Experienced investment teams focused on the sectors most emergent from the COVID-19 pandemic represented the success stories in the latest FEfundinfo Crown Fund Ratings rebalance.
The rebalance covered fund manager performance to the end of December, last year, so reflected economic and market conditions influenced by the economic and political events which occurred ahead of the significant vaccine rollouts which have marked the start of 2021.
And as the markets moved through what effectively represented 10 months of a global pandemic, the quantitative data underpinning the Crown ratings revealed that reputations can take a battering in uncertain times, particularly for those managers focused on global equities.
The bottom line in terms of investment team experience has been reflected in the five-crown performances of IOOF and First Sentier Investors, while the importance of choosing the right companies in the right sectors was reflected in those managers focused on Australian small and mid-cap equities.
As Laura Dew has written elsewhere in this coverage of the Crown Ratings, Australian small and mid-cap equities had the highest percentage of 5 Crown rated funds – something which appears to have reflected the manner in which the Australian economy began to regather the momentum which had been lost amid the lock-downs and job losses of the first half of 2020.
That regathering of economic momentum fed into funds such as SGH Emerging Companies, UBS Microcap, Pendal MicroCap Opportunities, Macquarie Australian Emerging Companies and DMP Australian Small Caps Trust all being upgraded.
By comparison, some big names and some robust strategies took a beating in the global equity sector with the Magellan High Conviction, Janus Henderson Intech Global All Country Managed Volatility ex Australia and Montgomery Global all finding themselves moving down.
But for those mangers who emerged well from the latest Crowns rebalance, the key appeared to be maintaining discipline in the face of volatility, with Colchester’s head of distribution, Angela MacPherson, emphasising the value of staying focused.
IOOF chief investment officer, Dan Farmer also referenced the benefits of the scale which had been delivered from its acquisition of ANZ Wealth.