New Elite Rated funds
Following its inaugural quarterly investment committee meeting, leading UK fund ratings agency FundCalibre has awarded an Elite Rating to another six funds. The new additions will take the number of Elite Rated funds to 115.
1. Old Mutual Global Equity Absolute Return
This features in the Chelsea Selection.
As the absolute return space gets more crowded with myriad complex strategies, it is getting more difficult for investors to decipher which funds can be genuinely categorized as absolute return. The Old Mutual Global Investors fund is one successful absolute strategy run by Ian Heslop and team. This fund has done what it says on the tin by producing strong absolute performance in recent years, demonstrating its ability to generate genuine alpha. It is, however, slightly more volatile that other funds in the sector.
2. Smith & Williamson Enterprise
Another absolute return fund, the Enterprise portfolio is run by Rupert Fleming, Mark Swain and Mark Boucher and targets a return of 8% to 10% per annum irrespective of market conditions.
The Smith & Williamson fund has held up during recent market volatility, producing a positive return during the September to October drawdown period, underlining its alpha-generating credentials in tough market conditions.
3. F&C Multi-Manager Navigator Distribution
Gary Potter and Rob Burdett have long established themselves as a talented investment duo capable of strong long-term outperformance. Their flagship £1bn multi-manager portfolio scores highly for its consistent outperformance and reliable yield.
What also impressed FundCalibre was the increasing strength of the team – at nine-strong it is one of the largest in the multi-manager space. Their habit of identifying lesser known funds for inclusion in their portfolio has been shown to generate alpha.
4. Rathbone Strategic Growth
The first risk-targeted fund on the Elite list, David Coombs’ portfolio sits in the IMA Unclassified Sector but the FundCalibre investment committee has assessed it according to its benchmark of LIBOR plus 3%, and the Mixed Investment 20%-60% shares sector, which the investment committee sees as a natural peer group. The portfolio scored highly on both these counts. Post global financial crisis, outcome-orientated strategies have proved increasingly popular and this is one of the stand-out performers.
5. Invesco Perpetual Hong Kong & China
This is currently within our Core Selection.
This fund run by Mike Shiao since June 2012, has been awarded Elite Rated status due to the manager’s longer track record on an offshore version of the portfolio. The investment committee also likes the depth of the team's resource in Hong Kong, which combines local knowledge with a deep well of experience.
6. Hermes Asia ex-Japan
This fund featured in the boutique section of the Viewpoint.
With a number of high profile Asia ex-Japan funds closed to new investors, this fund has displayed stellar outperformance in its sector and against the benchmark. The manager Jonathan Pines has run the portfolio since launch
All six funds passed the FundCalibre's rigorous AlphaQuest process.
To achieve Elite Rated status a fund must first pass the quantitative process, which has been designed to isolate a fund manager’s ability to outperform the market or respective sector over at least three years. The volatility of a manager’s “skill” is then assessed to determine the probability of repeating outperformance in the future.
Fund managers who achieve at least 60% probability of long-term outperformance then have to pass a second qualitative process in which the manager is analysed in order to receive the Elite Rating.
Darius McDermott, the managing director of FundCalibre, said:
“We continue to search for managers who are able to generate alpha after fees. We do not expect to add a significant number of funds at each quarterly meeting, but instead aim to find only the best of the best; the latest additions are all run by highly impressive managers,”
At Chelsea we rate the funds in a different manner, so you may find different funds within the Selections than those in the Elite Rated list.
Schroder UK Opportunities, Threadneedle UK and Henderson European Growth, previously Elite Rated, have been removed from the list after managers Julie Dean, Simon Brazier, and Richard Pease announced they are to leave their respective positions as lead fund managers.
FundCalibre is an independent online research centre and fund ratings agency, which is freely available to all investors. The FundCalibre investment research team analyses funds which are widely available to UK retail investors and identifies those which they believe have the most skilful managers. These funds are awarded a proprietary Elite Fund rating.
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