Interactive Investor

ii Super 60 performance review: Q3 2023

Discover how interactive investor’s rated funds performed in the three months to the end of September.

12th October 2023 13:15

by the interactive investor team from interactive investor

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At the end of the quarter, we saw clear outperformance of the value style over growth in most regions, and this has largely defined the performance of funds at the top and bottom of the Super 60 investment ideas' list.

The top-performing fund over the quarter was the WisdomTree Enhanced Commodity ETF (LSE:WCOB), which provides investors with exposure to four broad commodity sectors (energy, agriculture, industrial metals, and precious metals) plus up to 5% in bitcoin. With energy prices rising over the quarter as a result of a series of supply cuts, this exchange-traded fund (ETF) produced a return of just over 8%.

After an extended period of weakness due to concerns over rising interest rates and demand, the portfolio of pan-European property equities and UK physical property held byTR Property (LSE:TRY), provided investors with a more pleasing return of just over 6% in Q3 2023. This share price return was the second strongest on the Super 60 and reflected an uplift in the underlying value of holdings and a reduction in the discount, as investors recognised that peak interest rates were drawing nearer.

The next three funds on the top performers' list all invest in UK equities, which produced relatively good performance over the quarter, reflecting the bias to the value style that the UK market exhibits in comparison to global markets.

Diverse Income Trust (LSE:DIVI) aims to provide investors with an attractive and growing income, together with capital growth over the longer term. The trust is managed by Gervais Williams and Martin Turner, who both have significant experience in the small-cap space, and the trust maintains a significant weighting to this part of the market. As news regarding the UK economy and interest rate expectations became slightly more favourable over the quarter, smaller-cap stocks outperformed. In addition, the trust benefited from improving sentiment through a narrowing of its discount, resulting in a share price return of just under 5%.   

It was a similar story for Fidelity Special Values (LSE:FSV). The trust is managed by Alex Wright, who has been at the helm of this all-cap strategy since 2012. Prior to this fund he successfully managed a small-cap strategy and he continues to implement his tried and tested approach that looks to identify unloved companies with the potential to recover based on factors such as a business model/corporate change or industry cycles. The manager may buy into such situations at an early stage, which tends to result in a contrarian value bias. There is an element of overseas exposure (mainly Europe) and gearing (up to 125% net exposure). The contrarian and value-oriented approach to investing, and the small-cap bias have been beneficial over the quarter, with a positive net asset value (NAV) return being boosted by the discount narrowing.

Jupiter UK Special Situations is the final fund on the list of top five performers with a return of just over 4.5%. The managers adopt a clear value approach that aims to identify longer-term valuation anomalies by looking for stocks that have an attractive price/earnings (PE) ratio when calculated using 10-year average earnings, or which look attractive on an earnings yield to return on capital basis. This, plus the slight bias down the market-cap scale, have been beneficial over the quarter.

Moving to the bottom of the performance table, we find Baillie Gifford Shin Nippon (LSE:BGS). This smaller-cap Japanese equity product follows the more extreme end of the Baillie Gifford house process and focuses on identifying stocks with high earnings and sales growth. This growth style and an element of gearing largely explains the performance over the quarter, which was down just under 6% in NAV terms, while the widening of the discount led to a nearly 9% decline in share price terms. This trust is clearly a higher-risk product, which investors should expect to show significant variability in performance depending on market conditions.

As its name suggests, FTF ClearBridge Global Infrastructure Income invests in listed infrastructure companies and has an overall objective of generating an income in excess of inflation. Given the approach, it has significant exposure to the utilities sector, which performed particularly poorly over the quarter. The fund showed a negative return of 6.8% and much of this reflects the greater than 65% exposure to utilities. Despite some weakness versus peers over the short term, the fund has demonstrated longer-term success.

Man GLG Continental European Growth Portfolio is the next fund on the underperformers' list. Having produced strong returns earlier in the year, the fund succumbed to the recent rotation towards value stocks. Europe ex-UK has also been one of the weaker equity regions over the past quarter and these two elements have resulted in the relative returns seen. The fund continues to be managed by the highly experienced Rory Powe, and is a concentrated, high-quality-growth fund that has shown persistent overweights to the consumer discretionary and IT sectors.

The final two funds on the underperformers' list are global products, but they have shown weakness for different reasons. Murray International Ord (LSE:MYI)saw a marginal drop in its NAV over the quarter, but in share price terms the weakness amounted to over 5.5% as the discount widened. This widening coincided with the announcement that the long-term manager of the trust, Bruce Stout, is due to retire in 2024. The two existing co-managers will continue to run the trust using the same broad philosophy, but the loss of Stout is clearly a negative.

The final fund on the underperformers list is abrdn Global Smaller Companies and it showed a negative return of just over 4%. It is managed using the group’s proprietary quantitative matrix and this, plus the subsequent fundamental analysis, results in a portfolio that has a clear growth bias. There is also significant exposure to small-cap stocks in Europe and the US, which have come under pressure in the current environment. In combination with the growth style, this structural positioning explains much of the relative performance over the quarter. 

