Interactive Investor

Tech funds dominate top purchases on interactive investor in January

5th February 2020 13:51

Myron Jobson from interactive investor

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There was a resurgence in the popularity of technology funds in January, as Lindsell Train UK Equity slipped off the list of top 10 fund purchases on interactive investor, the UK’s second largest direct to consumer investment platform.

Having failed to register on the top 10 bestsellers list in December, technology funds accounted for three of the top positions in January.

L&G Global Technology Index ranks highest in fifth position, ahead of Fidelity Global Technology in sixth and AXA Framlington Global Technology in ninth. 

LF Lindsell Train UK Equity was the seventh bestselling fund in November, tenth in December, but failed to make the cut in January for the first time since September 2018 – falling to 19th place. The fund was downgraded by two independent external agencies towards the end of 2019. interactive investor chose to keep the fund on its Super 60 rated list following a formal review conducted on 29 November 2019 and completed on 19 January 2020.

Meanwhile, Lindsell Train Global Equity, which has often tussled with Fundsmith Equity for the number one spot, slipped three places into seventh. 

Vanguard once again dominates the bestsellers list, scooping four of the top 10 spots.

Three of these come from Vanguard’s popular LifeStrategy range, with the 80% Equity variant in second, ahead the 60% and 100% equity options in third and fourth positions respectively. 

Investment trusts

Technology also proved to be a popular theme on the investment trust front. Of the two tech centric investment trusts on the list, Polar Capital Technology (LSE:PCT) ranks highest in fourth position – four places ahead of Allianz Technology Trust (LSE:ATT) in eighth.

Scottish Mortgage (LSE:SMT) remains rooted at the top of the table – boasting a record as the most purchased investment trust on the interactive investor platform month in, month out since February 2014, except once.

City of London (LSE:CTY) came in second, with Renewables Infrastructure Group (LSE:TRIG), which invests in assets generating electricity from renewable sources, completing the top three.

UK Smaller Companies were easily the theme of December, but BlackRock Throgmorton Trust (LSE:THRG) was the sole trust investing predominately in the sector to make the top 10 list in January.

Finsbury Growth & Income (LSE:FGT) in sixth and JPM Emerging Markets in seventh are familiar names on the list, while Henderson Far East Income (LSE:HFEL) makes the list in tenth.

Teodor Dilov, Fund Analyst, interactive investor, says: “Considering the fact that large cap technology names in the US and the tech industry in general have been the growth engine over the recent years, it no surprise that customers investing for growth still seek to gain exposure to this theme.

“However, it should be noted that current valuations in this sector are at historical highs. Taking into account that the economic cycle is maturing and growth stocks have been dominating their value peers for the past decade, investors should take extra care when reviewing their exposure. In addition, tech specific vehicles should be regarded as a satellite holding within a well-diversified portfolio as this is a very specialist area which involves a higher degree of risk.”

Dzmitry Lipski, Head of Funds Research, interactive investor, says: “The derating of Lindsell UK Equity Fund by two external agencies over liquidity fears may have raised questions for some investors. But having done extensive analysis on the liquidity, capacity and concentration of Lindsell Train UK Equity, we are comfortable with the liquidity of the fund, since the majority of the holdings are large, liquid companies with diversified revenue streams. 

“In terms of capacity, there is plenty of room for further growth without compromising the mandate. The fund has always had a concentrated, high conviction approach but has a low turnover and long-term successful track record.” 

Most bought funds, investment trusts and shares in January 2020

Fund Investment trust
Fundsmith Equity Scottish Mortgage
Vanguard LifeStrategy 80% Equity City of London
Vanguard LifeStrategy 60% Equity The Renewables Infrastructure Group
Vanguard LifeStrategy 100% Equity Polar Capital Technology Trust
L&G Global Technology Index Trust BlackRock Throgmorton
Fidelity Global Technology Finsbury Growth & Income
Lindsell Train Global Equity JP Morgan Emerging Markets
Vanguard US Equity Index Allianz Technology
AXA Framlington Global Technology Smithson
Baillie Gifford American Henderson Far East Income

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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