Interactive Investor

Rated Funds list primed to perform

26th August 2014 09:44

Andrew Pitts from interactive investor

It is now six months since our Rated Funds list for 2014 was published. Since then, we have had our annual fund and trust awards.

One aim of these awards, as with our Rated Funds process, is to highlight products we believe are delivering consistently good returns in their sectors.

In our half-year Rated Funds review to 1 July, we are therefore adding some fund and trust award winners to the list, along with some extra global growth and UK growth selections.

Global growth and UK growth are two core investment areas for investors and, in retrospect, we feel our original listing was a bit light in these two key sectors.

Prime attractions

The additional editor's selections that caught our eye are mainly funds with relatively focused investment approaches that set them apart from some more mainstream funds.

We believe managers with this type of mindset are one of the prime attractions of actively managed funds.

However, as with all our Rated Funds, it is important that investors consider how they are invested overall and whether a fund suits their individual requirements.

Where investment trusts are listed, investors also need to check that the share price has not risen to a premium over net asset value that now makes them unattractive.

A general half-year review of existing Rated Funds has also been carried out. We do not intend to chop and change our choices too often, so only one fixed-interest fund has actually been removed from the list, following a change of manager.

However, we have put some products that are not performing quite as well as we had hoped under review.

When you construct a portfolio of funds, you do not necessarily expect all of the constituents to move in the same direction at once. It is often better to own funds that perform well in different market conditions.

On the other hand, fund managers can sometimes lose their mojo, so we need to keep an eye out for that.