Fund performance comparison (after fees?)

barginboyrob

Hello,

I was wondering how I would check the highest performing funds over the last 6 months,1 year, 2 years after fees have been taken in to account?

Rob

dunstonh

Trustnet or morningstar are the main free resources

bowlhead99

Go to trustnet.com and pick the sector you are interested in. Or leave it blank and get a jumbled mess of all different types of funds which are not designed to compete with each other.

Either way, the fund performance is always net of all costs and fees borne by the fund. It won't include the cost to you of any "initial charge" or "dilution levy" paid to the fund, and obviously can't include or the cost of any platform fees which will depend who you decide to buy the fund from after you have shopped around between providers.

stringer_bell

sorry to hijack another thread, what is considered a decent fee for a fund?

for example, I use II and on axa biotech ongoing charges are 1.88%, however there is a rebate of 0.88%. decent?

Linton

stringer_bell wrote: »

sorry to hijack another thread, what is considered a decent fee for a fund?

for example, I use II and on axa biotech ongoing charges are 1.88%, however there is a rebate of 0.88%. decent?

So you invest in Axa biotech class R at a charge of 1.88% with an ii discount of 0.88% and would have received a return of 212% if you had been investing for the past 3 years. You can now invest in the Z class with a charge of 0.83%

If you wanted even lower charges you could have invested in say Vanguard LS 100% with charges of 0.24% and a 3 year return of 47%.

bowlhead99

Paying 1% net fee and still being left with almost 250% growth over 3 years seems worth it, although it depends what other similar funds charge for the same performance in the same time period.

Whether you would consider 1% net fee "fair"if you were losing 40% a year, is a different matter, that's normally when people start complaining. Of course if you want the manager to show up to work and make sure you only lose 40% a year instead of 50% a year, you need to keep paying him.

Kendall80

Consider the yield in this equation too. I like active funds that 'more than' pay for themselves

bowlhead99

Kendall80 wrote: »

Consider the yield in this equation too. I like active funds that 'more than' pay for themselves

As a counterpoint, for much of my portfolio I don't have a preference for income, as one can create a notional yield by simply withdrawing the capital growth whenever one needs cash. Total long term return is the important performance metric unless you have a specific strategic need for dividend payers.

Otherwise it penalises low yield high growth stocks which might never get bought if you have a rule that the divi must pay all fees.

Also, no real comfort in saying 'at least the management was free because it paid for itself' when the fee is 0.8%, the yield 1%, and the total return is negative. Basically if the fees are high both your gross yield and your gross capital return generated are paying for them, and the allocation to one bucket or the other is arbitrary.

guymo

Kendall80 wrote: »

Consider the yield in this equation too. I like active funds that 'more than' pay for themselves

Why single out the dividend yield? I'm prepared to be told that I've missed something here, but... Surely yield is just a component of the total return, in the same way that the fund charges are a (negative) component of the total return.

Dividend yield becomes a concern if you are explicitly interested in generating a cash income from your holdings, but simply comparing the management fees to the yield strikes me as unhelpful mental accountancy.

colinjd

I'm also sorry to hijack the thread but I too have been using Trustnet recently to help analyse my portfolio and have a question regarding how to account for sales.

It's easy enough to enter new figures when you make a purchase but how do you administer a sale of only a part of your holding - not all of it?

Thanks

bowlhead99

Trustnet is pretty good for running performance charts across lots of funds and timescales and doing comparisons. What it's not so good at is maintaining a virtual portfolio, and it doesn't have a facility to turn sales into cash or do partial sales leaving residual values.

What you can do of course if you had originally booked a purchase of 1000 units at £2, and then the fund grew to be worth £5 each or £5000 total, and then you sold £1500-worth... is simply edit your original purchase. What you're left with in the portfolio is 700 units at £5. So just edit your original transaction to say you only bought 700 units at £2 back in the old days, and the virtual portfolio will now be tracking the 700 units and saying they're worth £5 each.

This means your current portfolio will have the right contents and be fairly valued. However, you have 'lost' some of your history because a graph of your portfolio shows the rise of that fund from £1400 to £3500, and it doesn't know you had originally ALSO got an _extra_ £600-worth of that fund which grew to £1500 before being exited.