This is the second instalment of Asset Allocator’s 100 Club wrap-up, where we pick out some of the highlights from our annual hand-picked selection of premier funds and asset managers.
In the corresponding piece we covered the best equity funds across regions and cap sizes, and now it’s time we move onto the remaining categories – namely, fixed income and alternatives.
Without further ado, let’s get stuck into the details.
Schroders shines despite strat bond travails
A theme Asset Allocator has covered in detail this year is the relative malaise of strategic bond funds. Poor performance has led to some allocators taking their duration calls in-house, rather than using managers.
Some exceptions to this rule have been found in the shortlist. Peter Harvey’s Schroder Strategic Credit returned 10 per cent over one year by fishing in the middle of the credit spectrum, using predominantly BBB-rated and high-yield fixed income instruments.
The £700mn mandate is one of the more popular strat bonds in our database, held by four allocators.
Over in sterling corporate bonds, another big name has taken the crown.
Bryn Jones’s Rathbone Ethical Bond, the largest mandate of its type, has managed to stay mostly out of the drop in appetite for sustainable equities, instead finding a niche integrating ESG policies into fixed income issuance.
It’s the second most popular corporate bond fund among allocators in our database with five holders, bettered only by Artemis Corporate Bond.
Polar Capital continues dominance in specialist sector
The specialist funds category is something of a strange beast, with all manner of sectors and themes eligible for 100 Club membership.
This year’s winner is Polar Capital Technology trust, which returned an impressive 110 per cent over five years, in part down to homing in on the market’s best-performing sector in recent years.
The fund is naturally tech-fuelled and growth-oriented, so it’s interesting to note that just one allocator has bought into this mandate.
Is this because investors believe they can get their fill of AI stocks in a US or global tracker, without having to pay premium fees or risk total thematic concentration?
Polar Capital Technology came up trumps against an array of trusts investing in other sectors, such as private equity, frontier markets, and biotech. The latter has had it tough recently, which we covered here.
Premier Miton takes on winning Tellworth fund
In the absolute return category, the criteria for selection is slightly different. Here, the shortlist contains those that have provided a return of more than zero in each of the past five 12-month periods.
Tellworth UK Select takes the crown in this asset class, an asset manager that was acquired by Premier Miton in January.
The firm’s co-founder, John Warren, is also a manager on the UK Select fund, which picks from a wide selection of UK smaller companies in an environment that expects to see a turnaround when interest rates begin to fall.
It has returned 10 per cent over one year, and we’ll see how it gets on in the second half of 2024 as the prospect of rate cuts draws closer.
Indeed small-caps have been a significant talking point for our allocators this year, with a spate of DFMs flooding into the asset class. You can read more about that, here.
