Best performing investment funds uk - opinion you
Top investment funds
How to use this data
The tables on this page showcase the best-performing funds including both active and passive or index funds.
You may see more specialist fund types featuring as the best-performing funds across the various timeframes. Such funds tend to invest in a single country, sector or commodity, and are deemed more suitable for adventurous investors as they carry greater levels of risk than more conventional funds, such as a global or regional fund.
Funds can be held in an ISA, SIPP, and other investment accounts. Tax treatment depends on your individual circumstances and may be subject to change.
Please do bear in mind that past performance is not a guide to future performance. The tables on this page simply offer a snapshot of the best-performing funds. Further research should be carried out to assess performance across different timeframes and market conditions. Moreover, it is prudent to look at performance on a yearly basis in order to ensure a strong long term performance track record is not just the result of one outstanding year.
The performance figures show the total return in sterling unless otherwise specified. Figures are calculated on a bid price to bid price basis or mid to mid for open-ended investment companies (OEICS), with net income (dividends) reinvested.
Investment Funds
Tips and reviews on the best performing investment trusts for UK private investors. We regularly review the market to provide ratings tables and lists, as well as ask fund managers and analysts to name the best investment funds and provide unique fund tips and insights.
Funds are often a popular choice to house savings and therefore it is one of the investing sectors where people like to do a great deal of research themselves. To help readers search through the wide range of options, our articles concentrate on investments that offer great potential for success.
We try to cover all industry sectors and markets, drawing together information on funds that give the best chance of strong returns for the risk being taken. Our investing philosophy is mainly focused around funds that are intended for long-term investors (10 to 20 years) looking for stable returns, but we will occasionally highlight some shorter-term options (3 to 5 years) where strong income opportunities exist for a little extra risk.
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British smaller companies were the biggest investment winner in the first half of the year, according to new analysis, while so-called ‘old economy’ stocks have pushed their way to the top of the FTSE 100 leaderboard.
The UK's FTSE small cap index climbed 19.4 per cent to beat major markets from around the world, including the FTSE 100, S&P 500 and Japan's Topix, according to AJ Bell research.
And the DIY investing platform said that investors in UK smaller company funds saw the best sector returns, with the average fund up 20 per cent over the first six months of the year.
Five of the top ten performing funds invest in UK smaller companies, the best of which was Aberforth UK Smaller Companies, which was up 32 per cent. That paled in comparison to the leader of the FTSE 100 pack Royal Mail, however, which rose 71 per cent.
'Old economy' stock Royal Mail has been an unlikely winner during the pandemic, seeing its share price soar 71 per cent this year
FTSE small caps are stand out winners
UK shares have staged a comeback in recent months, largely down to the success of the vaccine rollout and the cyclical rally of the past six months, where companies that do well as the economy improves lead the way.
Investors have been largely bullish on UK stocks since the start of the year, even in the face of new coronavirus variants.
There has been something of a sea change in attitudes towards the UK stock market in recent months. The rapid vaccination programme has been widely touted as underpinning the recovery, while the diminishing impact of Brexit issues has also boosted confidence.
This bounceback saw the FTSE 100 post a total return of 10.9 per cent in the first half of the year, but it still lags behind the US market.
‘The Footsie is still playing second fiddle to the US stock market despite the rally in value stocks which make up such a big slug of UK plc,’ Laith Khalaf, AJ Bell’s financial analyst said.
Playing a part here is the huge US stimulus introduced. Alongside its vaccine rollout and lesser lockdown restrictions, the US has committed $400billion in cash payments to US adults, while Congress has agreed a $1.2trillion to a new infrastructure investment package.
‘The real stand out winner of the year to date has been the UK Smaller Companies market, which has enjoyed an incredibly hot streak of performance,’ Khalaf said.
The FTSE Small Cap index has soared to record highs and is around 20 per cent higher than pre-pandemic levels.
