Managed funds could do with a little Darwinism

Natural selection has worked wonders for Japan's overcrowded fund scene, says Merryn Somerset Webb. Just think what could be achieved elsewhere.

'Things that there are too many of'. It's a long list, but if you turn your thoughts to the financial industry, you will see that the standout is investment funds.

I have no idea how many funds there actually are available to chip away at your savings in the UK, but you can choose between over 2,000 at the top fund supermarkets alone. On that basis, I would guess at 7,000-10,000 in total.Most of those will be rubbish in one way or another, which of course is why the average active fund regularly underperforms any given index.

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Merryn Somerset Webb

Merryn Somerset Webb started her career in Tokyo at public broadcaster NHK before becoming a Japanese equity broker at what was then Warburgs. She went on to work at SBC and UBS without moving from her desk in Kamiyacho (it was the age of mergers).

After five years in Japan she returned to work in the UK at Paribas. This soon became BNP Paribas. Again, no desk move was required. On leaving the City, Merryn helped The Week magazine with its City pages before becoming the launch editor of MoneyWeek in 2000 and taking on columns first in the Sunday Times and then in 2009 in the Financial Times

Twenty years on, MoneyWeek is the best-selling financial magazine in the UK. Merryn was its Editor in Chief until 2022. She is now a senior columnist at Bloomberg and host of the Merryn Talks Money podcast -  but still writes for Moneyweek monthly. 

Merryn is also is a non executive director of two investment trusts – BlackRock Throgmorton, and the Murray Income Investment Trust.