Hargreaves Lansdown has culled four natural resources funds from its recommended list due to a change in its “quantitative analysis” process.
The discount broker has removed First State Global Resources, Artemis Global Energy, JPMorgan Natural Resources and the Junior Oils Trust from its Wealth 150 list of preferred funds.
The cull means there are now only two commodity-focused funds in the Wealth 150, BlackRock Gold & General and Smith & Williamson Global Gold & Resources.
Explaining the ejections, Hargreaves Lansdown said: “As our quantitative analysis of commodity-focused funds has become more sophisticated over time, we have found that, according to our research, few managers in these areas have the ability to consistently add value for investors.”
For the four funds that have been removed, Hargreaves said it had “lost conviction in the manager’s ability to add value for investors over the long term”.
The broker’s move comes after several years of negative performance for resources and energy funds, which have been hurt by plummeting commodity prices from the likes of gold, iron ore and oil.
A spokesperson for Artemis said the firm was “disappointed, naturally. But [managers] John [Dodd] and Richard [Hulf] are determined to regain lost ground. They hope in time to justify the fund’s return to the Wealth 150.”
First State, JPMorgan and Sector Investment Managers, which runs Junior Oils, were not able to provide comment in time for publication.
