The last decade has been one that has been dominated by central banks providing support for risk assets through quantitative easing and this has had a remarkable impact on asset price returns and also helped drive certain parts of the market higher, according to AJ Bell.
Decade of dreams – top funds
“Looking at mainstream investments, Japanese smaller companies have been the stand out area over the decade with the Legg Mason Japan Equity fund, managed by Hideo Shiozumi, leading the tables, growing by nearly 700% over the last ten years. Interestingly, a look back at the previous decade shows us that this very same fund was the 2nd worst performer of that decade showing just how things have changed as quantitative easing has driven markets higher.
“The last decade feels like a transformative period for technology and it is therefore unsurprising that technology funds feature heavily in the best performers. Polar Cap Global Technology has led the way, helped by its high quality management team, and other technology funds have also made the top ten. With so much of the US market driven by technology, US equity funds also made the top ten with Baillie Gifford American clearly capitalising on its growth style.
“The other clear theme of the decade is UK smaller companies with Slater, Merian and Liontrust all showing their stock picking prowess over a long period.”
Decade of disaster – worst funds
“After being the top performer of the previous decade, commodities have certainly struggled over the last ten years with gold, oil and other commodity funds all taking a pounding. The MFM Junior Gold fund has been the biggest faller, losing nearly 75% of its value while their Junior Oils fund also lost nearly 70%.
“The reliance of commodities on the Brazilian market also meant that country specific funds made the list of shame with HSBC and Pictet both seeing their Brazil funds at the bottom of the charts.
“Away from commodities, the Garraway Absolute Return fund delivered anything but this, with a fall of nearly 35% making it a miserable decade for long term investors.”
Decade of dreams – top trusts
“The last ten years have been a dream for Lindsell Train as their quality growth style has absolutely dominated. This has propelled the Lindsell Train investment trust to the top of the tables with returns of a remarkable 870%. The main driver for this is the 50% holding in its own management company which has seen assets in the firm climb to over £20bn and investor sentiment has been so strong that the trust stands at a 30% premium having at one stage hit the dizzy heights of 90%.
“Unsurprisingly, the themes seen in open ended funds have been replicated in investment trusts with Japanese smaller companies, UK smaller companies and technology all performing strongly. Honourable mentions should go to the likes of Baillie Gifford, Henderson and BlackRock amongst others for delivering huge returns for investors.”
Decade of disaster – worst trusts
“The investment trust universe brings with it lots of unusual and niche investment types and this leads to a wide range of different types of investments performing poorly. While no obvious theme persists, the appearance of the India Infrastructure Trust and African Infrastructure Opportunities showing huge losses shows just how hard it can be to make money in high risk markets such as these.”