Eleven sectors have had higher than average amounts of funds awarded the lowest FE Crown Rating on one crown, with the ACS Property – Global sector being the worst performer.
The FE Crown Ratings system gives eligible funds a ranking between one and five crowns. The bottom performing 25 per cent of funds based on alpha, volatility and consistency of performance over the last three years receive one crown, with the next 25 per cent being a
The ACS Property – Global had 52.50 per cent of funds, or 21 of a total of 40, receive a one crown rating, which was more than double the average across all funds. With a further 37.50 per cent of funds in the sector awarded two crowns, 90 per cent of ACS Property – Global’s funds were placed in the bottom two categories of ratings.
The sector did not compensate for its poor performing funds with highly rated funds, with only half as many funds being awarded five crowns as the average.
The largest fund in the sector to receive just one crown was the AMP Capital Global Property Securities fund, which has $1,594.1 million funds under management (FUM). Its annualised returns over the three years to 30 November, 2017 were 5.25 per cent, placing it in the 87th percentile for the sector.
Advance’s Global Property fund and Macquarie’s Hedged Index Global Real Estate Securities fund also received only one FE Crown. With $636.8 million and $381.1 million FUM respectively, they are the next two largest funds in the sector to receive the lowest rating.
The ACS Alternative sector also performed poorly, with 52.24 per cent of funds being awarded one crown. It had a lower than average amount of funds receiving four crowns though, at 11.94 per cent, meaning that the overall portion of funds in the bottom two ratings was not dramatically higher than average (64.18 per cent, as opposed to the average of 50 per cent).
It also had higher than average amounts of funds to receive the top rating of five crowns, though. The sector had 17.9 per cent of funds awarded the highest honour, compared to the average across all funds of 10 per cent.
warded two crowns.
