Investment funds that focus on ethical and sustainable principles make a bold show in our 2020 awards.
Money Observer’s 2020 Fund Awards cover a choppy three-year performance period for global markets, culminating in the unprecedentedly rapid and deep crash of late February and the first three weeks of March. Only a small portion of the subsequent recovery in global equities and corporate bond markets is captured in the period to 31 March.
Despite the gut-wrenching falls, it was nevertheless possible to make extraordinarily good gains. Baillie Gifford Positive Change returned 66% over the three years under review, for example. It wins two awards: for the best large global growth fund and best equity-focused ethical/SRI (sustainable and responsible investment) fund.
This was not the only fund to double up: the winner and highly commended funds in the higher-risk mixed asset category, Royal London Sustainable World and Liontrust Sustainable Future Managed, also scooped the mixed asset gongs in the ethical/SRI category. Two similarly managed funds from these investment houses also won in the lower-risk mixed asset category.
A special hat-tip goes to Royal London Sustainable World, as this is the seventh consecutive year it has won the best ethical/SRI mixed asset award. Rathbone Ethical Bond is not far behind matching that: six consecutive years of being the best ethical/SRI bond fund. Both funds have regularly won awards in the standard mixed asset and sterling bond categories as well.
These funds encapsulate a growing trend in our annual awards, with more funds that prioritise ethical and SRI principles rising to the top. Outside of the ethical awards categories, nine ethical/SRI funds – a quarter of the total – have won 2020 awards. Several others also prioritise high environmental, social and governance (ESG) scores when selecting portfolio investments.
What this increasingly demonstrates is that investors do not need to sacrifice profits for principles. Meanwhile, a focus on sustainability from Royal London-managed funds has netted the firm five awards, closely followed by the four awards for Liontrust’s ‘Sustainable Future’ fund range. Aberdeen Standard Investments (ASI) and Baillie Gifford have also achieved four-timers from their fund stables.
All of the names on the 2020 Roll of Honour are prime examples of what we aim to showcase with our awards: funds that can generate consistently strong returns without taking excessive risks (the full methodology can be found here).
Fifteen of the 39 award-winning funds already have Money Observer Rated Fund status for 2020, and several of these have been rated for many years. Thirteen winners also appeared on the awards roster in 2019 and/or 2018.
With around 2,200 funds qualifying for awards consideration, this ability of previous winners to pass our stringent quality control checks and sustain comparatively decent returns is reassuring in difficult times.
We have every expectation that recipients of this year’s accolades can keep up their good work.
The 2020 roll of honour
UK Growth winners
Best Larger Fund:?Royal London Sustainable Leaders
UK Equity Income winners
Best Larger Fund:?Trojan Ethical Income
UK Smaller Companies winner
Global Growth winners
Best Larger Fund:?Baillie Gifford Positive Change
Global Equity Income winner
Global Emerging Markets winner
Best Fund:?Baillie Gifford Emerging Markets Leading Companies
Read more about the winner and highly commended fund here.
North America winner
Asia Pacific winner
Sterling Bonds winner
Global Bonds winner
Mixed Asset Higher Risk winner
Mixed Asset Lower Risk winner
Volatility/Absolute Return winner
Best Equity Fund:?Baillie Gifford Positive Change
Best Mixed Asset Fund:?Royal London Sustainable World
Notes: Profiles of the award-winners were written by Jennifer Hill. All performance data and risk ratios were supplied by Morningstar. See Fund Analysis in the July issue of Money Observer magazine for a review of 2019’s award-winning funds. Note: Investors cannot currently withdraw money or invest in the vast majority of open-ended UK commercial property funds, so we have suspended our awards coverage of this sector until their promoters can find a solution to the fundamental mismatch inherent in offering daily dealing in this illiquid asset class.
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.