Quality stocks drive strong performance in 2017
The quality-focused stock pickers have delivered strong performance in 2017, while the median Australian shares manager managed to outperform the S&P/ASX 300 Accumulation index by one per cent, according to Mercer’s investment survey.
Looking at the longer-term periods of three and five years to December, the survey found that the median manager outpaced the same index by 1.1 per cent and 1.6 per cent, respectively.
According to the survey, the Australian equities asset class benefitted from buoyant global sentiment which saw index rise by 7.7 per cent in the December quarter.
Other positive factors included US corporate tax cuts, China’s commitment to a rate of growth unchanged from last year which was supportive of resource demand, benefitting miners with higher quality resource grades.
Yee Hou Seck, an Australian Equities Researcher in Mercer’s Manager Research Group, said: “We have noticed that the leading strategies had some commonalities in stock exposures that drove portfolio returns, both in large and small caps.”
“The names that stood out from the S&P/ASX 100 include CSL and Aristocrat Leisure, with returns of 42.6 per cent and 55 per cent respectively, and outside the S&P/ASX 100, IDP Education and Reliance Worldwide, with returns of 58.3 per cent and 22.7 per cent respectively.”
The best performing sectors in the broader index included Information Technology (+26.1 per cent), healthcare (25.9 per cent), materials (22.7 per cent) and energy (22.4 per cent) with the weakest sectors being telecom services (-20.7 per cent) and financials (5.3 per cent).
According to Mercer’s survey, the top five performers among the Australian shares manager were:
- Bennelong Concentrated Equities (30.74 per cent)
- Selector High Conviction Equity Fund (26.01 per cent)
- Platypus Australian Equities (24.17 per cent)
- Alleron Growth (23.97 per cent)
- Macquarie High Conviction (23.11 per cent)
The bottom five funds were:
- Russell Australian Value Premium (6.20 per cent)
- Janus Henderson High Conviction Australian Equity (7.97 per cent)
- Lazard Aust Equity (8.72 per cent)
- Investors Mutual Concentrated Australian Shares (8.77 per cent)
- Investors Mutual Australian Share Fund (9.03 per cent)
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