How to choose an absolute return fund

How to choose an absolute return fund

The past three years have seen both higher and lower volatility asset classes produce good returns overall, albeit with intermittent periods of relative weakness, and they have comfortably outperformed cash.

The strong equity market returns seen in 2012 and 2013 were driven primarily by macroeconomic factors, with monetary and fiscal policy from key governments, and central banks being important drivers of investor sentiment.  Many markets, stocks, and sectors were re-rated, with less distinction made between those areas whose re-rating was justified on a fundamental basis, and those that were not. The lack of variance in performance between individual stocks within the same sector made it difficult for active managers to generate alpha through stock selection, with sector positioning and...