Scottish Widows Investment Partnership has topped the Bestinvest Summer ‘Spot the Dog’ report as the worst offender, with 10 funds on the list representing two-thirds of its assets under management.
Investor money held in dog funds across 10 key investment sectors jumped to £26.6bn from the £17.3bn recorded in the last report, published in February. The number of funds rose from 44 to 113 during the same period.
Scottish Widows/Swip was singled out as the worst offender in the list with just under £6bn held in dog funds. It was joined by Schroders, Fidelity, M&G and BlackRock in the top five.
Bestinvest senior investment adviser Adrian Lowcock says: “The amount investors pay to poorly performing managers has almost tripled as investors are paying £390m per year with dog fund managers taking home £1.17bn over the three years they have been underperforming.”
A Swip spokeswoman says that the firm is currently repositioning their £54bn equities business to focus on global and specialist active equities in addition to quantitative equities.
“This means that we are in the process of transitioning a number of our equities funds, including those in the survey, to the new equities strategy.”
Big funds that appeared on the list include the £812m Neptune European Opportunities run by Robert Burnett, £864m M&G Global Leaders and £1bn M&G American run by Aled Smith, £1bn Fidelity American run by Aris Vatis, £1.1bn Schroders UK Mid 250 run by Andy Brough, £450m Blackrock UK and £758m BlackRock UK Dynamic run by Mark Lyttleton.
City Asset Management research director James Calder says: “The big groups get caught out by the list as the worst offenders as they manage the most assets. SWIP tried to be all things to all people. Like most life companies, they are not good at investing money but it is addressing performance by culling under-performing funds.”
For more analysis and a full response from investment firms mentioned in the dog list go to www.moneymarketing.co.uk.