Four top-rated funds drop to lowest Crown rating
There are four funds that have gone from 5 Crowns to just 1 in the latest rebalance of the FE fundinfo Crown ratings.
BMO LGM Global Emerging Markets, Bentham High Yield, Legg Mason Martin Currie Real Incom and PIMCO Capital Securities Wholesale all saw the significant drop-off.
Two of the funds – Bentham’s and PIMCO’s – sat in the diversified credit sector, while the BMO fund sat in the emerging markets equity sector.
The Legg Mason fund was an Australian equity fund, but it sought to provide a growing income stream by investing diversified assets such as Australian real estate investment trusts (AREITs), utilities and infrastructure.
Its strategy was built around listed real assets sustaining dividends, matching the cost of living and being less volatile than the broader equity market and was subsequently hit hard by the reduction of dividends due to the COVID-19 pandemic.
Martin Currie chief investment officer, Reece Birtles, and portfolio manager, Will Baylis, had previously written to Australian Securities Exchange (ASX) companies reminding them of the “power of dividends” for retirees.
“In such difficult economic times, and with an uncertain market outlook, the benefits of both dollar income and franking credits to retirees cannot be underestimated,” they said.
“Retirees are key beneficiaries of these dividends, and they have worked hard to have sufficient capital to fund their own retirement.”
However, the Real Income fund had noted that it was well-positioned to meet the challenges currently faced in the market.
“During the COVID-19 related broad market sell-off in March, real assets saw unprecedented GFC-like [Global Financial Crisis] market falls and were, unusually, one of the weakest sectors,” the fund said.
“However, given that real assets are used every day – even in a recession – and form the tangible building blocks of society, they are the first companies to benefit as State and Federal Governments ease restrictions.”
AUTHOR
Chris Dastoor
Recommended for you
Statutory NPAT at Pacific Current has almost halved in FY25 to $58.2 million as the result of an investment restructure.
Being able to provide certainty about redemptions is worth fund managers pursuing when targeting the retail market even if it means sacrificing returns, according to Federation Asset Management.
Regal chief investment officer Philip King will step down from listed investment company VGI Partners Global Investments after the LIC reported a loss of $17.6 million for FY25.
Real asset commentators have shared what advisers should be considering when conducting their due diligence on the assets and how they can mitigate illiquidity for retail clients.
