80-20 Investor Best of the Best Selection – December 2023 Update

Commentary

Of the 30 funds in November’s BOTB, 18 funds have retained their place in December’s selection which is not surprising given that the BOTB as a whole was up almost 4% during the month. The chart below illustrates that the BOTB (the blue line) performed broadly in line with the average professionally managed fund from the Mixed Investment 40-85% Shares sector (grey line). The green line represents the BOTB's benchmark that uses the respective sector averages for each fund in the BOTB, assuming the same asset mix. It is interesting to note that the BOTB underperformed its benchmark which was, unusually, down to the performance of the low risk funds within the collection. The BOTB’s low risk funds have had a focus on short duration bonds, which in recent months has boosted the BOTB's performance when bond markets were in freefall. In fact, the top-performing funds in October's BOTB were short-dated bond funds.

However, November saw bond markets rebound as explained in November’s monthly newsletter. As such, long-dated bonds rallied much more strongly than their shorter-dated counterparts, hence the underperformance you see above.

The top-performing funds in November’s BOTB are highlighted below. There were some incredible performances from funds with exposure to US equities and tech stocks in particular, as falling bond yields and a weaker US dollar sparked a powerful rally.

Fund	November 2023 % return
Liontrust Global Technology	15.57
FTF Franklin US Opportunities	9.36
AXA Framlington Global Technology	8.83
CT Latin America	7.8
Artemis US Select	6.4
T. Rowe Price Global Focused Growth Equity	6.39
T. Rowe Price US Large Cap Growth Equity	6.32

At the other end of the scale were short-dated bond funds (as you'd expect), as well as a Japanese equity fund and an energy fund. The latter is likely a reflection of falling inflation expectations as well as a weaker economic outlook globally. Ironically, Thesis TM Tellworth UK Select (which is in my portfolio) achieved the same return in November as it did in October when it actually topped the BOTB's performance chart. So as you can see, November was a great month for investors regardless.

Fund	November 2023 % return
Thesis TM Tellworth UK Select	1.37
M&G Short Dated Corporate Bond	1.21
Premier Miton Strategic Monthly Income Bond	1.07
WS Morant Wright Nippon Yield	-0.05
WS Guinness Global Energy	-3.91

In terms of asset mix, not much has changed this month. UK equities exposure is marginally higher and US equities remain the biggest constituent of the BOTB asset mix. Apart from that the only real difference is the removal of the commodity exposure which appeared last month.  Overall the total equity exposure has decreased marginally and returned to 60%, down from to 62%. You can see the full asset mix breakdown later in this article.

Below I list this month's selection in full with the 18 funds that regained their place in black while the new additions are in green. As usual, I have included the full list sorted alphabetically by name and then by risk category.

December's Best of the Best Selection - (A-Z by fund name)

(funds unchanged from last month are in black while new additions are in green):

