Neil Woodford is the equity manager with the best track record of adding value consistently, according to research by Tilney Bestinvest.
The research looked at the track records of 497 fund managers across a range of equity sectors where at least five years of data was available.
Mr Woodford, manager of the CF Woodford Equity Income fund, outperformed his benchmark by 0.3 per cent on average both over his career and over the past five years.
He also spent 57 per cent of months over his career ahead of his benchmark.
In second place was Martin Cholwill, manager of the Royal London UK Equity Income fund, who delivered higher outperformance over the past five years, at 0.46 per cent, but lower over his career at 0.21 per cent.
Meanwhile Liontrust duo Anthony Cross and Julian Fosh, managers of Liontrust Special Situations, came third.
Over their career they managed 0.51 per cent average outperformance and 0.37 per cent over the past five years.
Jason Hollands, managing director of Tilney Bestinvest, said: “The differences in return between the best and worst performing actively managed funds is enormous and simply cannot be explained by variations in fund costs but rather are the result of the investment decisions made.
“If you are going to invest with actively managed funds it is therefore vital to select the right managers and to always reassess the case for continuing to hold a fund when the manager or team changes as they inevitably do in a highly competitive industry.
“The dilemma for investors is that fund performance data is typically provided for a period of just five years, which is barely an economic cycle and in any case such data may be of very limited relevance if it relates to the tenure of a manager who is no longer at the helm.
“We therefore believe it is vital to assess the relevant, full career track record of the current manager in a sector which may span multiple employers.”
|
| AVG MTHLY OUTPERFORMANCE | CONSISTENCY | EXPERIENCE |
| ||
MANAGER | SECTOR | FULL CAREER | 5 YEARS | % MTHS AHEAD | IN SECTOR | CURRENT FLAGSHIP FUND IN SECTOR | |
1 | Neil Woodford | UK EQUITY INCOME | 0.30% | 0.30% | 57% | 27.9 | CF Woodford Equity Income |
2 | Martin Cholwill | UK EQUITY INCOME | 0.21% | 0.46% | 58% | 19.4 | Royal London UK Equity Income |
3 | Anthony Cross / Julian Fosh | UK ALL COMPANIES | 0.51% | 0.37% | 65% | 8.3 | Liontrust Special Situations |
4 | Richard Pease | EUROPE EXCLUDING UK | 0.43% | 0.29% | 56% | 26.3 | Crux European Special Situations |
5 | Chris Hutchinson | UK ALL COMPANIES | 0.48% | 0.37% | 59% | 9.8 | Unicorn Outstanding British Companies |
6 | Giles Hargreave | UK SMALLER COMPANIES | 0.88% | 0.08% | 61% | 18.2 | Marlborough Special Situations |
7 | Mark Barnett | UK ALL COMPANIES | 0.30% | 0.37% | 58% | 13.7 | Invesco Perpetual High Income |
8 | Stuart Parks | ASIA PACIFIC INCLUDING JAPAN | 0.29% | 0.20% | 61% | 16.7 | Invesco Perpetual Asian |
9 | Daniel Nickols | UK SMALLER COMPANIES | 0.37% | 0.28% | 58% | 14.2 | Old Mutual UK Smaller Companies |
10 | Nick Train | UK ALL COMPANIES | 0.38% | 0.64% | 57% | 11.8 | CF Lindsell Train UK Equity |
Managers were scored on a number of factors, including their average monthly excess performance over their benchmark both over their full career and a five-year period.
They were also ranked on the percentage of individual months they delivered performance ahead of their benchmark during their career to measure consistency.
A final ranking was applied based on the length of a manager’s track record as the more data on the basis that more data made the conclusions more reliable.
Mr Hollands said: “While analysing a manager’s historic track record is important, choosing a fund based solely on past performance is as inadvisable as driving a car staring into the rear view mirror alone.