Woodford helps SF Positive fund storm ahead of sector

Woodford helps SF Positive fund storm ahead of sector

Fortunes turned for the SF Positive fund in August last year when the investment vehicle began outpacing its peer group.

The £27.9m fund has been gaining ground over the past three months, returning 4.7 per cent against 4.3 per cent for the IA Mixed Investment 40-85 per cent sector, FE figures have revealed.

Despite lagging behind the sector between August 2013 and August 2015, over a three-year period the fund has returned 17.1 per cent against the sector average of 12.2 per cent.

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More than a fifth of the portfolio is invested in popular funds, including the Woodford Equity Income fund, which is the star holding, and the Legg Mason Investments Japan Equity fund.

A third of the portfolio is exposed to UK equities, and the remaining allocation spans across developed markets, including Japan, Europe and the US.

According to the latest fund factsheet, the fund aims to distribute yearly income of 2 per cent, as well as capital growth.

Ranked 20th in the sector, fund managers Andy Parsons and Sheridan Admans have 15 per cent invested in money markets, another 15 per cent in the healthcare sector, and 13 per cent in financials.

The minimum investment is £25 and the ongoing charge is 0.75 per cent.

Tavistock’s Acumen Progressive Portfolio, launched in September 2014, has dropped 3.7 per cent since May last year, falling more sharply than the 3.4 per cent slide for the sector.

Its top five holdings invest in the iShares tracker strategies, with S&P 500 GBP Hedged topping the list at 11.5 per cent, FTSE 100 Acc at 11.4 per cent, and the FTSE 250 at 11.3 per cent.

Exposure to the UK market makes up 39 per cent of the portfolio, the US makes up 31 per cent and Europe comprises 6.8 per cent.

The minimum investment is £1,000 and the ongoing charge is 1.3 per cent.

SF PositiveTavistock Acumen Progressive
1. Woodford Equity Income 10.9%1. iShares S&P 500 GBP Hedged 11.5%
2. Legg Mason Investments Japan Equity 10.7%2. iShares FTSE 100 Acc 11.4%
3. Schroder Unit Trust European 9.4%3. iShares FTSE 250 11.3%
4. Invesco Perpetual UK Strategic Income 8.5%4. iShares Developed Markets Property 8.8%
5. Royal London UK Mid-Cap Growth 8%5. iShares Core £ Corporate Bond 6.6%

Adviser view:

Ben Yearsley, investment director at the Wealth Club, said: “These are two very different multi manager products except for their size, with both at about £27m.

“SF Positive invests in actively managed funds, whereas Acumen only invests in exchange-traded funds (ETFs), which helps keep the operating cash flow down on the latter.

“SF has a range of fairly plain vanilla well-known names currently in the portfolio, the likes of Neil Woodford for example, and also Legg Mason Japan – one of the stellar performers of 2016.

“However, the long-term record, despite having a raft of quality names, is fairly lacklustre.

“There have been sustained periods of outperformance versus the sector. But over the life of the fund not much real value has been added – only 3.3 per cent outperformance overall.

“Asset allocation rather than stock selection drives long-term outperformance of the Acumen fund range. Since its launch in 2014 there has been marginal outperformance of the sector, but this needs to be tested over the longer term to see if the managers have an edge.