Name	Sector	ISIN Code	Risk
abrdn High Yield Bond	Sterling High Yield	GB00B79RR984	Lower risk
Artemis Global Income	Global Equity Income	GB00B5N99561	Medium risk
Artemis SmartGARP European Equity	Europe Excluding UK	GB00B2PLJD73	Higher risk
Artemis US Select	North America	GB00BMMV5105	Medium risk
AXA Framlington Global Technology	Technology & Technology Innovation	GB00B4W52V57	Higher risk
Barclays Wealth Wealth Global Markets 4	Mixed Investment 40-85% Shares	GB00B4ZFH287	Medium risk
CT High Yield Bond	Sterling High Yield	GB0008371014	Lower risk
CT Latin America	Latin America	GB0001531754	Higher risk
EdenTree Responsible and Sustainable European Equity	Europe Excluding UK	GB0008448333	Higher risk
Fidelity American Special Situations	North America	GB00B89ST706	Medium risk
FTF Franklin US Opportunities	North America	GB00B7KCG406	Higher risk
FTF Templeton Global Leaders	Global	GB00B7K6LK38	Medium risk
IFSL Marlborough High Yield Fixed Interest	Sterling High Yield	GB00B03TN153	Lower risk
Invesco Emerging Markets ex China (UK)	Global Emerging Markets	GB00B3RW8X82	Higher risk
Invesco Global Equity (UK)	Global	GB00B3RS9Q62	Medium risk
Invesco High Yield (UK)	Sterling High Yield	GB00B3RW7649	Lower risk
Jupiter India	India/Indian Subcontinent	GB00B2NHJ040	Higher risk
Jupiter Monthly Income Bond	Sterling Strategic Bond	GB00B1XG8187	Lower risk
L&G US Index Trust	North America	GB00B0CNGT73	Medium risk
Liontrust Global Technology	Technology & Technology Innovation	GB00BYXZ5N79	Higher risk
Liontrust India	India/Indian Subcontinent	GB00B1L6DV51	Higher risk
M&G Strategic Corporate Bond	Sterling Corporate Bond	GB00B4MQK815	Lower risk
Man GLG Japan Core Alpha	Japan	GB00B0119B50	Medium risk
Man GLG Sterling Corporate Bond	Sterling Corporate Bond	GB00BNLYQX62	Lower risk
Schroder High Yield Opportunities	Sterling High Yield	GB00B83RDY83	Lower risk
Schroder Income Maximiser	UK Equity Income	GB00B5B0KM51	Medium risk
Schroder Strategic Credit	Sterling Strategic Bond	GB00BJZ2ZC09	Lower risk
T. Rowe Price US Large Cap Growth Equity	North America	GB00BD5FHW12	Higher risk
Thesis TM Tellworth UK Select	Targeted Absolute Return	GB00BNY7YM73	Lower risk
WS Morant Wright Nippon Yield	Japan	GB00B42MKS95	Medium risk

December's Best of the Best Selection - (grouped by risk)

Here is December's shortlist grouped by their risk category (funds unchanged from last month are in black while new additions are in green):

Name	Sector	ISIN Code	Risk
abrdn High Yield Bond	Sterling High Yield	GB00B79RR984	Lower risk
CT High Yield Bond	Sterling High Yield	GB0008371014	Lower risk
IFSL Marlborough High Yield Fixed Interest	Sterling High Yield	GB00B03TN153	Lower risk
Invesco High Yield (UK)	Sterling High Yield	GB00B3RW7649	Lower risk
Jupiter Monthly Income Bond	Sterling Strategic Bond	GB00B1XG8187	Lower risk
M&G Strategic Corporate Bond	Sterling Corporate Bond	GB00B4MQK815	Lower risk
Man GLG Sterling Corporate Bond	Sterling Corporate Bond	GB00BNLYQX62	Lower risk
Schroder High Yield Opportunities	Sterling High Yield	GB00B83RDY83	Lower risk
Schroder Strategic Credit	Sterling Strategic Bond	GB00BJZ2ZC09	Lower risk
Thesis TM Tellworth UK Select	Targeted Absolute Return	GB00BNY7YM73	Lower risk
Artemis Global Income	Global Equity Income	GB00B5N99561	Medium risk
Artemis US Select	North America	GB00BMMV5105	Medium risk
Barclays Wealth Wealth Global Markets 4	Mixed Investment 40-85% Shares	GB00B4ZFH287	Medium risk
Fidelity American Special Situations	North America	GB00B89ST706	Medium risk
FTF Templeton Global Leaders	Global	GB00B7K6LK38	Medium risk
Invesco Global Equity (UK)	Global	GB00B3RS9Q62	Medium risk
L&G US Index Trust	North America	GB00B0CNGT73	Medium risk
Man GLG Japan Core Alpha	Japan	GB00B0119B50	Medium risk
Schroder Income Maximiser	UK Equity Income	GB00B5B0KM51	Medium risk
WS Morant Wright Nippon Yield	Japan	GB00B42MKS95	Medium risk
Artemis SmartGARP European Equity	Europe Excluding UK	GB00B2PLJD73	Higher risk
AXA Framlington Global Technology	Technology & Technology Innovation	GB00B4W52V57	Higher risk
CT Latin America	Latin America	GB0001531754	Higher risk
EdenTree Responsible and Sustainable European Equity	Europe Excluding UK	GB0008448333	Higher risk
FTF Franklin US Opportunities	North America	GB00B7KCG406	Higher risk
Invesco Emerging Markets ex China (UK)	Global Emerging Markets	GB00B3RW8X82	Higher risk
Jupiter India	India/Indian Subcontinent	GB00B2NHJ040	Higher risk
Liontrust Global Technology	Technology & Technology Innovation	GB00BYXZ5N79	Higher risk
Liontrust India	India/Indian Subcontinent	GB00B1L6DV51	Higher risk
T. Rowe Price US Large Cap Growth Equity	North America	GB00BD5FHW12	Higher risk

