The top funds to invest in
As market volatility and recessionary fears continue, here are the most popular funds, stocks and trusts investors are putting their money into
Every month, we look at what investors are paying into and in the month of February, passive funds continued to be the most popular pick and they have been in the last few months.
Investors are pumping more money into passive funds as they shy away from all but Fundsmith Equity when it comes to stashing cash into active funds.
Terry Smith’s Fundsmith Equity still remains a top buy as it was throughout most of last year, followed by a number of Vanguard’s life strategy funds, which have consistently been a a favourite.
And when it comes to stocks, banking giant Lloyds has jumped up but Tesla fans are also continuing to buy into the stock to take advantage of a bargain.
We look at the most purchased funds, stocks and investment trusts by investors in February.
The most popular funds for investors
According to fund supermarket interactive investor, these are the 10 most popular funds bought on its platform in February 2022.
- Fundsmith Equity
- Vanguard Lifestrategy 80% equity
- Vanguard Lifestrategy 100% equity
- Vanguard US Equity Index
- Vanguard Lifestrategy 60% equity
- Vanguard FTSE Global All Cap Index
- Vanguard Developed World Ex UK Equity
- HSBC FTSE All World Index
- Fidelity Index UK
- Fidelity Index World
Dubbed the ‘poster-child’ for active management, Terry Smith’s Fundsmith Equity tops the funds chart. Vanguard funds maintained the same popularity in February as they did in December and January among DIY investors.
Fundsmith Equity was also the most popular open-ended fund pick for the entirety of last year on the ii platform.
The 10 most popular stocks purchased by investors
These were the most popular stocks bought on the platform in February 2023.
- Lloyds Banking Group
- Vast Resources
- Natwest Group
- Legal & General
- Rolls Royce
Banks are back, with investors going big on them in February in hope that they will do well from rising interest rates. See our article on where interest rates will go up for more on where interest rates are heading.
FTSE heavyweight Lloyds was the most popular, but Barclays and Natwest have also entered the mix as the most popular equities.
“Dividend yields of over 4% for Lloyds, Barclays, and NatWest continued to leave the sector under the spotlight. Poorly received annual results from both Barclays and NatWest, pushing their shares 6% and 5% lower respectively during February offered investors potential buying opportunities,” Keith Bowman, investment analyst at interactive investor said.
Tesla fell off from the top spot it had in January, but it is still at third as investors keep a keen eye on bargains.
“Momentum in shares of electric vehicle maker Tesla carried on through to February following a highly buoyant January. Record early year order demand following announced vehicle price cuts in December helped set the ball rolling, pushing its shares up 40% in January and 19% in February. That follows a 65% fall during 2022. The Nasdaq listed stock remains closely watched by retail investors,” Bowman said.
Commenting on BP, Bowman said the financial pain from the pandemic now placed firmly behind it.
“BP during the February joined the throng of oil majors reporting bumper annual profits, helping its shares to a near 13% gain over the month. A dividend yield of over 3.5% now offers attraction.”
The most popular investment trusts for investors
According to interactive investor, these were the most popular investment trusts purchased via its platform in February 2023.
- Scottish Mortgage Investment Trust
- F&C Investment Trust
- City of London Investment Trust
- Greencoat UK Wind
- The Renewables Infrastructure Group
- Murray International
- Blackrock World Mining
- Alliance Trust
- Rit Capital Partners
- Merchants Trust
Scottish Mortgage Investment Trust continues to hold its top spot, despite falling by around 40% this year. Scottish Mortgage invests in businesses aiming to deliver high growth in the years to come and has consistently occupied the top spot since June 2019 – the recent performance woes have certainly not dented its popularity.
The top three - Scottish Mortgage, F&C and City of London - are some of the largest, oldest and most loved trusts with investors. City of London, Greencoat UK Wind, Renewables Infrastructure Group, Murray International and Merchants Trust are all income plays.
The Renewables Infrastructure Group and Alliance Trust have been in and out of ii’s top 10 in the last year.
• The author of this article has holdings in the Fundsmith Equity fund, shares in Lloyds, Scottish Mortgage Investment Trust and Alliance Trust.