Research finds 94% of absolute return funds 'unsuitable'


Financial planner Informed Choice has criticising the bulk of absolute return funds for charging unjustifiably high fees and lacking consistency of returns.

Informed Choice's research found just three funds - equivalent to just 6% of the IMA Absolute Return sector - met its 80% minimum suitability threshold, as judged by a quantitative screening model. The Henderson Credit Alpha fund, the Insight Absolute Insight fund and the Newton Real Return funds scored 92%, 81% and 80% respectively. But the majority of the 51 analysed funds (67%) scored less than half the maximum score. The research focused on ten factors, including annual performance figures, the number of gain and loss years, total expense ratios, quartile rankings and risk metr...

To continue reading this article...

Join Investment Week

  • Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
  • Get ahead of regulatory and technological changes affecting fund management
  • Important and breaking news stories selected by the editors delivered straight to your inbox each day
  • Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
  • Be the first to hear about our extensive events schedule and awards programmes

Join now


Already an Investment Week


More on Absolute Return

David Coombs, head of multi-asset at Rathbones Unit Trust Management

Rathbones' Coombs: Multi-asset funds 'called it right' but unable to combat hardship

Rathbone Multi-Asset Strategic Growth

clock 05 August 2022 • 3 min read
UK equities saw the largest outflows out of any category, at more than £2bn.

Refinitiv: Equity funds see almost £7bn outflows in June

Passive bonds attract fresh capital

clock 18 July 2022 • 3 min read
Duncan MacInnes is manager of the trust

Ruffer cuts equities to all-time lows as 'financial repression' settles in

Resilient premium

Eve Maddox-Jones
clock 18 July 2022 • 3 min read