InvestmentsAug 26 2016

Woodford beaten by UK’s top performing fund manager

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Woodford beaten by UK’s top performing fund manager

Slater Investments’ Mark Slater has been named Britain’s top performing fund manager, beating back competition from better known rival Neil Woodford.

The MFM Slater Growth fund returned on average 12.2 per cent per annum over a 10 year period, according to TD Direct Investing’s annual top 25 Best of British Fund Managers list.

The fund outperformed the benchmark by 7.1 percentage points, making it by far the most successful equity fund on the list, judged purely on outperformance.

The next best performing fund was Michael Lindsell and Nick Train’s CF Lindsell Train UK Equity fund, which beat the benchmark by 6.3 per cent. No other fund outperformed by more than 4.4 per cent.

Neil Woodford came in at fifth place, with his CF Woodford Equity Income fund returning 9 per cent, and outperforming the benchmark by 3.8 per cent. This was an improvement on last year, when he came in ninth position.

The 25th top-performing fund - Richard Newbery and Alistair White’s Aberforth UK Small Companies - outperformed the benchmark by just 0.1 per cent.

Despite the fact that the bottom nine names on the list only beat the benchmark by 1 per cent or less, TD Direct Investing presented the results as “proof that active management is very much alive in the UK and that Britain remains a good place to invest despite the recent Brexit shock”.

“This list of the top 25 Best of British Fund Managers should give a welcome boost to UK investors,” the firm’s chief investment officer Michelle McGrade said.

“It highlights that there is a wide array of investment talent in Britain, with managers successfully navigating through economic cycles by investing in UK companies that outperform over the long term.

He said the list should “help those feeling less confident about where to put their money”.

“These managers are dedicated to delivering returns for their investors and are passionate about achieving long term outperformance – showing active management continues to have an essential role to play,” he said.

Top ten of TD Direct Investing’s annual top 25 Best of British Fund Managers

RankManagerFundMorningstar ratingAnnualised return (%)Sector out-performance (%)Category
1Mark SlaterMFM Slater GrowthBronze12.27.1Mid/Small
2Michael Lindsell & Nick TrainCF Lindsell Train UK EquityGold11.56.3Core
3Anthony Cross & Julian FoshLiontrust UK Smaller CompaniesBronze11.74.4Mid/Small
4Francis BrookeTroy Trojan IncomeSilver9.34Income
5Neil WoodfordCF Woodford Equity IncomeBronze93.8Income
6John WoodJOHCM UK Opportunit-iesSilver8.63.7Core
7Mark BarnettIP UK Strategic IncomeBronze8.63.7Income
8Harry NimmoSLI UK Smaller CompaniesSilver10.93.6Mid/Small
9Daniel NickollsOld Mutual Smaller CompaniesGold10.53.2Mid/Small
10James de Uphaugh & Chris FieldMajedie UK EquityBronze8.43.2Core

Adviser view

Dennis Hall, chief executive of London-based Yellowtail Financial Planning, said: “I am not saying there are no people who outperform but people who do, don’t do it consistently and it is incredibly difficult to find out who will outperform going forward.

“I effectively buy a bunch of trackers with a tilt towards special situations, value and small caps and once we have got that secured, if the client wants someone who is a conviction manager we might find one.”