Absolute return fund

mrbrown

Im invested with Invesco Perpetual High Income fund. Its been fairly stable over the past year. Im expecting rocky times ahead and would like to use up my S&S ISA. Can anyone suggest an Absolute Return fund thats weathered the past few years well? Theres so many funds available, Im just looking for a few suggestions to begin my search.

I dont want to put more into my Invesco fund (Ild like to diversify a bit) and I dont really want to hold cash in my S&S ISA. Thats what Ive done with my 09/10 S&S ISA and have still yet to find a fund for that!

Thankyou

cogito

Do you have a particular reason for wanting to invest in an Absolute Return fund?

The investments lack transparency, their returns have been feeble and the only people who actually seem to gain from them are the fund managers who rake off hefty performance fees on the infrequent occasions that the investments increase in value.

Rather than being stable, the Invesco fund has actually gained over 13% in the past year. Only two of the dozens of Absolute return funds have bettered that in the same period and quite a few have actually managed to lose money. How could you be reasonably sure of picking a winner?

mike88

Newton Real Return has been a very stable performer with a long term manager. Check it out on Trustnet and you will see it has all the necessary industry accreditations. I bought £20k worth yesterday in the form of an ISA switch in order to lock in gains and to reduce volatility of my investment portfolio. I have also recently bought Artemis Strategic Assets but only £5100 worth as its a new fund with no proven track record but an excellent performer nonetheless.

I am also heavily invested in Invesco Perpetual High Income; in fact its my largest holding. It is a fund that is positioned defensively so I would not ditch it altogether

talexuser

I have a story very much like Mike88. Perp Hi inc has been held since pep 12+ years ago, the only fund never switched since buying, and the best long term return of all my UK income funds. I also have a punt on William Littlewood at Artemis since he made me pots of profit during the long time I was in Jupiter Income years ago. I was in Blackrock Absolute for a year or so, it made money but nothing special to live up to all the IFA hype and switched when it went flat. My 2 short list then were Mike88's Newton and the Stand Life Global Absolute Strategies which has had a good run recently, and I plumped for the SL. It's difficult to come up with alternatives since again Perp is near my largest holdings and you want to diversify.

The question now is when to switch out of absolute funds if so many large companies are cash rich, not borrowing, but maybe not investing because they might think they might not get a return for a few years if we go back to recession with all the cuts.

Mikeyorks

mrbrown wrote: »

Can anyone suggest an Absolute Return fund thats weathered the past few years well?

Most don't have that longevity. Of those that do - the Newton Real Return is about the only one that's truly fulfilled the promise of 'making a positive return no matter the market conditions'.

But I bought Artemis Strategic Assets shortly after launch as that is considered to be aligned with the 'absolute' philosophy. And (over 40% growth thus far) it's been a reliable performer since shortly after it's launch in May 09

http://www.h-l.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/a/artemis-strategic-assets-retail-accumulation

mrbrown

I'ld like an Absolute fund as I think we're in for some tough times ahead and am looking for some stability from my fund.

I like the look of the Newton fund. Its invested in much of the same stuff as Invesco.

Mikeyorks: Are Absolute Returns not meant for long term investments? What do you mean by "Most don't have that longevity."?

soulsaver

mrbrown wrote: »

I'ld like an Absolute fund as I think we're in for some tough times ahead and am looking for some stability from my fund.

I like the look of the Newton fund. Its invested in much of the same stuff as Invesco.

Mikeyorks: Are Absolute Returns not meant for long term investments? What do you mean by "Most don't have that longevity."?

Think he meant 'haven't been going that long...'

cardsharps

mrbrown wrote: »

I like the look of the Newton fund. Its invested in much of the same stuff as Invesco.

Exactly, they all invest in the same companies - Glaxo, Astrazeneca, BATS, Vodafone, BT, etc.
So here's a tip. Invest in these equities directly and avoid the fund managers' rip-off 1.5% management charge for doing the bleeding obvious.

mrbrown

Mikeyorks: Ive been looking at teh Artemis fund you mention and can see its grown 18.51% since launch - where are you seeing the 40% figure?

mrbrown

cogito: Which are the 2 Abosulte Funds that you mention have bettered Invesco (and is there an easy way to find that information out?). Do you suggest anything other than an Absolute Fund?
Thanks guys, useful comments here.

mike88

There's a good performance table of Absolute Return funds here:

http://citywire.co.uk/money/fund-and-fund-manager-performance/-/unit-trusts/absolute-return/fund-league-table.aspx?CitywireClassID=2166&RankModelID=9

You will need to change the time period in the right hand corner of the chart to 1 year to bring in the Artemis Fund.