The report - a six-monthly study which names and shames the worst performing equity funds - has identified 77 funds which meet the dog fund criteria, down from the 119 funds identified six months ago.
According to the report, funds benefitted from a “significant rotation” in markets since the announcement of a successful Covid-10 vaccine, while fund groups are also upping their game following the introduction of annual value assessments.
The fund groups in the doghouse include HBOS, Invesco, St James’s Place, Scottish Widows and Abrdn.
HBOS tops the list, with £6.85bn across five funds ranked as poorly performing, which are all advised by Schroders.
The funds include the Halifax UK Growth, UK Equity Income, North American, European and Far Eastern.
A spokesperson for HBOS and Scottish Widows said: “These equity funds (often described as quant or multi-factor equity) are designed to bring benefits to investors over the long term, and therefore recent market performance should not be the sole basis to determine the overall performance of this style of investment.
“We believe the long-term outlook means this investment style is still appropriate for our customers’ investments.”
Invesco is second on the list, with three funds worth £5bn listed as underperforming.
However, the report noted the firm seems to be “reaping the benefits” of a new chief investment officer after appearing in the top spot in the hall of shame in the past six Spot the Dog reports.
The three Invesco funds appearing in this year’s report (US Equity, UK Equity High Income, and Income) are in comparison to the eleven funds appearing six months ago.
In December, Invesco’s new chief investment officer said she was “really pleased” with the progress made by the fund since former-star fund manager Mark Barnett left the company earlier that year.
Stephanie Butcher told FTAdviser Invesco had made “a lot of changes” since Mr Barnett’s exit in May in a bid to ensure the firm had the “right mix” on the investment floor.
A spokesperson for Invesco added there has been nearly a 50 per cent turnover in holdings within the UK Equity High Income and Income portfolios.
She added: “This type of restructuring is not done in haste and has been undertaken with care to ensure any buying or selling is done at the best time, in line with our investment disciplines to achieve the best outcome for investors. Performance has improved under the new joint managers and is a foundation that they can build from – and improve on – in years to come.”
