Which are the global equity winners?
Five global equity funds have been identified as having provided strong performance during the choppy market volatility this year.
According to Morningstar, the first four funds that had performed well were Franklin Global Growth, GQG Partners Global Equity, Magellan Global and T. Rowe Price Global Equity.
“Over the first half of the year, growth and quality-growth managers performed better. Fortunately some of our favourites performed well through a choppy period,” it said.
“Avoiding cyclicals (like energy and financials) and loading up on higher-quality companies with more attractive growth prospects served these strategies well.”
As well as these four funds, BetaShares Global Sustainability Leaders ETF also picked for its move towards high-growth technology names, away from a focus on the energy sector.
According to FE Analytics, since the start of the year to 31 August, all five of these funds had reported positive returns with the best-performing fund on the list being T. Rowe Price Global Equity which had returned 18.3%.
Within the Australian Core Strategies universe, the global equity sector, which contained 260 global equity funds, lost 1.09% over the same period.
Performance of five funds versus the global equity sector since start of the year to 31 August 2020
The T. Rowe fund was also upgraded by the company for its “healthy amount” invested in emerging market stocks which gave the strategy a different risk profile to its peers.
On the other hand, value-focused funds suffered as they had less exposure to technology names and had holdings which were economically-sensitive. Morningstar said value-focused funds had delivered higher downside capture and higher volatility than growth ones during the pandemic.
This included funds from Dimensional, Barrow Hanley and PM Capital.
Only one of the five Dimensional global equity funds, Global Sustainability Trust Unhedged, outperformed the sector average and it still made a loss of 0.9%, according to FE Analytics. The worst was Global Value Trust which lost 20.5% since the start of the year to 31 August.
AUTHOR
Laura Dew
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