The funds that dropped out of the Best of the Best Selection

For reference, the funds from last month that dropped out of the 80-20 Investor Best of the Best list are listed below:

Name	Sector	ISIN Code	Risk
AXA Global Short Duration Bonds	Sterling Strategic Bond	GB00BDFZQV30	Lower risk
Fidelity American	North America	GB00B8GPC429	Medium risk
Fidelity Japan	Japan	GB00B882N041	Medium risk
L&G Global 100 Index Trust	Global	GB00B0CNH056	Medium risk
Lazard Emerging Markets	Global Emerging Markets	GB00B24F1G74	Higher risk
M&G Short Dated Corporate Bond	Sterling Corporate Bond	GB0031110397	Lower risk
Man GLG Absolute Value	Targeted Absolute Return	GB00BF1X8084	Lower risk
Premier Miton Strategic Monthly Income Bond	Sterling Strategic Bond	GB00BMWVS110	Lower risk
T. Rowe Price Global Focused Growth Equity	Global	GB00BD446774	Medium risk
UBS US Equity	North America	GB00B7V68L26	Medium risk
WS Canlife Short Duration Corporate Bond	Sterling Corporate Bond	GB00BD0CNM97	Lower risk
WS Guinness Global Energy	Commodity/Natural Resource	GB00B56FW078	Higher risk

The Asset mix

The current asset mix of the new Best of the Best Selection is shown below with last month's figures in brackets:

• Global Fixed Interest 24% (23%)
• UK Fixed Interest 0% (3%)
• Alternatives 14% (10%) - includes absolute return strategies
• North American Equities 27% (29%)
• American Emerging Market Equities 3% (4%)
• Asian Emerging Market Equities 8% (8%)
• European Equities 6% (6%)
• Japanese Equities 7% (7%)
• UK Equities 4% (2%)
• Cash 2% (2%)
• China Equities 0% (0%)
• Other international equities 5% (3%)
• Commodities and Energy 0% (3%)

80-20 Investor's outperformance continues

As you know the Best of the Best Selection is the shortlist of the best funds highlighted by our 80-20 Investor algorithm split into high, medium and low-risk categories. This shortlist is updated at the start of every month.

The green line in the chart below (click to enlarge) shows how a portfolio would have performed since inception (in August 2014) if it had been split equally between the Best of the Best Selection funds and then switched each month when each new shortlist was published. I have also charted the performance against that of the average cautious managed fund (blue line) and the average managed fund with up to 85% equity exposure (red line). In reality, the 80-20 Investor's asset allocation typically lies between these two as it usually has 40-60% exposure to equities at any one time. So they provide a good comparison of how fund managers with a similar remit have fared over the same period.

As you can see, since launch in August 2014 the 80-20 Investor BOTB has outperformed the average managed fund and the market.

 

 

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