Specialist funds: a reliable alarm signal
Research into the performance of 1500 funds has revealed that only 14 made positive returns in May. And there are two important lessons to be learned from this.
After examining the performance of more than 1,500 funds, research from Trustnet.com has revealed that between 11 May and 6 June, only 14 funds, essentially bond funds, made positive returns. The ten worst-performing funds fell by more than 15%, but their one-year performance record to 6 June tells a different story. They are all up more than 30%.
According to Brian Dennehy of financial adviser Dennehy Weller & Company, there are two lessons to be learnt from this. The first is to drip cash into emerging market funds monthly, as timing is everything when it comes to this volatile sector.
The second, he tells The Mail on Sunday, is that when investment houses begin launching specialist funds, alarm bells should start ringing. "It's usually a signal that the boat has been missed," he says. Allianz Global Investors and Threadneedle launched emerging market funds earlier this year, RCM Bric Stars and Global Emerging Markets respectively. The former is down 5% since launch, and the latter more than 10%.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
![https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg](https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748-320-80.jpg)
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
-
Revolut finally bags a UK banking licence – what next for the fintech?
Revolut has finally been granted a UK banking licence following three years of negotiations with the regulator
By Kalpana Fitzpatrick Published
-
Could Labour impose a “double death tax” of more than 50%?
Speculation is mounting that capital gains tax will be reformed in the Budget - and one option is to charge bereaved families the tax on top of inheritance tax. We explain how it could work
By Ruth Emery Published