Investors shunned their home market in July, with global equity funds and trusts most in demand on the interactive investor platform. Graeme Evans reports.
Global equity funds and trusts continue to dominate investor choices on the interactive investor platform, with many of the top picks in July also being weighted towards the technology sector.
The extent to which investors shunned their home market during July is shown in the fact that our top 10 list of the most popular funds failed to register a single UK-focused fund or trust.
Whilst July proved to be another volatile month for markets, the US was, yet again, the place to invest. The S&P delivered a 3.7% return and, despite some shock results, the Nasdaq put in a positive performance, rising 2.2%.
Fundsmith Equity retained its top spot in the most bought funds table, followed once again by Lindsell Train Global Equity.
The two global equity funds have long been popular with investors and have delivered consistently strong performances in recent years with their high conviction buy and hold strategy.
Fundsmith and Lindsell Train have delivered returns of 17.8% and 24.2% respectively over the past 12 months, and 147.6% and 134.6% over the past five years.
Rebecca O'Keeffe, Head of Investment at interactive investor, noted that Fundsmith founder Terry Smith's recent foray into Facebook will have hurt a little, given the vicious market reaction to the US behemoth's worse than expected results.
But, she added:
"Investors are happy to put their faith in these active managers, which have handsomely benefited their investors in recent years."
Scottish Mortgage Ord, which has a heavy weighting toward the tech sector, was the most-purchased trust in July, a position it has held for over a year and a position it is unlikely to lose any time soon.
It attracts more than three times as many buys into the trust than its nearest rival. Number two in the most bought trust list was Allianz Technology Trust Ord.
Both trusts have significant exposure to the US and both have Amazon.com Inc as their largest holding - with nearly 10% of Scottish Mortgage's portfolio held in the online giant.
Further down the list of most popular investment trusts are two UK-focused picks in the shape of Finsbury Growth & Income Ord, which rises four places to fifth, and the new entry NewRiver REIT.
O'Keeffe said another category conspicuous for its absence in recent months is emerging markets, which has suffered significantly over the past year as global liquidity conditions begin to tighten.
"Most of the current popular funds and trusts have very low exposure to this area and ii investors have done well so far this year to avoid this region."
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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.