This represents something of a vote of confidence in the economy - the Bank of England has forecast 4 per cent GDP growth in the second quarter of 2021 alone - given that the index has a larger exposure to domestic revenues than the blue chip FTSE 100, which is trading around 10 per cent lower.
| H1 total return (%) | |
|---|---|
| FTSE 100 | 10.9 |
| MSCI AC Asia Pacific ex Japan | 5.7 |
| MSCI Europe ex UK | 12.3 |
| S&P 500 | 14.0 |
| TSE TOPIX | 0.5 |
| FTSE Small Cap | 19.4 |
Khalaf suggests it is also a sign of investors positioning themselves for a risk-on market, which is when stocks outperform the less risky bond market.
While small caps may have benefited from vaccine rollout optimism, the exact opposite has happened for bond funds which have had a ‘pretty grisly year so far’.
‘Bonds can still offer portfolio diversification, but it’s hard to maintain a positive outlook on the asset class, particularly at the longer dated end of the market, given such low yields and a global economy that looks like it’s beginning to take off,’ Khalaf said.
Gilts are government bonds which means they are particularly sensitive to changes in interest rates. Prices rise when the BoE cuts the interest rate and fall when it goes up.
As such mounting inflation, which could lead to the central bank hiking the base rate, could see further sell-offs in the market.
‘It would be a shock to bond investors who have enjoyed a long bull market, and who generally invest in these assets because they’re risk averse,’ Khalaf added.
The UK 10-year gilt is currently yielding just 0.73 per cent, but that is up from just under 0.2 per cent at the start of the year.
| First half total return (%) | |
|---|---|
| Best performing funds | |
| CCM - Intelligent Wealth | 33.1 |
| Consistent - Opportunities | 32.6 |
| Guinness - Global Energy | 32.3 |
| Aberforth - UK Small Companies | 32.0 |
| Liontrust - UK Micro Cap | 31.2 |
| CFP Castlefield - B.E.S.T Sustainable UK Smaller Companies | 29.3 |
| Aviva Inv - UK Smaller Companies | 29.0 |
| Guinness - Global Money Managers | 28.5 |
| VT - De Lisle America | 28.4 |
| Marlborough - Nano Cap Growth | 27.5 |
| Worst performing funds | |
| Smith & Williamson - Global Gold & Resources | -13.0 |
| LF Ruffer - Gold | -13.1 |
| WS - Charteris Gold & Precious Metals | -13.5 |
| Ninety One - Global Gold) | -13.8 |
| HSBC - MSCI Indonesia UCITS ETF | -14.3 |
| ES - Baker Steel Gold & Precious Metals | -16.3 |
| iShares - Global Clean Energy UCITS ETF | -17.5 |
| HSBC - MSCI Turkey | -21.3 |
| LF - Equity Income | -33.3 |
‘Old economy’ stocks stage a comeback
The rise of the high stakes lockdown DIY investor has captured headlines this year, particularly off the back of people trading high octane so-called ‘meme stocks’ and cryptocurrencies.
AJ Bell said a sign of this is how UK-listed firms Argo Blockchain has been used by investors to gain exposure to the crypto markets.
But it was old economy shares that posted the best FTSE 100 gains, as growth expectations and the prospect of rising inflation has prompted discussions about a rotation into value stocks.
Royal Mail led the way - as it rode a pandemic parcel delivery boom - with a 71 per cent gain, while international construction equipment rental specialist Ashtead racked up a 56 per cent rise.
| First half share price performance % | |
|---|---|
| Best performing shares | |
| Royal Mail Group | 71 |
| Ashtead Group | 56 |
| Entain | 54 |
| BT Group | 46.7 |
| Kingfisher | 34.8 |
| Glencore | 32.8 |
| St James's Place | 30.3 |
| Lloyds Banking Group | 28.1 |
| Johnson Matthey | 26.7 |
| Evraz | 25.5 |
| Worst performing shares | |
| Informa | -8.63 |
| Avast | -8.87 |
| Rolls Royce Group | -11.1 |
| London Stock Exchange Group | -11.5 |
| Ocado Group | -12.4 |
| Melrose Industries | -12.9 |
| Flutter Entertainment | -13 |
| Just Eat Takeaway.com | -19 |
| Tesco | -23.9 |
| Fresnillo | -31.7 |
The FTSE 100 took a significant hit at the start of the pandemic but has since staged an impressive recovery, in part because it is so strongly weighted towards value stocks like financials.
