The FSA Spy market buzz – 22 March 2024
AllianzGI on China stewardship, Death of the mutual fund, W’s top financial centres, Schroders on Japan, Swiss cuts and Japanese hikes, Reddit, Book wisdom and more.
Introduction
There have been better alternatives than the UK stock market for dollar-based investors during the past few years.
Sluggish economic performance and protracted Brexit instability has led to underperformance against other equity markets, and a chaotic policy response to the Covid-19 pandemic has meant that recovery from the late-March nadir for risk assets has lagged other indices.
While the MSCI All Country World Index has bounced back vigorously from the February-March shock, and has a cumulative three-year return of 26.42% in US dollar terms, the FTSE All Share Index is still in the red, down 9.07%, according to FE Fundinfo.
The poor relative return is equally stark over a longer period. The UK benchmark is down 0.24% over five years and up an anemic 40.97%, compared with the broadly-based MSCI benchmark, which has risen 61.97% and 147.16% respectively, FE Fundinfo data shows.
Clearly, it’s been a tough decade for UK equity fund managers, but Darius McDermott, managing director of Chelsea Financial Services, compares for FSA a couple of products run by two of the best-regarded managers in the sector: the Merian UK Alpha Fund and the Schroder ISF UK Equity Fund.
Merian | Schroders | |
Size | $44m | $72m |
Inception | 2013 | 2001 |
Managers | Richard Buxton | Alex Breese |
Three-year cumulative return | -14.08% | -27.96% |
Three-year annualised return | -5.52% | -10.83% |
Three-year annualised alpha | -4.18 | -4.81 |
Three-year annualised volatility | 24.75% | 25.17% |
Three-year information ratio | -0.57 | -1.09 |
Morningstar star rating | *** | – |
Morningstar analyst rating | Silver | – |
FE Crown fund rating | * | * |
OCF (clean share class) | 1.95% | 2.34% |
AllianzGI on China stewardship, Death of the mutual fund, W’s top financial centres, Schroders on Japan, Swiss cuts and Japanese hikes, Reddit, Book wisdom and more.
Part of the Mark Allen Group.