A global star fund with less tech and US exposure

Every three months we trawl through our data in search of funds that have returned 5% or more in each six-month period over the last three years. We have recently crunched the numbers for the three years ending 30 April.

One fund, Ranmore Global Equity, has achieved the elusive six out of six. It is an offshore fund, domiciled in Ireland, but available in the UK, and has UK reporting fund status.

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No funds managed to beat the target five times out of six, but 35 achieved it four times. The table below shows the top ten, ranked by their one-year returns.

I am not surprised to see the gold funds featuring. They have benefited from the global uncertainty caused by the troubles in Ukraine and the Middle East, as well as President Trump’s on-again off-again tariff policies. I have written about them several times in recent months.

The top funds are also very different from the ones that we would have seen a year or so ago, when the Technology and North American funds were dominant.

When highlighting the best-performing funds over varying timeframes, it is not unusual for us to come across funds from the Global sector. The Investment Association classification gives the fund managers a fair degree of leeway, and so they can align with the latest trends. The sector definition requires funds to “invest at least 80% of their assets globally in equities. Funds must be diversified by geographic region.”

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The Technology & Technology Innovation sector was the best-performing sector in 2020 and again in 2023. Last year it came in a very close second. The Financial & Financial Innovation sector rose by 23.8%, while Technology & Technology Innovation made 23.5%.

When all the technology funds were doing well, we got used to seeing certain Global funds in the mix. There were several from Baillie Gifford – Baillie Gifford Global Discovery, Baillie Gifford Long-Term Growth, Baillie Gifford Positive Change – along with funds like GAM Star Disruptive Growth, abrdn Global Innovation Equity, and Liontrust Global Innovation.

The Ranmore Global Equity fund is very different.

It maintains a concentrated, actively managed portfolio that invests in undervalued companies from around the world. Managed by Sean Peche since its launch in 2008, the fund follows a disciplined, value-based approach, focusing on companies with strong fundamentals trading below their intrinsic worth. Rather than chasing trends or hugging benchmarks, the manager conducts detailed bottom-up analysis to identify opportunities others may overlook.

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It has relatively little exposure to the technology sector, preferring to focus on consumer discretionary, financials, and consumer staples:

• Consumer Discretionary – 27%
• Financials – 22%
• Consumer Staples – 14%
• Technology – 6%

That has definitely given it an edge over the last six months.

It still has a reasonably large exposure to the US, 24%, but significantly less than many other funds in its sector. The GAM Star Disruptive Growth fund has nearly 85% invested in the US, and the three Baillie Gifford funds that I mentioned earlier have over 60%. The Ranmore fund takes a much more balanced approach. Along with its 24% in the US, it has over 30% invested in Europe (including 5% in the UK), 15% in Asia, 9% in Japan and 8% in South & Central America.

The portfolio typically holds 30 to 40 mid- and large-cap stocks, diversified across regions and sectors.

While the fund can be volatile at times, it has delivered strong long-term returns and tends to stand out when sentiment turns in favour of value investing.

For investors looking for global exposure, without too much emphasis on the US technology sector, this could be a good option.

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