Indeed, Lloyds Bank has been a strong favourite among investors with the share price climbing just over 35 per cent in the year-to-date.
Ladbrokes owner Entain has also seen its stock rise 54 per cent as it pivots to online amid betting shop closures.
‘The top end of the FTSE 100 performance table carries a distinct whiff of the old economy,’ Khalaf said. ‘While communications, logistics and gambling are longstanding industries, these markets have moved with customers, and the times.’
‘Royal Mail takes a turn on delivering parcels ordered by consumers online, BT owns the mobile network EE, and Entain derives most of its revenues from online betting and gaming.’
Elsewhere AJ Bell’s analysis shows DIY investors are seeking out bargains and piling into other value stocks like British Airways owner IAG and Rolls Royce.
Growth funds continue to dominate the list of most popular funds but there has been a shift in investor preference. Jupiter UK Special Situations and Blackrock World Mining have seen rising demand look to the recovery.
‘Some investors are positioning themselves in more cyclical areas, in preparation for an economic recovery, and perhaps inflation,’ Khalaf said.
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Best-Performing Mutual Funds of March 2022
When shopping for mutual funds, we naturally are curious: Which ones are performing the best today?
While that’s a common place to begin your search, remember you’re shopping for tomorrow when looking for the best mutual funds. Top performers in the short term don’t always become long-term winners. The best mutual funds for your portfolio won’t necessarily be the best for your parents, your siblings or your neighbors.
» Looking to fund an IRA before tax day? See our picks for best IRA accounts.
Best-performing U.S. equity mutual funds
To determine the best mutual funds measured by five-year returns, we looked at U.S. equity funds open to new investors with low costs (expense ratios of 1% or less) and minimum investment requirements of $3,000 or less.
For more on how to choose a mutual fund, skip ahead to this section.
Pax Large Cap Fund Individual Investor |
Goldman Sachs Capital Growth Inv |
Pear Tree Quality Ordinary |
American Century Sustainable Equity Inv |
Fidelity Series All-Sector Equity |
Parnassus Core Equity Investor |
State Street US Core Equity Fund |
T. Rowe Price U.S. Equity Research |
Data current as of March 4, 2022. Data provided by Morningstar, a NerdWallet advertising partner. Retirement and institutional funds were excluded.
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How to choose the best mutual funds for you
NerdWallet’s recommendation is to invest primarily through mutual funds, especially index funds, which passively track a market index such as the S&P 500. The mutual funds above are actively managed, which means they try to beat stock market performance — a strategy that often fails.
» Ready to invest?Here's our picks for best brokerages for mutual funds.
When you're ready to invest in funds, here's what to consider:
Decide whether to invest in active or passive funds, knowing that both performance and costs often favor passive investing.
Understand and scrutinize fees. A broker that offers no-transaction-fee mutual funds can help cut costs.
Build and manage your portfolio, checking in on and rebalancing your mix of assets once a year.
» Learn more:How to invest in mutual funds
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Average mutual fund return
Managing your portfolio also means managing your expectations, and different types of mutual funds should bring different expectations for returns.
Stock mutual funds = higher potential returns (or losses)
Stock mutual funds, also known as equity mutual funds, carry the highest potential rewards, but also higher inherent risks — and different categories of stock mutual funds carry different risks.
» Related:Best performing stocks this month
For example, the performance of large-cap high-growth funds is typically more volatile than, say, stock index funds that seek only to match the returns of a benchmark index like the S&P 500. (Learn more about stock mutual funds versus index funds.)
» Related:25 best performing high-dividend ETFs
Bond mutual funds = lower returns (but lower risk)
Bond mutual funds, as the name suggests, invests in a range of bonds and provide a more stable rate of return than stock funds. As a result, potential average returns are lower.
Bond investors buy government and corporate debt for a set repayment period and interest rate. While no one can predict future stock market returns, bonds are considered a safer investment as governments and companies typically pay back their debt (unless either goes bust).
