Interactive Investor

Most-bought investments in December 2020

5th January 2021 12:04

Myron Jobson from interactive investor

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Which funds, trusts and shares were in favour among interactive investor customers?

Industry stalwart Fundsmith Equity was knocked off the top spot of interactive investor’s monthly platform fund bestsellers’ list in December for the first time in recent memory.

Baillie Gifford American pipped Fundsmith Equity to first place in the last month of 2020, ending the latter’s reign at the helm of the fund bestsellers’ list each month since June 2018.

It was a fitting end to a year in which Baillie Gifford dominated the best buy tables, reflecting a swing to active managers after a volatile first quarter for markets. Funds managed by Baillie Gifford accounted for seven of the top 10 fund purchases in December 2020, contrasting to December 2019, when there were no Baillie Gifford funds were in the top 10.

Vanguard LifeStrategy 80% Equity (fourth position) and the 60% Equity variant (eighth position) complete the top 10.

When it comes to investment trusts, the biggest change was City of London (LSE:CTY), which has been ever present on the bestseller list and often the sole UK-focused strategy. It failed to make the cut in December, when not even its 54 years of consecutive annual dividend increases amid a UK dividend drought could spare it from broader malice towards UK equities.

Pershing Square Holdings (LSE:PSH) and Baillie Gifford US Growth (LSE:USA), one of the best-performing funds of 2020, are new entrants on the list, in fifth and ninth positions, respectively.

Platform purchases in 2020 overall

It was a busy year for customer trades on interactive investor, with the platform’s top 10 busiest days of trading all coming in 2020. ii experienced its busiest day ever for customer trades on 9 November after news of Pfizer’s (NYSE:PFE) Covid vaccine sent markets into a frenzy.

Overall, the prevailing theme for 2020 was global, with global strategies accounting for eight out of 10 funds and investment trust bestsellers, respectively. Conversely, investors’ appetite to the UK remained soured. City of London and Finsbury Growth & Income (LSE:FGT) are the only two investment trust to make the cut.

China-focused funds and investment trusts also picked up more investor interest towards the end of 2020 – arguably because the country and a host of other Asian countries appear to have fared better at controlling the virus. 

Active was the flavour of the year, with actively managed funds making up six of the 10 fund bestsellers – four of which are portfolios run by Baillie Gifford.

Three funds from Vanguard’s popular LifeStrategy suite and L&G Global Technology Index Trust make up the passive contingent on the list.

Teodor Dilov, fund analyst at interactive investor, says: “What a year it has been for investors, who’ve witnessed a steep fall in markets and a dramatic recovery with a number of bumps in between. One of the biggest winners of the year is Baillie Gifford, boasting a number of funds and investments trusts that have become firm favourites among our customers to steer them through what has been a Covid storm. Having come close in previous months, Baillie Gifford American finally managed to knock Fundsmith Equity off the number-one spot of the funds bestsellers' list in December - a milestone moment.

“The slant towards active solutions among our customers in 2020 is unsurprising as active managers earn their corn in volatile markets, such as the prevailing stock-market conditions, by attempting to beat their benchmark market index by cherry-picking stocks and chopping and changing them to take advantage of perceived inefficiencies in the market. However, funds in Vanguard’s LifeStrategy range have also proven to be the most popular passive options of choice on interactive investor over the past year.

“The biggest losers are UK funds, which fell out of favour amid the Brexit uncertainty. But with Brexit now out of the way, a reasonable allocation to the UK could provide diversification and potential recovery opportunities in 2021.”

On the bestselling equities, Richard Hunter, head of markets at interactive investor, says: “December continued the overall 2020 theme for ii customers, who saw the benefit later in the year of some recovery in beaten-down stocks which stand to profit by a return to some kind of normality.

“As such, the most-bought shares included the likes of the airline and airline-related stocks (International Consolidated Airlines (LSE:IAG), easyJet (LSE:EZJ) and Rolls-Royce (LSE:RR.)), while the potential for a recovery in oil demand was reflected in BP (LSE:BP.) and Shell (LSE:RDSB) appearing in the list. Meanwhile, the buying sentiment also extended to the banks, where an improvement in economic fortunes post-pandemic could mitigate some of the billions of pounds already taken in bad debt provisions this year, and where the return of dividend payments in 2021 could add some spice – Lloyds Banking (LSE:LLOY) topped the list, with Barclays (LSE:BARC) also in the top 10.

“In a sign of the times, the previously little-known clinical diagnostics group Novacyt (LSE:NCYT) had a stratospheric year in light of the pandemic. The shares rose by almost 5,800% during 2020 and ii customers were early adopters of the buying trend.”

Top 10 most-bought funds, investment trusts and equities on interactive investor in December 2020

Fund Investment trust Equity
BAILLIE GIFFORD AMERICAN SCOTTISH MORTGAGE  (joint second) LLOYDS BANKING GP
FUNDSMITH EQUITY EDINBURGH WORLDWIDE (joint second) ROLLS ROYCE HLDGS
BAILLIE GIFFORD POSITIVE CHANGE MONKS INTL CONS AIRLINE
VANGUARD LIFESTRATEGY 80% EQUITY  PACIFIC HORIZON  ASTRAZENECA
BAILLIE GIFFORD GLOBAL DISCOVERY PERSHING SQUARE HOLDINGS BP
BAILLIE GIFFORD PACIFIC  FIDELITY CHINA SPECIAL SITUATIONS  GLAXOSMITHKLINE
BAILLIE GIFFORD CHINA ALLIANZ TECHNOLOGY EASYJET
VANGUARD LIFESTRATEGY 60% EQUITY BLACKROCK WORLD MINING TRUST VODAFONE GROUP
BAILLIE GIFFORD LONG TERM GLOBAL GROWTH  BAILLIE GIFFORD US GROWTH TRUST BOOHOO GROUP PLC
BAILLIE GIFFORD MANAGED JPMORGAN CHINA GROWTH TESLA INC

Top 10 most-bought funds, investment trusts and equities on interactive investor in 2020 overall

Fund Investment trust Equity 
FUNDSMITH EQUITY SCOTTISH MORTGAGE  LLOYDS BANKING GP
BAILLIE GIFFORD AMERICAN POLAR CAPITAL TECHNOLOGY TRUST  BP
VANGUARD LIFESTRATEGY 80 ALLIANZ TECHNOLOGY INTL CONS AIRLINE
BAILLIE GIFFORD POSITIVE CHANGE  CITY OF LONDON  ROLLS ROYCE HLDGS
BAILLIE GIFFORD GLOBAL DISCOVERY EDINBURGH WORLDWIDE BOOHOO GROUP PLC
VANGUARD LIFESTRATEGY 60% EQUITY SMITHSON  ROYAL DUTCH SHELL
LINDSELL TRAIN GLOBAL EQUITY MONKS  BARCLAYS PLC
VANGUARD LIFESTRATEGY 100  WORLDWIDE HEALTHCARE NOVACYT
LEGAL & GENERAL GLOBAL TECHNOLOGY INDEX TRUST ALLIANCE TRUST EASYJET
BAILLIE GIFFORD CHINA FINSBURY GROWTH & INCOME  GLAXOSMITHKLINE

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 data 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.

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