After the bond market turmoil of 2022 upended the traditional diversification strategy of the 60/40 portfolio, some investors were looking for equity funds that exhibit low volatility without sacrificing returns.
Equity funds with lower volatility can be appealing to investors who prioritize the preservation of capital over aggressive growth, or who prefer a smoother ride to reduce potential knee-jerk reactions to market volatility.
As such, FSA highlights five global equity strategies available for distribution in Singapore or Hong Kong with top-ranked returns as well as top-ranked low volatility based on data from FE fundinfo*.
Fidelity Global Equity Income
This fund delivered a five-year cumulative return of 71.77% and had five-year annualised volatility of 13.88%, the lowest on this list.
This compares to the Singapore Mutual Equity International sector average five-year return of 50.43% and volatility of 17.77%.
The strategy is managed by Fidelity’s Aditya Shivram.
Guinness Global Equity Income
This $5.3bn fund invests in companies that pay sustainable growing dividends. It is managed by Ian Mortimer and Matthew Page.
It delivered a five-year cumulative return of 69.68% and had five-year annualised volatility of 15.92%.
JPM Global Dividend
This $3.5bn fund invests in companies that generate high and rising income. It is managed by Helge Skibeli, Sam Witherow and Michael Rossi.
It delivered a five-year cumulative return of 75.73% and had a five-year annualised volatility of 17.23%.
Schroder ISF Global Equity Alpha
This $2.8bn global equity strategy invests in stocks that have strong growth potential yet to be recognised by the market. It is managed by Alex Tedder and Frank Thormann.
It delivered a five-year cumulative return of 73.74% with a five-year annualised volatility of 17.17%.
This $13.6bn growth-orientated global equity strategy is managed by Andre Köttner of DWS.
It delivered a five-year cumulative return of 73.58% and five-year annualised volatility of 16.08%.
*The performance data is in US dollar terms, five years to the date ending 18/12/2023. The five-year cumulative volatility data is to month end 31/11/2023. The risk-free rate used was 3.5%. Fund ISIN codes: LU0994413051, IE00BVYPNW00, DE0008476524, LU0225283273, LU0329201957, respectively.