Big and small funds shine at Morningstar awards

MANAGING RISK: INDEX TRACKERS EARN THEIR STRIPES

Morningstar’s awards this week showed managing risk is something smaller funds can do just as well.

than just recognising the top performers, it gives awards to those funds that have delivered the best risk-adjusted performance over one, three and five year periods. Morningstar says that when measuring risk it penalises downside variation more than upside volatility. This, it believes, identifies the funds that add the most value for investors. Runner-up: PSG Equity Fund

Best cautious allocation fund: Bridge Stable Growth Fund Runner-up: SIM Inflation Plus Fund

Best moderate allocation fund:

Nedgroup Investments Opportunity Fund

Runner-up: NFB Ci Balanced FoF

Best aggressive allocation fund: PSG Balanced Fund Runner-up: Allan Gray Balanced Fund

Best flexible allocation fund: Centaur BCI Flexible Fund Runner-up: Nedgroup Investments Bravata Worldwide Flexible Fund

Morningstar only gives a limited number of awards and so does not use the local unit trust categories, but rather the categories it employs globally.

This means that in the asset allocation categories, local and global funds compete directly. It is notable that across these categories, the Nedgroup Investments Bravata Worldwide Flexible Fund was the only short-listed portfolio that is not domestic.

It is also telling that the winner of the best global fund category is an index tracker.

The iShares Core MSCI World USD Fund, managed by BlackRock, offers passive exposure to a global index. This demonstrates how difficult it can be for active managers to add value in this space.

Best fund house – larger fund range: ersPrudential Investment Manag

Runners-up: Nedgroup Investments/PSG Asset Management