The FSA Spy market buzz – 22 November 2024
Dimensional excludes the Middle Kingdom; JP Morgan’s optimistic outlook; Household wealth is rocketing; Schroders is thinking about privates; Ninety One’s pithy AI; German woes and much more.
HEAD-TO-HEAD: JPMorgan vs MFS
FSA compares two European equity products: the JPMorgan Europe Dynamic Fund and MFS Meridian European Research Fund.
The three-year cumulative performance of the JPMorgan and MFS funds versus their benchmark indices.
Source: FE. Fund NAV is converted to US dollars for comparison purposes.
On a three-year cumulative basis, the JPMorgan fund returned -0.14%, underperforming its benchmark index, the MSCI Europe (0.16%).
Over the same period, peer funds in the category delivered -0.07%.
Meakin said that the investment strategies result in different drivers for the two funds.
“The MFS fund may not be able to do well in the market that shoots up quickly, driven by companies with lower quality,” Meakin said. “You might expect that in a sharp rising market led by such companies, the fund might even lag the index.”
As the JPMorgan fund is dominated by lower-quality companies, he added that the fund is likely to capture the upside in this kind of environment.
The MFS fund, on the other hand, has outperformed both peers and its benchmark. In the three-year period through March 2018, the fund had a 2.58% return.
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