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Autif charts equity outperformance

Autif is encouraging investors to persevere with equity investment despite the recent hammering in stockmarket values.

It says despite a 12 per cent fall in the UK stockmarket over the past three months, 10-year returns from equity and corporate bond funds have convincingly beaten bank and building society savings accounts.

Its latest quarterly chartpack shows that every Autif sector except global emerging markets and Japan have beaten building society returns over 10 years while, over 15 years, all sectors but the Far East, Japan and Japanese smaller companies have come out on top.

Over the 10 years to October 1, the average annual income on £1,000 invested in an equity income fund rose from £44 to £64 while the interest received on the same amount invested in a building society dropped from £63 to £22.

However, over 10 and 15 years, the FTSE All Share index has beaten almost all the Autif sector average returns, making a stronger case for passive management in the longer term.

Over 15 years, only the Europe including UK sector has outperformed the FTSE All Share.

The best-performing sector over 10 years was North American smaller companies, which turned a £1,000 investment into £3,548. The worst performer, Japan, turned £1,000 into £922.

Bates Investment senior investment adviser Paul Illot says these figures do not discourage him from active funds. He says: “We are aiming to outperform the indices for our clients and we are not going to be able to do that with trackers.

“There are also going to be a number of funds that will have outperformed the index over the long term, even though the average is less than the index.”


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Gerrard – Millennium Global Portfolio Service

Wednesday, November 7, 2001.Aim: Income or growth by investing in UK unit trusts, Oeics and investment trusts.Minimum investment: £30,000.Investment split: 100 per cent in UK unit trusts, Oeics and investment trusts.Income facility: Monthly.Charges: Initial up to 3 per cent, annual 1.25 per cent.Commission: Initial up to 3 per cent, renewal 0.5 per cent.Tel: 0845 0700122.

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