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Chelsea’s RedZone highlights £35bn in underperforming funds

Darius-McDermott-700x450.jpg
Darius McDermott

Fidelity has topped the Chelsea RedZone of underperforming funds while the UK All Companies sector contributed the most underperforming funds.

This year the Chelsea RedZone has 151 funds, with total assets of £35bn, which posted third- or fourth-quartile returns in each of the past three years.

Eight  Fidelity Worldwide Investment funds, including the £689m Fidelity Multi Asset Strategic fund run by asset allocation director Trevor Greetham, feature in the RedZone.

The UK All Companies sector contributed 21 funds as well as half of the 10 in Chelsea’s DropZone of the worst performers over the past three years.

The worst performer was the £4.3m SF Webb Capital Smaller Companies Growth fund, which lost almost 60 per cent over the past three years and was 112 per cent down on the sector’s average return.

Chelsea Financial Services managing director Darius McDermott says: “This sector has performed extremely well in the past three years and the other funds in this area which have made it to the RedZone have actually returned 30 per cent to 50 per cent in the period.

“On the other hand, SF Webb Capital Smaller Companies Growth has managed to lose investors almost 60 per cent. That is shocking and, while the manager was changed in 2012, no turnaround has yet begun.”

Philip J Milton & Company managing director Philip Milton says: “I am very cynical about buying something based on performance. People should not be chasing past returns.”

The DropZone

Rank Fund % underperformance from sector average*

1st

SF Webb Capital Smaller Companies Growth

112.11%

2nd

Manek Growth

66.63%

3rd

SVM Global Opportunities

47.69%

4th

FP HEXAM Global Emerging Markets

29.81%

5th

CF Lacomp World

29.41%

6th

SWIP UK Opportunities

27.59%

7th

Ignis UK Focus

27.33%

8th

F&C UK Alpha

26.55%

9th

WDB Assetmaster Global Thematic

25.67%

10th

Marlborough UK Primary Opportunities

25.40%

*Based on three-year cumulative performance

Source: Chelsea Financial Services

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