- by Suki Mann
Here’s a look at how the largest and top performing funds fared in the quarter/year to the end of December 2017.
Using the Market iBoxx indices as a guide, the euro-denominated IG cash index returned 2.4% in 2017. However, the top performing funds delivered well in excess of that – usually helped by running a beta in excess of the index and having a decent high yield component in their portfolios.
The performance of the reasonably-sized funds has the Schroder ISF Euro Credit fund (AUM €1.8bn) returning 6.84% for the Conviction Fund in the year, while the larger ISF Euro Corp fund (AUM €8.9bn) came up with just over 5% in returns. In comparison, the €5.4bn MS INVF Euro fund returned 4% and the €3.5bn – sized Bluebay IG Fund came up with 4.22% in the year.
Top of the pile was the €457m assets under management in the Nordea 1 European Fincl Dbt fund with a 12.55% return, but mostly anything over 3% represented a good performance for this market last year.
>>See the full IG Euro Performance tables<<
European high yield had another fine year in 2017. The iBoxx index came up with 6.3% in total returns.
The fund data shows that the largest funds managed to just match the index with the likes of the Fidelity European HY A fund (6.25%, AUM €3.6bn) and the UBS Lux BF Euro fund (6.66%, AUM2.6bn) probably the pick of the bunch of the largest funds.
The smaller Deutsche Invest (6.15%, AUM €1.5bn) and Schroder ISF Euro HY fund (7.23%, €1.3bn) are worthy of a mention.
Of the midsized funds, Evli European HY fund (6.9%, AUM €834m) and the Pictet-Eur HY I fund (6.61%, AUM €777m) had a good year. The latter’s Short Term HY fund fared less well, on AUM of €3.4bn, the annual performance was just 1.72%.
>>See the full HY Euro Performance tables<<
In sterling, IG cash for the Market iBoxx index finally managed to close the year with 5% in total returns, and it seems like many of the largest funds got there too.
The £4.9bn Scottish Widows Corp bond fund fell short at 4.05%, but the IP Corp Bond fund (AUM £4.7bn) was up 5.7%, M&G’s Corp fund at 5.54% (AUM £4bn) with the smaller Royal London Sterling Credit Z fund some 7.51% (AUM £1.6bn). Rathbone’s £931m Ethical Bond R Acc fund was top of the pile, up over 10% for the year, with Kames’ IG A Acc up 6.94% (AUM £1.5bn).
In the sterling high yield market, the L&G High Income (AUM £1.4bn) delivered a good 9.8% and 6.3% in the 12 month and 3 month periods to the end of December, respectively, and is once again the notable out-performer in the high yield space.
>>See the full Sterling IG & Sterling HY Performance tables<<