The 10 most popular investment funds – February 2018

Money Observer 2018 Rated Fund Fundsmith Equity once again took the top position in the table of  most-bought funds on Money Observer's sister website Interactive Investor. The fund is managed by highly regarded investor Terry Smith, and it has over half of its assets in US equities such as Microsoft and PayPal. 

Lindsell Train Global Equity, another 2018 Rated Fund, went up by two places to take second spot on the list. Jointly managed by Michael Lindsell and Nick Train, the fund has returned 6.1 per cent over the past six months to the end of February, despite the market falls earlier in the month, and 22 per cent over one year.

It was followed by2018 Rated Fund Legg Mason IF Japan Equity in third place. Managed by Tokyo-based veteran Hideo Shiozumi, the fund focuses on high-growth businesses successfully exploiting the structural changes taking place in Japan. It has 27 per cent of its holdings in healthcare and 26 per cent in industrials. It returned 41 per cent over one year and has returned an astonishing 161.4 per cent over three years. 

Passive tracker Vanguard LifeStrategy 80% Equity went up by two places to become the fourth most popular fund in February. This was despite disappointing returns over one and three months and one-year gains of just 3 per cent. The tracker focuses on North American equities, UK equities and European ex UK equities as well as global bonds. 

-Warren Buffett: investors should stick to low-cost tracker funds

Baillie Gifford Greater China was fifth, slipping from second place last month. After facing fears of a hard landing, the Chinese economy remained resilient last year, and the country’s GDP is expected to grow by some 6 per cent this year. 

Going up by three spots, Vanguard LifeStrategy 100% Equity came sixth in the list. The tracker returned 3.6 per cent over one year and 35.9 per cent over three years. 

Jupiter India, a Money Observer 2018 Rated Fund run by Avinash Vazirani, one of the UK’s most experienced Indian equity investors, went down by two spots to seventh place.

The fund has underperformed over the short term and shed 9.4 per cent over the last six months, but gained 35 per cent over the last three years. India is one of the world’s fastest-growing economies driven by urbanisation, with almost 70 per cent of the population aged under 35 - a fact helping to shape the manager’s stock-picking approach. 

The third tracker fund of the list, Vanguard LifeStrategy 60% Equity, came eighth in the list. It has been rising up and down the list over the last months.

Money Observer 2018 Rated Fund Baillie Gifford Japanese Smaller Companies came ninth - further evidence of the fact that investors continue to feel positive about the prospects for Japan. The country was an investor’s favourite last year, and valuations continue to look cheap compared to the developed markets of the US and UK. 

Investor optimism has also been boosted by Japan's low unemployment rate, and the fact that GDP has expanded for six straight quarters - the longest sustained bout of growth since before the global financial crisis. 

Henderson Global Technology went down by three places to tenth on the list. With 80 per cent of its holdings in the US, where most technological innovation comes from, the fund’s holdings include Facebook, Microsoft, Alphabet and Apple, which were the main drivers of US growth last year. It returned 21 per cent over one year, and 80.2 per cent over three years.

Henderson China Opportunities dropped out of the top ten list in February to make way for the Vanguard LifeStrategy 60% Equity fund.

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