US managers achieved the highest outperformance ratio in June

Active managers outperformed their indices in June. 66% of US managers, 55% of emerging market managers and 53% of Europe managers outperformed their benchmarks on a gross basis.

Small- and mid-caps performed quite differently across the different markets. In the US, small- and mid- caps strongly outperformed large caps in June, while in Europe and in the emerging markets no such effect could be observed. As many of the active funds have an overweight exposure in this market cap area, the outperformance of US managers can be explained by this factor. The overall sector allocation had a rather neutral effect. Sectors like financials and materials performed very well and the majority of the active managers lost in terms of relative performance by not having a significant exposure to these sectors. On the other side, sectors like telecom and energy performed poorly and active managers profited from their underweight stance.

Please find the full ifund research news for July 2017 with charts and a summary of manager meetings attached on the left.

Active managers delivered rather poor results in May

Active managers delivered rather poor results in May. Only 48% of Europe managers, 45% of emerging market managers and 43% of US managers outperformed their benchmarks on a net basis.

Small-caps strongly underperformed the market in May. As many of the active funds have an overweight exposure in this market cap area, the underperformance can be partly attached to this factor. In addition to that, the overall sector allocation also contributed negatively. Sectors like utilities and telecom performed very well and the majority of the active managers do not have a significant exposure to these sectors. Growth outperformed value and most managers in the universe have a growth rather than a value approach; the majority of the funds, however, was not able to profit significantly from this aspect.

Please find the full ifund research news for June 2017 with charts and a summary of manager meetings attached on the left.

Ideal environment for active managers in April

Active managers showed very good results in April. 85% of Europe managers, 59% of emerging market managers and 54% of US managers outperformed their benchmarks on a net basis.

Small- and mid-caps strongly outperformed the market in April. As most of the active funds have an overweight exposure in this market cap area, the outperformance can predominantly be attached to this factor. In addition to that, the overall sector allocation also contributed positively. Sectors like utilities, energy and telecom performed below average and the majority of the active managers does not have a significant exposure to these sectors. Last but not least, value underperformed growth and most managers in the universe have a growth rather than a value approach.

Please find the full ifund research news for May 2017 with charts and a summary of manager meetings attached on the left.

Focus on quality helped emerging market managers in March

Over a 12-month-rolling period, 29% of US managers and 56% of emerging markets managers outperformed their benchmarks net of fees. Only 10% of Europe managers could beat their benchmarks net of fees.

In March, 47% of Europe managers and 51% of US managers outperformed their benchmarks on a net basis. 70% of emerging market managers were ahead of their benchmarks.

The utilities sector performed strongly in March, but also financials, telecoms and consumer discretionary performed well. On the other hand, sectors like energy, healthcare and consumer staples did not perform well in March. However, the difference in performance was only small. Small- and mid-caps performed in line with the broad market. Overall, neither sector nor market cap allocation played an important role. The main reason for the outperformance of emerging market managers can be attributed to stock selection. In March, quality stocks with good fundamentals and strong balance sheets performed well.

Please find the full ifund research news for April 2017 with charts and a summary of manager meetings attached on the left.

Active managers behind benchmark in February

Over a 12-month-rolling period, 28% of US managers and 43% of emerging markets managers outperformed their benchmarks net of fees. Only 12% of Europe managers could beat their benchmarks net of fees. Over 12 months, the majority of funds had an underweight in materials, which was the best performing sector.

In February, only 28% of Europe managers and 26% of emerging markets managers outperformed their benchmarks on a net basis, at least 35% of US managers were ahead of their benchmarks.

Especially the health care sector performed strongly (pharma and biotech), but also technology, consumer staples and utilities performed well in February. On the other hand, sectors like energy, materials and telecom did not perform well in February. With respect to European managers, underweights in utilities and consumer staples detracted from performance, while underweights in energy and materials helped. Small- and mid- caps performed in line with the broad market. Overall, neither sector nor market cap allocation played an important role. The main reason for the underperformance can be attributed to stock selection. Regarding US managers, the underperformance of Mid-Caps hurt performance. Among emerging markets, the overweight in financials hurt (it is the only region with an overweight in financials).

Please find the full ifund research news with charts and a summary of manager meetings attached on the left.

Active managers outperform in January

Over a 12-month-rolling period, 45% of US managers and 45% of emerging markets managers outperformed their benchmarks net of fees. Only 18% of Europe managers could beat their benchmarks net of fees.

