Only two of 26 funds offered by St James’s Place have outperformed their benchmarks over both one year and five years, and since their inception, a new analysis shows.
Data compiled on behalf of Money Marketing by Square Mile on 26 unit trusts offered by SJP shows that 29 per cent of funds have out-performed over the past five years and nearly 40 per cent have out-performed their benchmark since inception.
Ten of the 26 funds have underperformed when looking across one year and five years, and since inception, however.
Of the 36 funds currently offered by SJP, Square Mile said it could assess only 26 because the funds’ reports often displayed more than one representative index, making it harder to compare them.
SJP claims performance comparisons should not be made on single funds but on SJP-recommended portfolios, which its clients usually buy. It says the most appropriate benchmark is the Asset Risk Consultants Portfolio Index, which collates risk-rated portfolio returns from 60 investment managers.
An SJP spokesman says: “SJP funds are monitored against the unique investment objective for each fund, and are presented net of all associated costs — i.e. all advice costs, platform or administrative charges, product tax wrappers and external fund manager fees. Therefore, a comparison with an index in this way is misleading.”
Eight SJP portfolios’ relative performance figures provided by the firm show that two have under-performed the ARC index over three years and one has underperformed since launch.
Architas investment director Adrian Lowcock says: “Effectively, [SJP] is saying it has bundled all its costs into the fund, which means the client has no idea what they are actually paying.
“[It is] not really in the spirit of RDR because investors cannot do a genuine comparison. While performance isn’t good, SJP is clear on the fact performance is after costs, which fundamentally is most important.
“It is perfectly reasonable to assess both its asset allocation and fund selection skills. If it doesn’t value the latter, using trackers would be the best approach.”
According to SJP reports in March, costs for the funds, which are close to 2 per cent in most cases, include advice, platform and administrative charges. The reports state performance is calculated after cost.