Investment ‘dogs’ named and shamed in funds snapshot

Investors have almost £50 billion tied up in consistently poorly performing funds run by major financial groups including Invesco, St James’s Place and Schroders, according to figures released today.

The number of consistently poorly performing stock market funds has risen by a third over the past year.

The “Spot the Dog” report compiled by platform firm BestInvest lists 119 stock market funds which have underperformed their markets over the past three years, up 33 per cent over the past year.

Fund giant Invesco retains the top dog spot in the league table for the sixth time in a row, with 11 funds holding £9.2bn of assets for investors.

Jupiter moved up to second place after acquiring Merian Global Investors last year. St. James’s Place and Schroders are third and fourth respectively.

Edinburgh-headquartered Aberdeen Standard Investments is listed at tenth, compared to 12th last year, with eight funds with a combined value of just over £2bn.

Jason Hollands, managing director at Bestinvest, said that for investors it can be difficult to recognise that their money is tied up in a poorly-performing fund.

“While 32 of the funds in the report actually lost investors’ money over the last three years most of them didn’t. That’s because stock markets in general have delivered very strong returns over the last decade and so nearly all ships have been lifted by the rising tide, even those with leaks in their hulls” he said.

“If the value of your investments has gone up over the years, it is easy to assume that the fund manager has done an OK job. In reality, their decisions may not be adding any value whatsoever, though you’ll be paying them fees nevertheless.”

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