Eight supersized funds that aren’t victims of their own success

Large chunks of investor money can make it tricky for fund managers to quickly invest it as opportunities arise, particularly in the small and mid-cap space where it can prove difficult to enter or exit positions.

As a fund grows in size, the investment universe becomes smaller, particularly for funds that specialise in smaller companies. This is due to the potential liquidity risk of not being able to sell easily when owning a large stake in a smaller company.

If managers struggle to replicate the same investment process, funds may be susceptible to “style drift”.

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Tom Bigley, fund analyst at interactive investor, explains: “Managers may opt to spread the capital across more holdings, which can potentially reduce the impact of their highest conviction ideas.”

We asked the experts to name funds with over £1 billion of assets that have not been hindered by their own success in terms of attracting assets and have continued to deliver strong performance.

Fidelity Global Dividend

Bigley says the anticipation of rate cuts and market volatility recently has pushed demand for funds producing a stable income.

He picks Fidelity Global Dividend as a fund that has benefited from this trend.

Having attracted consistent inflows over the past 12 months, the fund has grown to over £3.5 billion, but continues to perform well, featuring in the top quartile within its sector over the year.

“This fund is designed to give investors a smoother ride through market cycles, investing in companies from across the globe that offer a healthy dividend yield and the potential for capital growth.”

Notably, the fund remains highly differentiated from its benchmark with an active share of 95%, Bigley adds.

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Man Income

In Jupiter’s multi-manager Merlin range, the £2 billion Man Income fund is the largest holding.

The fund has two buckets, one that leverages the group’s Undervalued Assets strategy and the other that invests in high dividend-paying stocks.

Jupiter investment manager David Lewis says: “The managers are able to manage the liquidity because – particularly in the value-orientated approach – they are inherently buying companies that are out of favour.

“Even the dividend-generating side leans towards contrarian investing because companies that boast high dividends have often seen their share price come down.”

Having a multi-cap structure of investing across companies of all sizes also enables the managers to move up and down the spectrum to manage liquidity.

Lewis adds: “The fund tends to have larger positions in bigger companies and a significantly greater number of companies further down the market cap spectrum to ensure the position sizes don’t become too challenging.”

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Artemis Income

Like Man Income, which has been managed by Henry Dixon since inception in 2013, Artemis Income has long been run by the same manager; Adrian Frost who picked up the mandate in 2002.

Such a long tenure provides reassurance in the continuity of the investment approach, says Ian Rees, head of Premier Miton’s multi-manager team, which is important for such a large fund, a sizeable £5.1 billion.

“Artemis Income has defied all the naysayers when it comes to being supersized and being able to maintain performance,” Rees says.

However, due to the size of the fund, the managers have had to look more at larger-cap overseas positions, which have become a bedrock to the UK-focused fund, Rees adds.

Rees adds: “The managers are using more of the 20% allocation to non-UK positions to manage liquidity. But apart from that, the cash flow-driven approach the managers utilise is something they’ve continued with.”

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Artemis UK Select

Another behemoth from the same fund house, Artemis UK Select has attracted net flows of over £1 billion over the last year alone, taking it to £5 billion, but continues to provide excess returns to investors, according to Arbuthnot Latham’s Peter Doherty.

“The fund is a bottom-up, ‘best ideas’ strategy of 40 to 50 stocks but it’s benchmark agnostic approach allows the managers to access opportunities across the market cap, where they seek alignment between the stock-specific investment thesis and the manager’s macroeconomic views,” says Doherty, head of investment research.

Historically, the fund has had a higher exposure to UK small and mid-cap companies, but the managers have identified more opportunities in mid-to-large cap names over the past three years, enabling them to manage higher levels of assets under management while not eroding their ability to outperform the market.  

“While this has been successful in recent history a question lies as to whether the manager would be able to access opportunities in the small-cap sector, should opportunities start to prevail in this segment of the market, given their increased size,” Doherty says.

Pacific North of South EM All Cap Equity

One tactic asset managers use to prevent funds becoming unwieldly is “soft closing” them by ceasing to market the strategies. This reduces inflows and gives the manager a better chance of maintaining their exposure to smaller companies. Pacific North of South EM All Cap Equity is a case in point.

“Pacific North of South EM All Cap was launched in 2017 and has grown significantly in size over the past few years; standing at roughly £2.3 billion today,” says Carly Moorhouse, senior fund analyst at Quilter Cheviot.

“Because of the small and mid-cap exposure they are conscious of the amount of assets they are managing and, in 2024, soft closed the fund.”

Moorhouse adds: “The portfolio managers have always maintained a strong focus on portfolio liquidity, aiming to ensure that at least 75% of the portfolio can be liquidated within five trading days.”

James Godrich, fund manager at JM Finn, also backs the fund, a core allocation within the Asia and emerging market allocation of the firm’s multi-asset funds.

“As a multi-cap, multi-geography strategy, the investable universe for the fund remains significant and it continues to generate strong returns,” he says.

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M&G Asian

Ben Yearsley, co-founder of Fairview Investing, maintains that large inflows only really work when the fund primarily buys large-cap holdings.

“Large inflows into smaller company funds are normally the kiss of death; there aren’t many small-cap funds with £1 billion or more in assets because they simply can’t invest the money sensibly at the right price,” he says.

Yearsley highlights M&G Asian, which has rapidly grown from £150 million three years ago to its current size of £750 million.

“The fund has delivered a 81.9% return versus the IA Asia ex Japan average of 34.7%,” he notes, with data to 6 October 2025.

He adds: “It has a clearly defined philosophy and is fairly style agnostic, giving the managers a broader spread of companies to choose from.”

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Capital Group New Perspective

Capital Group New Perspective is the largest of the funds chosen by our experts at a whopping £14 billion. Despite its size, the fund is able to efficiently manage new money through its distinctive multi-manager approach, which sees inflows spread across different portfolio managers.

“This allows very large sums to be deployed efficiently without diluting the process,” says Darius McDermott, managing director at FundCalibre.

McDermott adds: “Its structure also ensures consistency, minimising concerns about manager change or style drift over the medium or long term. This design has longevity, as demonstrated by the fund’s impressive track record spanning over 45 years.”

Alliance Witan

While investment trusts don’t have the same liquidity issues as their open-ended counterparts due to their fixed capital structure, bigger trusts specialising in mid and small-cap companies must still navigate the constraints their size puts on them, while large-cap mandates can face their own challenges.

Following the merger of Alliance Trust and Witan last year, the combined company now has total net assets of £5.2 billion.

“The managers achieve diversification by distributing the portfolio across 11 managers,” says James Carthew, head of investment company research at QuotedData,

“It helps that Alliance Witan Ord (LSE:ALW) tends to be biased towards larger companies. However, Witan previously had a portfolio of investment companies. When it came to transitioning these, the Alliance Witan manager felt it was best to take its time, not because it had a problem with their liquidity but because it felt they were undervalued.”