Money market mutual funds = lowest returns, lowest risk
These are fixed-income mutual funds that invest in top-quality, short-term debt. They are considered one of the safest investments you can make. Money market funds are used by investors who want to protect their retirement savings but still earn some interest — often between 1% and 3% a year. (Learn more about money market funds.)
Focus on what matters
Chasing past performance may be a natural instinct, but it often isn't the right one when placing bets on your financial future. Mutual funds are the cornerstone of buy-and-hold and other retirement investment strategies. Hopping from stock to stock based on performance is a rear-view-mirror tactic that rarely leads to big profits. That's especially true with mutual funds, where each transaction may bring costs that erode any long-term gains.
What's important to consider is the role any mutual fund you buy will play in your total portfolio. Mutual funds are inherently diversified, as they invest in a collection of companies (rather than buying stock in just one). That diversity helps spread your risk.
You can create a smart, diversified portfolio with just a few well-chosen mutual funds or exchange-traded funds, plus annual check-ins to fine-tune your investment mix.
Disclosure: The author held no positions in the aforementioned investments at the original time of publication.
Which investment trusts performed the best in 2021?
The Indian stockmarket’s benchmark indices Sensex and Nifty 50 ended 2021 with gains of 22% and 24% respectively, which explains Ashoka’s presence among Cheviot’s best performers.
Compared with other investment trusts in India, Ashoka stands out. For instance, Aberdeen New India Investment Trust (LSE: ANII) rose by about 16%.
Other stand-out performers included Tufton Oceanic Assets (LSE: SHIP) which invests in shipping vessel and performed well at a time when economies globally are grappling with supply-chain disruptions.
Also performing well was Geiger Counter (LSE: GCL), which focuses predominantly on the uranium industry. It has benefited from a rise in uranium prices, which have gained around 40% since August to touch $43 a pound.
An analysis of all the trusts (including private-equity firms) and their portfolios indicated that information technology (IT), fintech, finance, and retail stood out as the overarching themes among other sectors such as e-commerce, aerospace, cybersecurity, mining, and energy.
The weakest-performing investment trusts from 2021
| Share price total return 2021 | |
|---|---|
| Baillie Gifford Shin Nippon | -17.2% |
| Fidelity China Special Situations | -17.5% |
| Syncona | -18.8% |
| Golden Prospect Precious Metal | -20.6% |
| Edinburgh Worldwide | -20.9% |
| Petershill Partners | -21.6% |
| Biotech Growth | -24.6% |
| JP Morgan China Growth & Income | -25.2% |
| Baillie Gifford China Growth | -28.6% |
| DP Aircraft Limited | -74.8% |
| Source: JP Morgan & Quilter Cheviot, as at 31/12/2021 | |
The laggards for the year included three names from growth-focused investment house Baillie Gifford, even as Schiehallion (LSE: MNTN), owned by the same group, was the best-performing trust with returns of over 100%.
Baillie Gifford Shin Nippon (LSE: BGS), which invests in smaller Japanese companies, lost 17%. Among its key holdings are companies focusing on semiconductors, clothing, and helmets.
Edinburgh Worldwide (LSE: EWI), meanwhile, which has significant holdings in Elon Musk-owned Tesla Inc and Space Exploration Technologies, also lost 20% as high-growth, low-profit companies fell out of favour amid concerns about rising interest rates.
“Baillie Gifford will naturally go through some difficult periods as a result of their growth style of investing, but it remains a quality investment house with first rate research capabilities. It would be no surprise to see these trusts bounce back in 2022, although maybe not delivering the same level of performance as their Schiehallion stablemate,” said Wood.
Two biotech-focussed funds, Syncona and Biotech Growth, found themselves in the bottom ten as well.
What about 2022?
The UK’s largest China Investment Trust, Fidelity China Special Situations (LSE: FCSS) along with JP Morgan China Growth & Income trust (LSE: JCGI) also featured among the worst-performing trusts, impacted by regulatory risks in the mainland and a volatile year for equities. Baillie Gifford China Growth (LSE: BGCG) had similar problems, losing 28% last year, unsurprising given China’s struggles last year.
So, will China continue underperforming its peers in 2022? Dale Nicholls, portfolio manager at Fidelity, argues that in the new year, the Chinese market may see healthy corporate earnings coupled with attractive valuations and fewer policy surprises.
