August's 10 most-bought funds

Fundsmith Equity, one of our sister magazine Money Observer's Rated Funds, has taken the top position among the most-bought funds on the Interactive Investor platform once again.

Managed by the highly regarded manager Terry Smith, the fund has over half of its assets in US equities. Five months ago it toppled CF Woodford Equity Income, and it has remained the most-bought fund ever since.

The top four most-bought funds in August remain unchanged from July. Neil Woodford's eponymous open-ended UK equity income fund, which launched in June 2014, took second place again in August. It has returned 1.9% over one month to 1 September and gained 8.2% over the last year.

Money Observer Rated Fund Lindsell Train Global Equity is third on the list. Jointly managed by Michael Lindsell and Nick Train since its launch in March 2011, the fund returned 15.4% over three months to 1 September.

Passive popularity

Passive funds gained in popularity in August on the back of strong performance from the UK and other global markets they track, with five of our most-bought funds in August being passive ones.

The fourth place in the list was taken by Vanguard LifeStrategy 80% Equity, which focuses on North American equities, UK equities and European ex UK equities as well as holding 20% in global bonds.

It was closely followed by Vanguard LifeStrategy 100% Equity, which climbed six spots to reach fifth place on the list, and Vanguard LifeStrategy 60% Equity in sixth place.

The seventh place in the top 10 was taken by HSBC FTSE All Share Index, which climbed an impressive 10 spots. It highlights the return in confidence and good performance of companies in the internationally oriented FTSE 100 index post-Brexit.

Artemis Global Income climbed two spots to be the eighth most-bought fund in August. It benefits from a global spread, as one third of its holdings are in US equities, about 13% in UK equities and 8% in German equities.

Biotech and gold funds slip

Axa Framlington Biotech has dropped two spots to take the ninth spot in August's most-bought list.

Managed by Linden Thomson, the biotech fund has struggled over the last year, losing 9% as the wider biotech sector took a hit following uncertainty around drug pricing in the US as well as unrealistic valuations.

Recently the sector's valuations have benefited from some successful mergers and it gained 13% over the last three months. It is worth noting that the specialist fund has gained an astonishing 263% over the last five years.

The list was topped off with another passive fund, the HSBC FTSE 250 Index, which gained 3.7% over one month. This indicates that not only the FTSE 100, but also the more domestically oriented mid-cap index, has benefited from a boost in confidence.

Further down the list, it is interesting to note that safe-haven gold fund BlackRock Gold & General has dropped 11 places, from sixth to 17th spot in August.

The fund owns stakes in 50 gold and silver miners and returned 30% over the last three months as precious metals like silver and gold are seen by investors as a hedge of "real value" against central banks electronically creating more and more money through their various quantitative easing schemes.

But the specialist fund is highly volatile and gold's ascent faltered in August. Over the last month the fund lost 12%.

This article was originally published by our sister magazine Money Observer here

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.