The number of funds delivering consistent top quartile returns has surpassed the historic average, according research by BMO Global Asset Management.
The findings show the proportion of strategies achieving top quartile returns consistently over a three-year period has increased to 5% as of the second quarter this year, up from 3.9% the previous quarter. Nearly 1,100 funds were surveyed.
Put down to a rebound from the lows of the first few months of 2020, this is the highest level of funds to achieve such gains since the firm began the Fund Watch survey in 2008. It is also above the historic average of 2% and 4%, the report stated.
Kelly Prior, investment manager in BMO GAM’s multi-manager people team, said: “We have witnessed various market environments during this period, but nothing as unpredictable as to what investors are facing today.”
She added that it was pleasing to see active managers out there navigating the current challenges well and delivering value to investors.
In terms of sectors, IA North American had the highest number of funds delivering top quartile returns consistently with 12.6%.
With the exception of the IA UK Direct Property sector, all of the 12 main IA sectors rebounded from the dramatic falls of the first quarter and made positive ground.
Prior added: “To try to accurately predict how the second half of the year’s market moves would be a fool’s errand. The ‘new normal’ is still to be worked out, but there are a variety of factors which could shape the direction from here.
“Politics is going to be more important as the transition phase of Brexit and the US presidential election looms, as is economic fundamentals in determining the direction of markets.”
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