80-20 Investor Best of the Best Selection – July 2021 Update

Commentary

Of the 30 funds in June's BOTB, 17 funds have retained their place in July's selection. The chart below shows the performance of the BOTB against a benchmark that is calculated using the respective sector averages for each fund in the BOTB and assuming the same asset mix.

What it highlights is how the markets shift in inflation expectations, following the US Federal Reserve's policy meeting on 15th June, impacted markets. As described in July's monthly newsletter, the reflation trade lagged portfolios focused on growth stocks in the second half of June. Given the BOTB's focus on value/cyclical assets that is why we saw the BOTB lag from the 15th June onwards (as shown above). Of course, this is only a two week period and 80-20 Investor focuses on momentum over a longer time period than that.

Nonetheless, the recent repricing of markets has had an impact on this month's BOTB. While 17 funds remain the same and the overall asset mix is similar, with a slightly increased exposure to US equities, we now see funds with more growth exposure creeping in, and even technology stocks once again. We have also seen the introduction of a property equity fund for the first time in a long time.

In terms of the overall equity exposure of the BOTB, it has risen slightly to 61%, up from 58%.

At the foot of this article, you can see how the 80-20 Investor selection continues to outperform the professional fund managers as well as the market since its launch almost seven years ago.

Below I list this month's selection in full with the 17 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.

July'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
Artemis Global Equity	Global	GB00B2PLJP95	Medium risk
Aviva Inv UK Smaller Companies	UK Smaller Companies	GB0004457312	Medium risk
AXA Framlington Managed Income	Sterling Strategic Bond	GB00B7H1PG56	Low risk
AXA Framlington UK Smaller Companies	UK Smaller Companies	GB00B7MMLM18	High risk
Barclays Multi-Asset Cautious	Mixed Investment 0-35% Shares	GB00BD93Z723	Low risk
BM Brooks Macdonald Defensive Capital	Targeted Absolute Return	GB00B61MR835	Low risk
BMO North American Equity	North America	GB0030281405	Medium risk
CFP Castlefield Real Return	Targeted Absolute Return	GB00B12V1482	Low risk
Fidelity Emerging Europe Middle East and Africa	Specialist	GB00B87Z7808	High risk
Fidelity Global Property	Property Other	GB00B7K2NZ09	Medium risk
Fidelity UK Smaller Companies	UK Smaller Companies	GB00B7VNMB18	High risk
FP Apollo Multi Asset Balanced	Mixed Investment 20-60% Shares	GB00B3FPF276	Low risk
FP Octopus UK Multi Cap Income	UK Equity Income	GB00BG47Q333	Medium risk
FP Pictet Multi Asset Portfolio	Targeted Absolute Return	GB00BVYTTC41	Low risk
Invesco High Yield (UK)	Sterling High Yield	GB00B3RW7649	Low risk
JPM Natural Resources	Specialist	GB0031835118	High risk
Liontrust India	Specialist	GB00B1L6DV51	High risk
Marlborough European Multi-Cap	Europe Excluding UK	GB0001719730	High risk
Marlborough Far East Growth	Asia Pacific Excluding Japan	GB00B0NVCN62	Medium risk
Marlborough Technology	Technology & Telecommunications Retai	GB0032832841	High risk
Premier Miton Defensive Growth	Targeted Absolute Return	GB00B832BD89	Low risk
Premier Miton Worldwide Opportunities	Flexible Investment	GB0031831133	Medium risk
Schroder High Yield Opportunities	Sterling High Yield	GB00B83RDY83	Low risk
Schroder QEP Global Active Value	Global	GB00B76V8G74	Medium risk
Schroder Small Cap Discovery	Specialist	GB00B5ZS9V71	High risk
Schroder UK Dynamic Smaller Companies	UK Smaller Companies	GB0007220360	High risk
Slater Recovery	UK All Companies	GB0031554248	Medium risk
T. Bailey Dynamic	Mixed Investment 20-60% Shares	GB00B1385S07	Low risk
UBS US Equity	North America	GB00B7V68L26	Medium risk
VT De Lisle America	North America	GB00B3QF3G69	High risk

