Best International Share Funds
Diversification into overseas sharemarkets has paid off for more adventurous investors
Most international share funds continued to provide stronger returns than local share funds over the past 12 months, so this is just one reason why investors seeking diversification need some exposure to overseas shares.
The outright winner of this category, Arrowstreet Global Equity, has been the joint winner for the past three years.
The fund is available both as a hedged and unhedged option and both have rated well. The fund is available through the Macquarie Professional Series.
It provides exposure to a diversified portfolio of global equities, which may include emerging markets as well as small caps.
The fund doesn’t invest in tobacco or “controversial weapons” securities.
Arrowstreet’s stock selection models are designed to understand what is likely to impact stock prices and it uses the information to forecast individual stock returns. It also aims to identify particular signals or segments of the market that exhibit the greatest mispricing.
“Arrowstreet Global Equity is an excellent quantitative investment strategy, driven by talented researchers and a proven systematic process,” says Morningstar analyst Elliot Lucas.
One blemish is its relatively high fee compared with peers, he says. “However, we think the quality of this investment offering far outweighs its cons, and believe the unique and sustainable methodology employed make it a sterling option for global equities exposure.”
Four funds have tied for second place:
Antipodes Global Fund – Class P has a high-conviction portfolio of 30 to 60 stocks, focusing on cyclical and structural factors, says Morningstar analyst Ross MacMillan.
The fund is a sound option because of a knowledgeable portfolio manager and detailed investment process, he says.
Antipodes Global Fund – Long Only P’s portfolio is focused on three major objectives: capital preservation, inclusion of attractively priced stocks and strong investment resilience, says MacMillan. “The fund has numerous solid characteristics, including an outstanding portfolio manager, well-considered investment process and structured portfolio construction methodology,” he explains.
IFP Global Franchise has a compact portfolio of 20 to 40stocks and both its hedged and unhedged option rated well with the research houses.
“One blemish is the fee. However, that aside, the experienced team and consistent application of a disciplined investment process make this an excellent global equities strategy,” says Morningstar analyst Michael Malseed.
Magellan Global Fund has been a joint winner for the past three years and it too is available as either a hedged and unhedged option, with both options rating well. The fund has a concentrated portfolio of 20 to 40 companies.
“Magellan’s high-conviction, risk-aware approach is one of the best in the market, and this strategy is an excellent option for Australian investors seeking exposure to international equities,” says Malseed.