Index trackers and a select few actively managed funds are among the top-performing global equity products in the Singapore and Hong Kong mutual fund universe over three timeframes: year-to-date, three and five years, according to data compiled by FSA.
It has been an unusually volatile environment for global equity investors over the past five years, with three major market corrections in a relatively short period of time.
The fourth quarter of 2018 saw global stocks sell off on fears of the Fed overtightening monetary policy into a growth slowdown. This was followed by one of the sharpest equity market corrections in history due to the global coronavirus pandemic in the first quarter of 2020.
Then global equities entered another bear market starting in the fourth quarter of 2021 as central banks raised interest rates to levels not seen in decades to fight inflation.
Against this volatile backdrop, FSA looked at which international equity funds in the Singapore and Hong Kong mutual fund universe have managed to outperform the wider sector average across three timeframes: year-to-date, three and five years.
Below are the top-20 funds ranked by five-year performance in Singapore and the 10 funds that met the selection criteria in Hong Kong, also sorted by five-year performance.
| Singapore mutual funds | YTD returns (%) | 3yr returns (%) | 5yr returns (%) |
| HSBC Islamic Global Equity Index | 20.2 | 23.95 | 65.68 |
| iShares Global 100 | 15.44 | 37.9 | 64.16 |
| VanEck MSCI World ex Australia Quality ETF | 17.99 | 27.14 | 63.85 |
| M&G Global Sustain Paris Aligned | 10.17 | 34.06 | 50.07 |
| JPM Global Select Equity | 11.12 | 35.81 | 49.7 |
| JPM Global Research Enhanced Index Equity | 11.68 | 30.93 | 47.84 |
| Russell Acadian Global Equity UCITS | 13.24 | 35.96 | 47.12 |
| PineBridge Global Focus Equity | 13.45 | 35.01 | 46.79 |
| iShares MSCI Kokusai ETF | 11.11 | 29.16 | 46.16 |
| iShares Edge MSCI World Quality Factor UCITS ETF | 11.76 | 25.39 | 45.3 |
| Schroder ISF QEP Global Core | 12.25 | 36.63 | 44.28 |
| HSBC MSCI World UCITS ETF NAV | 11.33 | 27.41 | 43.6 |
| iShares Dow Jones Global Sustainability Screened UCITS ETF | 12.92 | 28.25 | 43.1 |
| Invesco MSCI World UCITS ETF | 11.22 | 27.16 | 42.99 |
| iShares Core MSCI World UCITS ETF | 11.17 | 27.03 | 42.49 |
| Dodge & Cox Global Stock | 11.45 | 56.18 | 42.47 |
| Lyxor UCITS ETF MSCI World | 11.2 | 27 | 42.44 |
| Xtrackers MSCI World UCITS ETF | 11.18 | 26.9 | 42.38 |
| Amundi MSCI World Climate Transition CTB AE | 16.21 | 25.42 | 41.81 |
| iShares Developed World Index (IE) | 10.7 | 26.59 | 41.71 |
| Hong Kong mutual funds | YTD returns (%) | 3yr returns (%) | 5yr returns (%) |
| JPM Global Select Equity | 11.12 | 35.81 | 49.7 |
| PineBridge Global Focus Equity | 13.45 | 35.01 | 46.79 |
| Lyxor MSCI World ESG Leaders Extra (DR) UCITS ETF | 12.52 | 26.49 | 44.92 |
| Fidelity Global Industrials | 10.73 | 60.37 | 44.71 |
| HSBC MSCI World UCITS ETF | 11.33 | 27.41 | 43.6 |
| Invesco Global Equity Income | 11.62 | 46.46 | 35.87 |
| Allianz Best Styles Global Equity | 12.62 | 32.19 | 35.56 |
| Amundi HK Green Planet Classic | 11.1 | 23.67 | 35.05 |
| Invesco Pooled Pooled Investment Global Strategic Equity | 12.12 | 27.03 | 34.74 |
| iShares World Equity Index | 9.57 | 21.34 | 33.58 |
According to the data compiled by FE fundinfo, most active funds have struggled to beat their peers across all three timeframes during this bumpy five-year period.
Out of the 605 funds in the Singapore international equity market, just 34 have top-quartile returns year-to-date, over three years and over five years. Almost two-thirds (21) of these were funds tracking an index.
Out of 172 funds in the Hong Kong international equity market, just 10 have outperformed their peers over the three timeframes. Three of these were index-trackers.
In the Singapore market, the top three performers over five years were index trackers. The highest returns came from the HSBC Islamic Global Equity Index. This fund tracks the Dow Jones Islamic Market Titans 100 Index, which is made up of the largest 100 companies traded globally that pass rule-based screens for adherence to Shariah Principles.
The next highest performer was the $4.1bn iShares Global 100 index fund managed by BlackRock, which similar to the above fund, invests in the largest 100 companies listed globally tracking the S&P Global 100 Index.
Index funds have benefitted from their heavy exposure to technology stocks which have formed a large part of the global indices over the past five years. The S&P Global 100 Index for example, has over 41% invested in the top 5 US technology companies Apple, Microsoft, Amazon, Nvidia and Alphabet.
Over the past five years these companies have benefitted from the growth of cloud computing, the pandemic-induced trend towards digitalisation and now the proliferation of AI.
The one thing that differentiates the indices from most active global equity funds, however, is their exposure to energy companies. In 2022 after the invasion of Ukraine by Russia, energy companies benefitted from a spike in energy prices, supporting the indices during times of weakness in technology stocks.
Quarterly performance of MSCI World Energy, Financials and Information Technology sectors over five years
Index trackers have also benefitted from their holdings in financial services stocks like banks and payments companies, which have delivered strong results on the back of rising interest rates and rising inflation – which also lifted the index during times of technology weakness.
When it comes to the active funds that outperformed across all three time-frames, stocks that incorporate a more value-driven approach feature more prominently.
Available both in Singapore and Hong Kong, the JPM Global Select Equity fund stands out with strong returns across all periods.
The $3.6bn dollar strategy employs a bottom-up approach to stock picking and has benefitted more recently to its overweight positions in certain out of favour stocks like Meta and Uber, which have both performed strongly year-to-date.
In the Hong Kong market, the $397m Fidelity Global Industrials fund was another top performer during all time-frames. This fund benefitted from its value-driven approach to focusing on stocks in the both the semiconductor industry as well as the energy industry, both of which have done well recently and over the past five years.
In the Singapore market, the $4.7bn Dodge & Cox Global Stock strategy stands out as a top performer across all periods. This strategy has a value-focused approach to investing, buying well-established companies that the managers think appear to be temporarily undervalued by the market.
