Aberdeen tops ‘dog’ fund table

Aberdeen Asset Management (AAM) has the highest number of funds listed in a league table of “dog” investments with consistently poor performance.

The latest bi-annual Spot the Dog report from Bestinvest has identified a total of £7.6 billion languishing in consistently poor performing investment funds.

The 34 equity funds open to retail investors have underperformed their market benchmark for the last three consecutive 12-month periods and by more than 5 per cent over the three-year period. AAM, which is currently in the process of a mega-merger with Standard Life, has five funds in the league table with a total of over £2bn of assets. The primary culprit being its £1.3bn Asia Pacific equity fund.

In second place is wealth group St James’s Place with its £1bn equity income fund the main contributor to its £1.7bn worth of funds in the table. Henderson was third in the table with £1.2bn of funds.

Jason Hollands, managing director at Bestinvest, said outside of the league table there were a “great many more pedestrian funds out there”.

He said they included closettrackers which largely follow the index but charge excessive fees for doing so.

“A real challenge for investors is that equity markets have delivered such strong returns in recent years, boosting the value of funds which have lagged the market, this has masked the lack of value added by some managers and will have left many investors unaware that they could be doing considerably better elsewhere,” said Hollands.

“It is therefore vital to periodically thoroughly review your investments to make sure you are in funds that can truly justify the fees charged.”