In January, the technology sector showed very good performance and many funds, especially in the US, have an overweight allocation in this sector. In addition to that, index heavy weights Facebook and Apple, which are overweighted in a number of funds, showed a strong performance in January. On the other side, sectors like telecom, energy and utilities did not perform well in January. As the majority of the funds are underweight in those sectors, the sector allocation had a significant positive effect. Moreover, and as a consequence of the sector performance, the growth style was clearly superior to the value style in January. As there are more funds in the peer-group with a growth tilt, this also contributed to the outperformance of active managers.

Please find the full ifund service news for Januar 2017 attached with charts and an overview of manager meetings attached on the left.

Active managers wrong-footed on sector allocation in 2016

In 2016, only 8% of Europe managers and 14% of US managers outperformed their benchmarks net of fees. 39% of emerging markets managers could beat their benchmarks net of fees. The main reason for the weak performance of active managers in Europe and the US was the sector allocation. Over the whole year, the majority of funds had an underweight in energy and materials and those two sectors showed the best performance. On the other side, the overweights in healthcare and consumer staples hurt as those sectors showed the weakest performance. In addition and related to that, the value style outperformed growth and the majority of manager apply a growth style. Last but not least, the majority of active managers had a small- and mid-cap-bias and this market-cap spectrum only performed in line with the market or even underperformed in Europe.

In December, sectors like telecom, energy, utilities and financials showed the best performance. As the majority of the funds are underweight in those sectors, the sector allocation had a significant negative effect. As a consequence, only 20% of US-managers and 22% of Europe managers could beat their benchmark. In the emerging markets, 48% of the managers outperformed net of fees.

Please find the full January 2017 edition of the ifund research news including charts and a summary of manager meetings attached on the left.

Active managers results in November are not affected by Trump’s win

Over a 12-month-rolling period, 35% of emerging markets managers and 26% of Europe managers outperformed their benchmarks net of fees. Only 17% of US managers could beat their benchmarks net of fees.

In November, small- and mid-cap as well as value- and growth stocks performed in line with the broader market. In addition to that, the energy and materials sectors outperformed while utilities underperformed. As the majority of the funds are underweight in financials/materials as well as in utilites and telecoms, the sector allocation had an overall neutral effect. As a consequence, 51% of US-managers could beat their benchmark net of fees. In Europe and the emerging markets, 45% of the managers outperformed net of fees.

Since the beginning of the year, the majority of managers in the US and Europe underperformed their benchmarks net of fees. The underweights in energy, materials and utility stocks have hurt as those sectors have recovered YTD.

Please find the full ifund research news for December 2016 with charts and a summary of manager meetings attached on the left.

Active managers faced strong headwinds in October

Over a 12-month-rolling period, we still experience good results for emerging markets and disappointing results for US managers gross of fees (see chart).

In October, financials and the value style outperformed the broader market while healthcare stocks achieved a weak performance. In addition to that, small caps underperformed the broader market. As the majority of the funds are underweight in financials/value and neutral or overweight in healthcare, the sector/style performance had an overall negative effect. The overweight of small caps in most portfolios also hurt performance. Nevertheless, due to the good stock picking of US-managers, 49% of US-managers could beat their benchmark net of fees. In Europe and emerging markets, only 36% and 29% of the managers outperformed net of fees, as the headwind was too strong.

Since the beginning of the year, the majority of managers in the US and Europe underperformed their benchmarks net of fees. The underweights in energy, materials and utilities stocks have hurt as those sectors have recovered YTD.

Please find the full ifund research news for November 2016 with charts and a summary of manager meetings attached on the left.

US and emerging market managers performed in line with expectations

Over a 12-month-rolling period we still experience good results for emerging markets and disappointing results for US managers (see chart). Europe managers performance was in line with the longer term average.

In July, the energy and utilities sectors strongly underperformed the broader market and the majority of the European funds are underweight in these two sectors. In addition to that, small- and mid-caps outperformed large caps in most regions. Net of fees 78% of US managers, 56% of Europe managers and 48% of emerging market managers outperformed their benchmarks.

Since the beginning of the year, the majority of managers in all the regions underperformed their benchmarks net of fees. The underweight of energy, materials and utilities stocks has hurt as those sectors have recovered strongly YTD.

Please find the full ifund research news with charts and a summary of manager meetings attached on the left.

Europe managers hit by the underweight stance on energy and materials

Over a 12-month-rolling period we still experience great results for Europe and a good performance for emerging markets managers while US managers deliver disappointing results (see chart).

In April however, Europe managers showed a weak performance. The energy and materials sectors strongly outperformed the broader market and the majority of funds is still underweighted in those two sectors. The outperformance of value versus growth did not help either, as most Europe managers follow a blend or growth style. Net of fees 29% of Europe managers, 59% of US managers and 61% of emerging market managers outperformed their benchmarks.

