Identifying good Funds.

MarkBargain

Looking on Charles Stanley Direct, Vanguard Global Small-Cap Index Fund GBP Acc has increased in value just over 70% in the last five years.

Just to compare to how mine have done over the same period to give a little idea...

CIS Sustainable Leaders C Trust Acc up just over 80%.
Jupiter Ecology I Fund Acc up around 46%.
Legal & General Ethical I Trust Acc up just over 80%.

TheTracker

Zippeh wrote: »

I'm new to this investing lark, and I was wondering how to spot a "good" fund. I understand that fees come into it, but what else do people look for? I'm sure things like diversification of investments comes into it, but if you decide on a sector, how do you then decide which fund in that sector to go for?

I generally invest in whatever fund or strategy Ryan Futuristics is pumping this week. The problem is the trading fees are killing me and I keep having to sell the previous week's recommendation.

jimjames

TheTracker wrote: »

I generally invest in whatever fund or strategy Ryan Futuristics is pumping this week. The problem is the trading fees are killing me and I keep having to sell the previous week's recommendation.

Or just keep 70% cash?

Zippeh wrote: »

Looking at the vanguard global small cap as an example and it says that it has a historic yield of 1.2%. That seems poor to me. Am i misunderstanding the figure?

It depends what you're understanding by it. That's the girls, how much dividends the fund pays out. It's not how much the fund has grown by.

Ryan_Futuristics

I don't normally take pleasure in other's misfortune - but when developed equities and global bonds tank, and your LifeStrategy funds start their short journey into my and Mr Woodford's Christmas bonuses, I'll toast your tragic conviction with a nice tall Belvedere (and maybe a cigar I'll light with a £500 note)

Personally, with the exception of one or two fund managers, I assess funds as if they were shares - so I basically consider the value of what I'm buying above whether it's active, passive, smart-beta, etc

This means I'm often buying out of favour funds rather than formerly successful ones (if I buy a popular fund, I have a hedging rule) ... So I use MorningStar to look at the fundamentals ... My basic rule is that the Projected Growth plus Dividend is higher than the P/E ratio plus fund charge ... Sort of the fund version of a PEG ratio ... Among the highest scores in 2014 were Argonaut European Alpha, Kotak Indian Mid-Cap, New Capital China ... If you'd bought them 6 months ago, I think you'd be about 30-40% up (with Kotak in particular almost 100% up)

PS -

That's why I pay a little extra for a platform with frictionless trading charges ... I might spend this year's dividends on completing my luxury onesies collection - just hope it's not your pension funds I'm buying them with

TheTracker

Ryan_Futuristics wrote: »

This means I'm often buying out of favour funds rather than formerly successful ones (if I buy a popular fund, I have a hedging rule) ... So I use MorningStar to look at the fundamentals ... My basic rule is that the Projected Growth plus Dividend is higher than the P/E ratio plus fund charge ... Sort of the fund version of a PEG ratio ... Among the highest scores in 2014 were Argonaut European Alpha, Kotak Indian Mid-Cap, New Capital China ... If you'd bought them 6 months ago, I think you'd be about 30-40% up (with Kotak in particular almost 100% up)

Then it's funny that in your 700 posts of vacillating prognostications

• Argonaut European Alpha. You first mentioned this in 2015, not 2014, saying you were "tempted" by it which I assume means you didn't hold it as of 6 weeks ago. Two weeks ago you "like" it which true to form gives no indication that you'd put your money where your mouth is.
• Kotak Indian Mid Cap. We've been here before. You declared a holding in 2015 not 2014. In fact just before Christmas 2014 you said you didn't hold India.
• New Capital China. You've simply never mentioned this before.

In fact you said you picked mostly defensive funds in 2014 which makes it doubtful much of your investment went against these. In fact you've said you are more than 50% in cash.

So rather than tell us what your screens show performed well in 2014, what 3 relatively non-mainstream funds would you invest in today for 2015? I'll check back at xmas. If no response we will go with the three above, which in 2015 the YTD returns appear to be 5%, 4%, and 0% respectively.

Ryan_Futuristics

Calm down and read slowly: "If you'd bought them 6 months ago, I think you'd be ..."

You could put that sentence in the Oxford dictionary under examples of "hypothetical" ... I'm going to have to start forwarding your posts to Doug Naylor - you write the Arnold Rimmer character better than he does - bullet points, pettiness and everything

The only funds I recall telling everyone I bought in 2014 were Woodford Equity Income (up 16%), Neptune Euro Ops (up 10%), JPM New Europe on the dip (up 10%) and First State Asia Pacific Leaders (up 12%) ... I also said this year would be all about Europe and Emerging Asia

Rollinghome

Ryan_Futuristics wrote: »

Calm down and read slowly: "If you'd bought them 6 months ago, I think you'd be ..."

Ah yes, if only... Don't Trustnet realise that if only they would tell us which funds they were going to put at the top of their performance charts six months earlier we could all be rich?

Borrowedtune

I use a cheap tracker for the US and actives for the other markets I am interested in, such as Asia and Small Caps.


I look for a fund with a good track record of beating the relevant index on an annualised basis over 5 years or longer e.g. Threadneedle Europe Select, F&C MidCap.


I avoid funds with a bid/offer spread and fees that appear excessive.


I personally avoid thematic funds like technology, natural resources. I also avoid Japan.

Ryan_Futuristics

Rollinghome wrote: »

Ah yes, if only... Don't Trustnet realise that if only they would tell us which funds they were going to put at the top of their performance charts six months earlier we could all be rich?

Well that's why you follow a system ... If you were going to buy the best value funds on PEG ratio every year, you'd have bought them

Or you'd buy them this year ... Value isn't a short-term timing strategy; these figures relate to what you can expect for the next 5-15 years

jimjames

Ryan_Futuristics wrote: »

Well that's why you follow a system ... If you were going to buy the best value funds on PEG ratio every year, you'd have bought them

Or you'd buy them this year ... Value isn't a short-term timing strategy; these figures relate to what you can expect for the next 5-15 years

I agree that avoiding chasing the best performing fund from previous year can be a good strategy. It can also be a drag on portfolio when a fund like a US tracker continues to do well regardless of value measures.

It's much more comforting for me to be investing in a fund that is off it's peak that one that is constantly reaching new highs.