Almost £30bn of investor money is sitting in underperforming funds, according to research from IFA In...
Almost £30bn of investor money is sitting in underperforming funds, according to research from IFA Informed Choice.
The group’s LemonAid report assesses the worst funds from across a wide range of sectors by past performance, risk-adjusted returns, consistency and cost. From a possible 1,790 funds, 270 are described as in need of urgent review by investors, including two that still have an AAA S&P rating.
In the UK equities sector, losers include Axa UK Smaller Companies, New Star UK Growth and Rathbones Special Situations.
In the Global Equities space, Standard Life Investments Global Equity Unconstrained, Invesco Perpetual Dynamic Global Dynamic Theme and New Star Global Equity have been poor performers. The worst bonds funds included Norwich Monthly Income Plus, JPM Sterling Corporate Bond and Schroder Corporate Bond.
Managing director Martin Bamford said: “Our first LemonAid report throws a spotlight on the bottom 15% of the investment fund market. These are funds that show clear signs of underperformance and little prospect for improvement in the future.
“In each of the asset classes we studied, far better alternatives do exist. This report shows the scale of investor and adviser apathy. It is essential to review fund holdings regularly to ensure that they remain fit for purpose.”
