FUND FOCUS: International Equities
Best performer YTD: New Ireland Bloxham Geared Megacap Fund +12.5%
Worst performer YTD:Aviva LP Blackrock World Energy Fund -11.4%
AS TURMOIL remains the order of the day on global markets, funds invested in international equities are returning varying amounts, depending on the investment strategy pursued.
According to MoneyMate, in the first nine months of the year to September 3rd, Irish gross domestic funds invested in international equity returned 4.8 per cent on average, or 16.4 per cent over the previous 12 months.
Top of the bunch is the New Ireland Bloxham Geared Megacap Fund, which is up by 12.5 per cent so far this year and by 28 per cent in the 12 months to September 3rd. The fund is benefiting from a drive towards more stable names in a weakening macroeconomic environment, with a weak euro also providing a currency bounce.
The fund, which has a three- year fixed term, was launched in September 2007 to take advantage of a discount perceived among “megacaps”. They are the largest companies on global indices and, as of the end of August, the fund’s top holdings were in BHP Billiton, Pepsico, Microsoft and Tesco.
However, while the fund has posted a very strong performance so far this year, investors who allocated money to it back in 2007 are “highly unlikely” to get a return when it matures in November, notes Paul O’Brien, fund manager with Bloxham Stockbrokers, due to the turbulence of the past few years.
At the other end of the scale is the Aviva Blackrock World Energy Fund, which invests at least 70 per cent of its assets in the equity securities of companies whose predominant economic activity is in the exploration, development, production and distribution of energy. It is down by 11.4 per cent so far in the year to September 3rd, but has returned 1.7 per cent over the past 12 months.
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Last week’s column gave the return for the AXA Financial Blackrock UK Index fund in sterling, unlike the other mentioned fund which was denominated in euros. The comparable return on the AXA fund so far in the year to August 27th was 5.02 per cent, or 13.8 per cent in the previous 12 months.
On that basis, the poorest performing UK Equities fund over the period is Absolute Insight Funds UK Equity Market Neutral AP fund, which returned 0.57 per cent in the year to August 27th, or 0.2 per cent in the previous 12 months.
