ii ACE 30 ethical fund review: Q3 2020

by Liberty Godfrey from interactive investor |

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Here’s how interactive investor’s selection of ethical funds performed during a turbulent third quarter.

The majority of ACE 30 funds and investment trusts have performed in line with expectations over the third quarter of 2020, with 96% delivering positive returns over the period and 61% performing in the first and second quartile versus their respective peers.

Over the longer term, all active strategies delivered a positive performance over five years, and 69% have performed within the first and second quartile versus their peers over the same period. In addition, the ACE 30 passive strategies have performed in line with expectations and have kept tight tracking errors over the quarter and longer term.

The top-performing active strategies over the quarter included Impax Environmental Markets (LSE:IEM), which returned 11.97%, Impax Asian Environmental Markets, which returned 11.03%, VT Gravis Clean Energy Income with 9.3%, Stewart Investors Global Emerging Markets Sustainability with 7.15% and BMO Responsible Global Equity with a 5.34% return over the quarter.

At the other end of the table, the worst-performing ACE 30 active strategies over the quarter were BMO Responsible UK Income, which lost 1.98%, Pacific Assets (LSE:PAC), which returned 0.76%, Royal London Sustainable Leaders with 0.98%, Syncona (LSE:SYNC) 1.01% and AXA Ethical Distribution returned 1.03% over the quarter.

Over the longer term, the best-performing active strategies were Impax Environmental Markets, delivering 20.61% annualised over five years, BMO Responsible Global Equity, 17.47% annualised over five years, Syncona with 14.85%, Liontrust Sustainable Future European Growth with 12.16% and Stewart Investors Global Emerging Markets Sustainability with 11.76%.

Bottom performers over the longer term are BMO Responsible UK Income, with 2.72% annualised over the last five years, AXA Ethical Distribution with 3.78%, Threadneedle UK Social Bond with 4.24%, Liontrust Sustainable Future Corporate Bond 5.95% and Rathbone Ethical Bond, which has produced an annualised return of  6.48% over the last five years.

Top five ii ACE 30 funds in Q3

  Performance
Investment Q3 (%) YTD 1 Year 3 Years 5 Years
Impax Environmental Markets (LSE:IEM) 11.97 7.52 15.13 14.84 20.61
Impax Asian Environmental Markets 11.03 16.51 17.55 8.10  
VT Gravis Clean Energy Income 9.30 11.28 17.59    
Stewart Investors Global Emerging Markets Sustainability 7.15 6.88 3.59 6.34 11.76
BMO Responsible Global Equity 5.34 12.87 17.08 14.09 17.47

Source: Morningstar Total returns in sterling

Bottom five ii ACE 30 funds in Q3

  Performance        
Investment Q3 (%) YTD 1 Year 3 Years 5 Years
BMO Responsible UK Income -1.98 -17.79 -12.77 -1.64 2.72
Pacific Assets (LSE:PAC) 0.76 -2.96 -8.56 3.9 9.45
Royal London Sustainable Leaders 0.98 -1.82 1.71 9.24 11.03
Syncona (LSE:SYNC) 1.01 13.7 12.67 10.37 14.85
AXA Ethical Distribution 1.03 -7.31 -3.4 0.42 3.78

Source: Morningstar Total returns in sterling

Most-traded funds on the ii platform in Q3

Most-bought
Scottish Mortgage (LSE:SMT)
Alliance Trust (LSE:ATST)
Fundsmith Equity
City of London (LSE:CTY)
iShares Core FTSE 100 ETF (LSE:ISF)
Most-sold
Scottish Mortgage (LSE:SMT)
iShares Core FTSE 100 ETF (LSE:ISF)
Fundsmith Equity
iShares Physical Gold ETC (LSE:SGLN)
Polar Capital Technology (LSE:PCT)

Changes to the ii ACE 30 list (under review/developments)

No changes were made to our ACE 30 list of ethical selections during the third quarter.

However, the list has just undergone its annual review.

Any changes that are made will be listed on the ACE 30 hub here, along with a rationale for any changes. All changes made during the quarter will also appear in the next quarterly review in early January.

These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

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