Top five Super 60 funds in Q3 2023

Group/Investment3 month1 year3 years5 years
WisdomTree Enhanced Cmdty UCITS ETF USD8.22-9.1857.9847.77
TR Property Ord6.040.06-7.92-16.59
Diverse Income Trust Ord4.82-0.9911.46-5.24
Fidelity Special Values Ord4.8017.0068.1713.36
Jupiter UK Special Situations I Acc4.5819.2163.2225.51

Source: Morningstar - Total Return for OE / Market Return for CE - (GBP) to 30/09/2023.

Bottom five Super 60 funds in Q3 2023

Group/Investment3 month1 year3 years5 years
Baillie Gifford Shin Nippon Ord-8.95-17.08-46.13-37.62
FTF ClearBridge Global Infras Inc WAcc-6.78-10.3815.5249.17
Man GLG Continental Eurp Gr Prf Acc C-6.7418.413.6929.06
Murray International Ord-5.556.0143.5032.51
abrdn Global Smaller Coms P1 Acc-4.222.39-8.970.52

Source: Morningstar - Total Return for OE / Market Return for CE - (GBP) to 30/09/2023.

Top five Super 60 funds for a five-year period

Group/Investment3 month1 year3 years5 years
iShares Physical Gold ETC GBP (LSE:SGLN)1.862.214.5966.91
Vanguard U.S. Eq Idx £ Acc0.679.8536.9561.85
Premier Miton US Opportunities B Acc0.993.0833.1560.15
Jupiter Merian North Amer Eq I GBP Acc1.167.0341.9055.50
iShares Core MSCI World ETF USD Acc GBP (LSE:SWDA)0.5711.6234.1152.23

Source: Morningstar - Total Return for OE / Market Return for CE - (GBP) to 30/09/2023.

Bottom five Super 60 funds for a five-year period

Group/Investment3 month1 year3 years5 years
Balanced Commercial Property Ord (LSE:BCPT)4.32-10.0922.41-38.32
Baillie Gifford Shin Nippon Ord-8.95-17.08-46.13-37.62
Vanguard UK Govt Bd Idx £ Dist-1.08-3.77-34.28-21.65
Lindsell Train Japanese Eq B GBP Qut Dis-2.13-9.39-25.88-19.80
TR Property Ord6.040.06-7.92-16.59

Source: Morningstar - Total Return for OE / Market Return for CE - (GBP) to 30/09/2023.

Most-bought Super 60 funds in Q3 2023

Most-sold Super 60 funds in Q3 2023

Changes to the Super 60 list (under review/developments)

September 2023: Murray International Trust: Under Review

September 2023: Janus Henderson European Selected Opportunities Fund: Under Review (this fund was removed from under review today [11/10/23] and retained on the list – but post-quarter end)

September 2023: GAM Star Credit OpportunitiesFund: Under Review

Super 60 videos in Q3

Murray International

Bruce Stout: I’ve bought bargain bonds twice in 20 years, but won’t buy gilts now

How Murray International has a higher yield than most rivals

City of London

City of London: the ‘ultimate backstop’ to keep paying a rising income

Job Curtis: five stocks I’ve bought for City of London Investment Trust

Man GLG Income

Two value stock opportunities, and the bank share I’ve been buying

The high-yielding shares I am backing to deliver market-beating income

The Super 60 investments list is selected and managed by our independent research partner Morningstar and reviewed by our in-house investment experts to help narrow down the wide choice of available investment products. We believe it represents a set of high-quality choices, across different asset classes, regions, and investment types.

However, you should note that the selection of Super 60 investments list is not a ‘personal recommendation’. This means we have not assessed your investment knowledge, your financial situation (including your ability to bear losses), your investment objectives, your risk tolerance, or your sustainability preferences.

You should ensure that any investment decisions you make are suitable for your personal circumstances, and if you are unsure about the suitability of a particular investment or think you need a personal recommendation, you should speak to a suitably qualified financial adviser.

The past performance of an investment is not a reliable indicator of future results, and ii does not guarantee or predict the future performance of the Super 60 investments list as a whole or the constituent investments.

Risk Warning(s)

The value of your investments may go down as well as up. You may not get back all the money that you invest.

Investing in emerging markets involves different risks from developed markets, in many cases the risks are greater.

The value of international investments is affected by currency fluctuations which might reduce their value in sterling.


All funds listed are the Accumulation version of the fund, where available, where any income generated within the fund is reinvested automatically. Income versions of these funds may also be available for investors looking for income generated to be paid directly into their account.

Annual performance can be found on the factsheet of each fund, trust or ETF. Simply click on the asset’s name and then the performance tab.

Any changes to the Super 60 investments list and the rationale behind those decisions will be communicated through the Quarterly Investment Review.

Details of all Super 60 recommendations issued by ii during the previous 12-month period can be found here.

ii adheres to a strict code of conduct. Members of ii staff may have holdings in one or more Super 60 investments, which could create a conflict of interest. Any member of staff involved in the development of research about any financial instrument in which they have an interest are required to disclose such interest to ii. We will at all times consider whether such interest impairs the objectivity of the recommendation.

In addition, staff involved in the production of the Super 60 investments list are subject to a personal account dealing restriction. This prevents them from placing a transaction in the specified instrument(s) for five working days before and after an investment is included or amended and made public within the Super 60 investments list. This is to avoid personal interests conflicting with the interests of investors in the Super 60 investments.

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