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

Here is July'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
AXA Framlington Managed Income	Sterling Strategic Bond	GB00B7H1PG56	Low risk
Barclays Multi-Asset Cautious	Mixed Investment 0-35% Shares	GB00BD93Z723	Low risk
BM Brooks Macdonald Defensive Capital	Targeted Absolute Return	GB00B61MR835	Low risk
CFP Castlefield Real Return	Targeted Absolute Return	GB00B12V1482	Low risk
FP Apollo Multi Asset Balanced	Mixed Investment 20-60% Shares	GB00B3FPF276	Low risk
FP Pictet Multi Asset Portfolio	Targeted Absolute Return	GB00BVYTTC41	Low risk
Invesco High Yield (UK)	Sterling High Yield	GB00B3RW7649	Low risk
Premier Miton Defensive Growth	Targeted Absolute Return	GB00B832BD89	Low risk
Schroder High Yield Opportunities	Sterling High Yield	GB00B83RDY83	Low risk
T. Bailey Dynamic	Mixed Investment 20-60% Shares	GB00B1385S07	Low risk
Artemis Global Equity	Global	GB00B2PLJP95	Medium risk
Aviva Inv UK Smaller Companies	UK Smaller Companies	GB0004457312	Medium risk
BMO North American Equity	North America	GB0030281405	Medium risk
Fidelity Global Property	Property Other	GB00B7K2NZ09	Medium risk
FP Octopus UK Multi Cap Income	UK Equity Income	GB00BG47Q333	Medium risk
Marlborough Far East Growth	Asia Pacific Excluding Japan	GB00B0NVCN62	Medium risk
Premier Miton Worldwide Opportunities	Flexible Investment	GB0031831133	Medium risk
Schroder QEP Global Active Value	Global	GB00B76V8G74	Medium risk
Slater Recovery	UK All Companies	GB0031554248	Medium risk
UBS US Equity	North America	GB00B7V68L26	Medium risk
AXA Framlington UK Smaller Companies	UK Smaller Companies	GB00B7MMLM18	High risk
Fidelity Emerging Europe Middle East and Africa	Specialist	GB00B87Z7808	High risk
Fidelity UK Smaller Companies	UK Smaller Companies	GB00B7VNMB18	High risk
JPM Natural Resources	Specialist	GB0031835118	High risk
Liontrust India	Specialist	GB00B1L6DV51	High risk
Marlborough European Multi-Cap	Europe Excluding UK	GB0001719730	High risk
Marlborough Technology	Technology & Telecommunications Retai	GB0032832841	High risk
Schroder Small Cap Discovery	Specialist	GB00B5ZS9V71	High risk
Schroder UK Dynamic Smaller Companies	UK Smaller Companies	GB0007220360	High risk
VT De Lisle America	North America	GB00B3QF3G69	High 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
Barings Global Agriculture	Specialist	GB00B3B9V927	High risk
BNY Mellon Real Return	Targeted Absolute Return	GB00B7VVXF60	Low risk
FP Apollo Multi Asset Cautious	Mixed Investment 20-60% Shares	GB00B3FPDY55	Low risk
Lazard Emerging Markets	Global Emerging Markets	GB00B24F1G74	High risk
MI Chelverton UK Equity Growth	UK All Companies	GB00BP855B75	Medium risk
MI Thornbridge Global Opportunities	Global	GB00B5TP8W88	Medium risk
Premier Miton Diversified Growth	Mixed Investment 40-85% Shares	GB00B8BJV423	Medium risk
Premier Miton UK Smaller Companies	UK Smaller Companies	GB00B818N094	High risk
Schroder Global Equity Income	Global Equity Income	GB00B76V7M69	Medium risk
Schroder MM Diversity	Mixed Investment 20-60% Shares	GB00B60CZD52	Low risk
Schroder Strategic Bond	Sterling Strategic Bond	GB00B7FPS593	Low risk
Schroder UK Smaller Companies	UK Smaller Companies	GB00B76V7Z98	High risk
Wise Funds Limited TB Wise Multi-Asset Growth	Flexible Investment	GB0034272533	Medium 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 8% (8%)
• Alternatives 21% (21%) - includes absolute return strategies & some bond exposure
• UK Corporate Fixed Interest (i.e UK bonds) 0% (0%)
• Emerging Market Fixed Income 0% (0%)
• North American Equities 13% (9%)
• European Equities 4% (4%)
• Chinese Equities 0% (0%)
• Japanese Equities 0% (0%)
• Property 4% (0%)
• UK Equities 22% (25%)
• Gilts 0% (0%)
• Cash 4% (5%)
• Asian / Emerging market equities 10% (7%)
• Other international equities 8% (13%)
• Commodities and Energy 6% (8%)

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 a FTSE 100 tracker fund (the black line) and 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 portfolio has outperformed the average managed fund and the market.

 

 

 

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