Interactive Investor

Lockdown one year on: best-performing funds and trusts

22nd March 2021 16:47

Myron Jobson from interactive investor


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interactive investor names the funds and investment trusts that have performed best.

After a tough year emotionally, socially, and for many, economically, the first anniversary of the UK Covid-19 lockdown tomorrow is pause for reflection.

For investors, stock market volatility always brings winners and losers but even those who reaped the rewards of buying on the March 2020 stock market lows will not want a rerun of the past awful year.

interactive investor crunched the numbers to see which funds and investment trusts have performed best almost 12 months on. The data shows how contrarian investments can sometimes pay off – although some come with a bigger health warning than others and are literally ‘nuclear.’

Richard Hunter, Head of Markets, interactive investor, says: “Since 23 March 2020, the FTSE 100 has added 36%, the FTSE 250 66% and the FTSE All-Share 42%.

“The strongest recovery has been seen in the FTSE 250, a more domestically focused index, which has seen the particular benefit of the removal of some Brexit uncertainty and where, arguably ,the strength of sterling is less of an issue than the premier index.

“Latterly the FTSE 100 has been seeing increasing attention from international institutional investors who had previously shunned the index for some time. The extremely successful roll-out of the vaccine in the UK, the removal of some uncertainties and the cheapness of the index on valuation grounds are beginning to combine, with the FTSE 100 currently ahead by 5% in the year to date.”

US and UK-focused funds and investment trusts have excelled over the past 12 months on from the 23 March to 15 March 2021.

US-focused funds account for four of the top 10 best performers including fund heavyweight Baillie Gifford American (returning 130% over the period), but it was a UK Smaller Companies fund, Premier Miton UK Smaller Companies Fund, which topped that charts - up 180%. Marlborough Nano Cap Growth fund ( 121%), another UK Smaller Companies fund, also made the top 10 list.

Legg Mason Royce US Small Cap Opportunity ranks in second position (158%) and Junior Gold (145%) in third.

Investment trusts

UK-centric portfolios also featured in the top 10 among investment trusts: Chelverton UK Dividend Trust (LSE:SDV) (157%); Miton UK Microcap (LSE:MINI) (156%) and Aberforth Split Level Income (LSE:ASIT) (120%).

A niche, £34 million investment trust topped the charts - Geiger Counter (LSE:GCL) which invests in companies involved in the exploration, development and production of uranium to supply the nuclear power industry, with a return of 292%.

However, as investors may expect with a niche strategy, and just as all short-term performance should be taken with a pinch of salt, this investment trust has had some big bumps in the road, with the share price down significantly the year before, for example.

Scottish Mortgage (LSE:SMT) (120%) and Baillie Gifford US Growth (LSE:USA) (149%) also made the top 10.

Teodor Dilov, Fund Analyst, interactive investor, says: “One of the more remarkable stories is the reversal of fortunes of the UK market. UK equities have experienced somewhat of a revival over the past 12 months, albeit from the market low, with greater certainty over Brexit following the UK/EU trade deal and the Bank of England tipping the UK economy to claw back almost all the ground lost during the Covid-19 pandemic over the next year.

“Far from the bleak outlook of yesteryear, the Bank of England’s forecast reflects a marked change of tone for the UK economy – further bolstered by the arrival of coronavirus and the UK’s rapid roll-out rate. That said, only eternal optimists would want to overlook potential bumps in the road.

“It is also true that the recovery in the UK market does not quite mirror the pace of advance on the other side of the pond. The influence of the outperformance of the tech sector over last year cannot be denied, with the outperformance of the so-called FAANG stocks (Facebook (NASDAQ:FB), Amazon (NASDAQ:AMZN), Apple (NASDAQ:AAPL) Netflix (NASDAQ:NFLX)and Alphabet (NASDAQ:GOOGL)’s Google) turbocharging the US market and the portfolios investing in them. The recent volatility we have seen in the tech sector again illustrates the importance of portfolio diversification – and is another reminder that one year’s winners might not be tomorrow’s.”

Top 10 best-performing funds since 23 March 2020 (to 15 March 2021)

Fund Name IA sector Return
Premier Miton UK Smaller Companies Fund UK Smaller Companies 180.76
Legg Mason Royce US Small Cap Opportunity Fund North American Smaller Companies 157.64
Junior Gold Trust Specialist 144.51
Marlborough Technology Fund  Technology and Telecommunications 136.47
Schroder ISF Global Energy Fund Global 133.11
Baillie Gifford American Fund North America 129.97
Marlborough Nano Cap Growth Fund UK Smaller Companies 121.01
New Capital US Small Cap Growth Fund North American Smaller Companies 115.06
GlobalAccess US Small & Mid Cap Equity Fund North American Smaller Companies 113.92
Wells Fargo (Lux) WF US Select Equity Fund Global Bonds 113.88

Top 10 best-performing investment trusts since 23 March 2020 (to 15 March 2021)

Name AIC sector Return
Geiger Counter Trust Commodities & Natural Resources 291.51
Chelverton UK Dividend Trust UK Equity Income 157
Miton UK Microcap Trust UK Smaller Companies 156.42
CQS Natural Resources Growth and Income Trust Commodities & Natural Resources 155.77
Baillie Gifford US Growth Trust North America 148.91
Pacific Horizon Trust Asia Pacific 146.18
TR European Growth Trust European Smaller Companies 120.43
Scottish Mortgage Trust Global 119.85
Aberforth Split Level Income Trust UK Smaller Companies 119.61
Edinburgh Worldwide Trust Global Smaller Companies 117.51

Source: interactive investor/Morningstar as at 15 March 2021. Total Returns in GBP. Investment trust returns are based on NAV. 

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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