Since the beginning of the year, the majority of managers in all the sub-regions underperformed their benchmark net of fees. The underweight of energy and materials stocks hurt as those sectors recovered strongly YTD. The small cap universe, which is overweighted in the majority of portfolios, showed a weak performance in a challenging market.

Please find the full ifund research news with charts and an overview of manager meetings attached on the left.

Europe managers profit from small- and mid-cap bias

Over a 12-month-rolling period we still experience great results for Europe and a good performance for emerging markets managers while US managers deliver disappointing results (see chart).

In March however, only Europe managers showed a convincing performance. The small- and mid-cap-bias as well as the underweight in energy helped. Small- and mid-caps strongly outperformed the broader market in March as the performance of European energy stocks has been weak. Net of fees, 58% of Europe managers, 26% of US managers and 26% of emerging market managers outperformed their benchmarks.

Over three months, the majority of managers in all the sub-regions underperformed their benchmark net of fees. The underweight of energy stocks hurt as energy stocks recovered strongly in line with the oil price. The healthcare sector, which is overweighted in the majority of portfolios, showed a weak performance.

Please find the ifund reserach news for April 2016 with charts and summaries of manager meetings attached on the left.

ifund research news: February 2016

Europe managers showed a weak start in January. The small- and mid-cap-bias as well as the underweight in utilities and energy hurt performance. In a weak overall market, small- and mid-caps underperformed large caps and energy/utilities held up relatively well. Net of fees, 27% of Europe managers, 17% of US managers and 51% of emerging market managers outperformed their benchmarks.

Over three months, emerging market managers head the performance table followed by Europe managers as both of them profited from an underweight in commodity related sectors during November/December. US managers showed a less convincing performance as overweighted mid-caps underperformed the broader index in the US and stock picking in general has been weak.

ifund research news - October 2015

Europe managers showed the strongest performance as they continue to benefit from the underweight in commodity related sectors. In addition to that, the small- and mid-cap-bias of the overall peer-group helped again in September. Emerging markets managers showed good results in September. They also profited from the underweight in weak performing sectors such as energy and materials. US-managers achieved weaker results due to the overweight in weak performing US small- and mid-caps. Net of fees, 74% of Europe managers, 55% of emerging market managers and only 19% of US managers outperformed their benchmark.

Over three months, Europe and emerging market managers head the performance table for the already mentioned reasons with net 67% and 66% outperforming. US managers showed a less convincing performance with 28% net outperforming.

Please find the full report attached on the left.

ifund research news September 2015

Emerging markets managers showed strong results in August. As already in July, they profited from the underweight position in weak performing China as well as in commodity related sectors such as energy and materials. The performance of Europe managers was even stronger as they also benefited from the underweight in commodity related sectors. In addition to that, the small- and mid-cap-bias of the overall peer- group helped. Net of fees, 82% of Europe managers, 58% of emerging market managers and 49% of US managers outperformed their benchmark.

Over three months, emerging market managers head the performance table for the already mentioned reasons with net 68% and gross 71% outperforming. Europe managers also achieved good results with 62% net and 74% gross outperforming. US managers showed an average performance with 49% net and 58% gross outperforming.

Please find the full report with insights from manager meetings attached on the left. 

Strong performance of US and Europe

ifund outperformance index: this index series which has been launched by ifund shows what percentage of managers has exceeded its benchmark over a rolling 12-month period. The monthly updated index series helps investors in their decision of choosing active versus passive products.

Manager-Meetings: a summary of insights from our most relevant meetings with fund managers.

Please take a look at the PDF with detailled informations you find in the left menu.

Folgen des SNB Entscheids – Wo kann der Anleger in CHF jetzt noch positive Erträge erzielen?

Nach der SNB Entscheidung, dem Druck zu einer Aufwertung des Schweizer Franken nachzugegeben und die Wertuntergrenze aufzuheben, ist die Rendite der zehnjährigen Eidgenossen nun praktisch null. Auch EUR-Aggregate Anleihenfonds weisen lediglich noch eine Rendite von etwa 0,7% auf. Nach Abzug der Absicherungskosten (EUR versus CHF) von derzeit etwa 0,8% pro Jahr resultiert bereits vor Gebühren eine negative Rendite. Positive Erträge in CHF (nach Absicherungskosten) zu erwirtschaften ist noch schwieriger geworden. Lediglich mit der Übernahme höherer Risiken kann dieses Ziel noch erreicht werden.

In Dokument im Anhang links stellt ifund Analgen mit höherer erwarteter Rendite, aber auch mit erhöhten Risiken bezüglich Kreditqualität, Liquidität und Marktschwankungen vor.

Von
Thomas Züttel
Head International Fund Research
ifund services AG