Despite the large outflows for the IA UK All Companies sector, and amidst the uncertainty of a ‘no deal’ Brexit and handling of the coronavirus, there are some funds that have managed to see significant inflows over the past year.
With that in mind, Trustnet has looked at funds that were under £500m in size this time last year (as at end-August) to see how they have grown, finding that some have added to their funds under management considerably despite the uncertainty.
However, it would be unfair to compare smaller funds with some of the funds at the larger end of the scale. So, as well as flow data, percentage change has been considered to represent the change in size.
Data from FE Analytics shows the performance effect on size, which represents the gain/loss in the size of the fund related to the change in value of the underlying portfolio holdings.
The underlying approximate in-/outflow is the underlying change in size attributable to investor in-/outflows over the year period, however, it must be noted that this is an approximation.
It must also be noted that there have been funds below our £500m threshold which have shed money in the past year.
UK funds under £500m with greatest inflows over 1yr
Source: FE Analytics
At the top of our list is the MI Chelverton UK Equity Growth fund, managed by James Baker and Edward Booth.
A year ago, the fund was £332.96m in size, whereas it is now it stands at £722.33m, representing a 54 per cent increase with underlying approximate inflows of £328.48m.
Launched in 2014, the fund invests solely in UK listed equity securities that are outside of the top 100 companies by market cap. The growth-focused fund is a top quartile performer over one, three and five years and has an FE fundinfo Crown Rating of four.
With approximate inflows of £251.97m over one year, the ASI UK Equity fund is second on the list. With a fund size today of £420.95m, it has seen a 57 per cent increase from £180.59m a year ago.
Managed by Andrew Millington and – until recently – Louise Kernohan since 2018, the fund focuses on high-quality stocks and takes a long-term approach to investing. However, like most funds in the sector, it has suffered a negative performance impact on its size, recording a loss of £11.61m.
The only passive strategy on the list is the Vanguard FTSE 100 Index Unit Trust, which was £116.1m in size in September 2019 but has grown to £420.95m, representing a 62 per cent increase over 12 months. Approximately £207.17m has flowed into the tracker fund over this time frame, despite also being impacted by poor performance of UK equities.
Nevertheless, inflows into passive strategies perhaps signal growing optimism in the stability of the UK market, which is reminiscent of the large uptick in FTSE 100 trackers following Boris Johnson’s election in December 2019.
The £622.01m Liontrust Sustainable Future UK Growth fund also passed the £500m threshold this year, having been £445.14 in size a year ago. Managed by Peter Michaelis and Martyn Jones, they have overseen growth of 27 per cent, which equates to inflows of approximately £162.96m.
The BlackRock UK Equity fund also saw strong inflows as funds under management rose by 33 per cent, rising from £299.82m to £445.14m.
Performance of funds vs sector over 1yr
Source: FE Analytics
One notable entry on the list, is the L&G Future World ESG UK Index, which has seen a 93 per cent increase in size over the last year. Rising from £15.54m to £238.66m in the space of 12 months, this equates to a performance effect of £89.16m on size.
This perhaps represents a growing awareness of investors to environmental, social & governance (ESG) strategies.
The fund aims to provide both growth and income by tracking the performance of the Solactive L&G ESG UK index.
UK funds under £500m with greatest outflows over 1yr
Source: FE Analytics
Conversely, there are some funds under £500m which didn’t enjoy the kind of inflows of the funds listed above have. In fact, they have endured some difficult outflows during the last year.
The Schroder Prime UK Equity fund had £476.06m in assets this time last year, but now stands at £185.21m in size, marking a 157 per cent drop. This reflects approximately £245.1m in outflows over 12 months. Managed by Andrew Simpson, Matt Bennison and Sue Noffke, recorded a loss of 12.97 per cent over one year.
Performance of funds vs sector over 1yr
Source: FE Analytics
The Fidelity Institutional UK fund also shrank by 71 per cent in size over the last year, going from £255.2m to £149.53m. Overseen by Nick Peters and Ayesha Akbar, the fund has made a loss of 8.36 per cent year-to-date.