Posted inHead To Head

HEAD-TO-HEAD: Invesco vs iShares

FSA compares the Invesco Korean Equity Fund with iShares MSCI Korea Ucits ETF, the largest of Korea equity ETFs, which have outperformed all active funds in the past year.
by Fund Selector Asia
Performance

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Three-year performance of the Invesco Korean Equity Fund and the iShares MSCI Korea Ucits ETF, compared to MSCI Korea and Kospi indices and the sector average of SFC-registered funds. Data: FE, in US dollars.

Cumulative performance over one- and three-year periods shows an astonishing difference and supports the argument for passive investing. The Invesco fund was in negative territory while the iShares ETF had double-digit gains.

However, during certain calendar years, the Invesco fund outperformed the index.

Jeong adopted the current core quality investment philosophy in 2010, following his initial period of more traditional benchmark-following approach. The change brought good results, as the fund outperformed in five out of the past seven calendar years. In 2014 and 2015 in particular, the fund returned 10.7% and 19%, respectively, while the market indices, the ETFs and the sector average of active funds all experienced losses.

The two years in which the fund underperformed were 2012 and 2016. Both these years saw cyclical stocks rally, and the core quality approach underperformed.

“Jeong knew it would happen,” said Ng, “but he believes that over the long-term, investors in his fund won’t have to suffer the ups and downs [of cyclical stocks] and will be able to outperform the market.”

  Invesco Korean Equity iShares MSCI Korea Ucits ETF
1 Year Return -10.36 35.14
3 Year Return -1.67 16.24
1 Year Volatility 17.97 14.97
3 Year Volatility 21.90 18.13
Alpha (3-yr) -0.38  
Beta (3-yr) 1.01  
Info Ratio (3-yr) -0.1  
Sharpe Ratio (3-yr) -0.1  
Data: FE. Figures are cumulative.

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