, they are highlighted to show that investors should assess the prospects of the fund and whether they should remain invested or move on.