Money Management has looked at the top-performing high-and-low-risk Australian equity funds in the Australian Core Strategy universe over the three years to 31 July to see whether high-volatility funds are in fact a risk worth taking.
Data from FE Analytics has shown that you don’t in fact need to invest in high-risk funds to get good returns, with the top performing fund in the sector running at a FE Risk Score of 109 – just a little higher than that of the S&P ASX 300 Index, which was 100.
To put this quantitatively, the volatility of the top fund, the Bennelong Concentrated Australian Equity fund, which returned 20.09 per cent, was 11.4 per cent, and the volatility of the ASX 300, which returned 8.08 per cent was 12.07 per cent.
The second-best fund in the sector was the SGH Australia Plus fund, which returned 16.94 per cent for the same time frame, and had a Risk Score of 90, making it less volatile than the index while bringing in more than double the returns.
The chart below shows the performance of the top two funds as compared to the ASX 300 for the three years to 31 July.
Four other funds sat in the top 10 in terms of performance and had below-average volatility, with Risk Scores ranging from 90 to 97, showing a split mix between above-average volatility and below-average volatility funds bringing home high returns.
For those looking for a little more risk, Ausbil’s Australian Geared Equity fund sat just outside the top 10 in twelfth position with 13.49 per cent returns, but more than doubled the index’s volatility with a Risk Score of 230.
AMP’s AFS Australian Equity Value Plus 1 fund had the highest Risk Score in the index at 255, and produced returns just outside the top 20 with 11.8 per cent.
The funds with the lowest Risk Scores produced similarly low returns, with the top four low-risk funds producing between -1.43 per cent and 6.03 per cent returns.
The table below shows the volatility and risk scores of the top ten funds in the Australian equity sector for the three years to last months end.
|
Name
|
3 year Cumulative Performance to Last Month End |
3 year Cumulative Volatility to Last Month End |
FE Risk Score
|
|
Bennelong Concentrated Australian Equity ATR in AU |
20.09 |
11.4 |
109 |
|
SGH Australia Plus ATR in AU |
16.94 |
9.15 |
90 |
|
Macquarie Australian Shares ATR in AU |
16.68 |
11.21 |
97 |
|
DDH Selector Australian Equities ATR in AU |
16.31 |
11.19 |
124 |
|
L1 Capital Australian Equities ATR in AU |
14.71 |
10.09 |
110 |
|
Macquarie Active Plus Equities ATR in AU |
14.27 |
11.26 |
97 |
|
SGH 20 ATR in AU |
14.09 |
9.78 |
94 |
|
Bennelong Australian Equities ATR in AU |
13.96 |
11.17 |
108 |
|
Macquarie Wholesale Australian Equities ATR in AU |
13.93 |
11.15 |
97 |
|
Ganes Value Growth ATR in AU |
13.83 |
10.65 |
102 |