As for India, hopes are high that it will continue to do well in 2022, particularly as investors China. For instance, Mobius Investment Trust (LSE: MMIT), owned by emerging market fund manager Mark Mobius has most of its assets parked in India – 28% – nearly triple its allocation in China.
Top investment funds
How to use this data
The tables on this page showcase the best-performing funds including both active and passive or index funds.
You may see more specialist fund types featuring as the best-performing funds across the various timeframes. Such funds tend to invest in a single country, sector or commodity, and are deemed more suitable for adventurous investors as they carry greater levels of risk than more conventional funds, such as a global or regional fund.
Funds can be held in an ISA, SIPP, best performing investment funds uk, and other investment accounts. Tax treatment depends on your individual circumstances and may be subject to change.
Please do bear in mind that past performance is not a guide to future performance. The tables on this page simply offer a snapshot of the best-performing funds. Further research should be carried out to assess performance across different timeframes and market conditions. Moreover, it is prudent to look at performance on a yearly basis in order to ensure a strong long term performance track record is not just the result of one outstanding year.
The performance figures show the total return in sterling unless otherwise specified. Figures are calculated on a bid price to bid price basis or mid to mid for open-ended investment companies (OEICS), with net income (dividends) reinvested.
The performance data shown in tables and graphs on this page is calculated in GBX of the fund/index/average (as applicable), best performing investment funds uk, on a Bid To Bid / Nav to Nav basis, with gross dividends re-invested on ex-dividend date. Past performance is not necessarily a guide to future performance; unit prices may fall as well as rise.
The videos and white papers displayed on this page have not best performing investment funds uk devised by The Financial Times Limited ("FT"). FT has not selected, modified or otherwise exercised control over the content of the videos or white papers prior to their transmission, or their receipt by you. The videos, white papers and other documents displayed on this page are paid promotional materials provided by the fund company. Any prospectus you view on this page has not been approved by FT and FT is not responsible for the content of the prospectus.
The information made available to you does not constitute the giving of investment advice or an offer to sell or the solicitation of an offer to buy any security of any enterprise in any jurisdiction. The securities listed above are not registered and will not be registered for sale in the United Sates and cannot be purchased by U.S. investors as the securities can only be purchased in jurisdictions where they have been registered for sale or where an exemption from registration applies. The offer, best performing investment funds uk, sale or delivery of the securities within the United States or to, or for the account or benefit of, U.S. Persons is not permitted except pursuant to an exemption from registration under U.S. securities laws, which may not be available; and the availability of the information through the website does not alter or change the persons eligible to purchase the security.
All managed funds data located on FT.com is subject to the FT Terms & Conditions
All content on FT.com is for your general information and use only and is not intended to address your particular requirements. In particular, the content does not constitute any form of advice, recommendation, representation, endorsement or arrangement by FT and is not intended to be relied upon by users in making (or refraining from making) any specific investment or other decisions.
All data shown on this page, unless noted otherwise is Data Source and Copyright: Morningstar, Inc. 2022
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© 2022 Morningstar. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible best performing investment funds uk any damages or losses arising from any use of this information. Past performance is no best performing investment funds uk of future results.
Pricing for ETFs is the latest price and not "real time". Share price information may be rounded up/down and therefore not entirely accurate. FT is not responsible for any use of content by you outside its scope as stated in the FT Terms & Conditions.
Morningstar Rating(TM) The Morningstar Rating(TM) for funds, best performing investment funds uk, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar RiskAdjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three- five- best performing investment funds uk, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36- 59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.
Past performance isn't a guide to future returns. Source: HL, Broadridge, correct as at 31/01/2022. Performance data provided by FE correct as at previous working day. Prices provided by Morningstar.
Any gaps in performance data means figures aren’t available.
The HL Select Funds are run by our sister company Hargreaves Lansdown Fund Managers Ltd.
Yields vary and aren't a reliable guide to the income you'll get in future.
Wealth Shortlist This fund features on our Wealth Shortlist of funds chosen by our analysts for their long-term performance potential.
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