The best performing global equity funds of the first quarter of 2019 have been revealed.
Data from FE Analytics shows the best performing fund in the IA Global sector since the start of 2019 was the £795m Baillie Gifford Global Discovery fund, which has returned 17 per cent in three months.
That performance was enough for the fund to beat the other 273 funds in the sector, the average of which has returned 8 per cent.
The largest sector exposures in the fund, which has been managed by Doug Brodie since 2011, are to healthcare and telecoms, themes which are prevalent in many Baillie Gifford funds.
A significant driver of performance in the first quarter of the year has been Ocado. The UK technology company and grocer’s shares have risen from £8.10 to more than £13 this year to date.
Meanwhile, the best performing global equity investment trust this year to date is Lindsell Train.
This is a £178m investment trust that trades at a 25 per cent premium to its net assets, but rarely issues new shares.
The largest investment in the trust is a stake in Lindsell Train Limited, a privately held asset management company that employs the fund managers of this trust.
Because the asset management business is not listed on any stock exchange, other funds cannot invest in it.
The trust’s manager Nick Train has said he does not want to issue more shares in the trust, and that both he and co-manager Mike Lindsell have promised not to buy or sell any of their personal holdings in the trust.
Paul Stocks, an adviser at Dobson and Hodge in Doncaster, said he found the trust’s structure complicated to explain to clients, and that it was an example of why he doesn’t tend to use investment trusts for clients.
The best performing global equity income open ended fund was the £410m Legg Mason Rare Global Infrastructure Income fund, which returned 13.6 per cent in three months, compared with 8.2 per cent for the average fund in the sector.
Infrastructure assets tend to perform well when the market is expecting interest rates to either fall or remain generally low.
The market ructions of December 2018 have led the market to expect interest rate rises in the developed world to be muted, while the inversion of the yield curve last week implied the market believes the next move in interest rates in many economies will be downwards.
This helps infrastructure assets because the income yield on those assets is viewed by the market as almost as safe as the income from a bond, and as low interest rates act to depress bond yields, the yield on infrastructure assets is seen as more attractive.
The best performing equity income investment trust this year to date is the £216m Securities Trust of Scotland.
This has returned 12 per cent in the first three months of the year, compared with 6 per cent for the average trust in the sector in the same time period.
The fund manager, Mark Whitehead, deploys the value style of investing, a style which has performed strongly this year.
The largest sector exposure is to telecoms, media and technology, though none of the group of US technology companies known as the FAANGs are among the top ten holdings.
The trust trades at a 7 per cent discount to net assets.
david.thorpe@ft.com
