Equity income funds suffer amid fresh credit concerns

Equity income products have suffered over the last week as oil prices have rebounded and bank shares ...

Equity income products have suffered over the last week as oil prices have rebounded and bank shares have sold off due to fresh credit concerns.

Last week the oil price made gains and the dollar fell as US mortgage giants Fanny Mae and Freddie Mac were sold to 20-year low levels.

The bottom ten UK-domiciled fund performers were all UK equity or Reit focussed and many had high bank weightings.

The worst week was had by Santander Equity Income, which fell 6.76% as at 20th August according to Morningstar.

A range of Standard Life UK equity funds joined the back of the pack, losing over 5.7% across the timescale.

UK property equity funds Swip UK Real Estate and UK-focused Aberdeen Property Share both tumbled by around 6% in the single week.

They now show losses of 40.63% and 38.61% respectively over one year.

Falls across the sector due to a slew of news of poor housing sales hit key fund holdings including Hammerson, Land Securities and British Land.

Despite the UK theme to poor performers Manek Growth continued its recent IMA UK All Companies domination to report 2.6% growth over the week, ranking it third overall.

Elite’s Dogs of the FTSE 100 lived up to its name with a 5.27% fall in the week, failing to sooth a now 43.83% fall over one last year.

The best performers were First State Global Resources, up 3.68%, and Oceanic Australian Natural Resources, up 3.33%, benefiting from rebounding commodity prices.

Elsewhere Threadneedle China made an impromptu appearance in the top ten list, gaining 2.27% over the week.

UBS’ Corporate Bond UK also put in an appearance with 2.03% growth.

New Star’s bank-laden Higher Income and UK Growth funds lost 4.87% and 4.84% respectively over the timescale, placing them near the bottom of the pile.