80-20 Investor Best of the Best Selection – June 2020 Update

Commentary

June's BOTB looks very familiar to May's with 21 funds the same. Again the message is consistency. It again demonstrates the resilience of the funds that made the BOTB last month. The average return from the BOTB was 3.63% but there were many notable winners. That is quite an impressive return when you consider that the portfolio only had a 37% exposure to equities during a month where stock markets continued higher. Comparable professionally managed funds on average returned 2.63% but with as much as 60% equity exposure. Yet again, BOTB regulars such as Baillie Gifford Positive Return produced some staggering returns.

Name	May performance %
Morgan Stanley US Advantage	13.13
Liontrust Global Technology	10.34
T. Rowe Price Global Technology Equity	9.68
Baillie Gifford Positive Change	8.99
Baillie Gifford Long Term Global Growth Investment	8.8

At the other end of the spectrum, only five funds didn't make a profit and these were focused on government bonds and Chinese equities. However the average loss was only 0.37%

The BOTB asset mix has remained almost the same as last month, but equity exposure has now increased to 42%. Most of this is via US equities and bonds but there is now some exposure to Japanese equities. UK equities continue to remain almost absent which is a reflection of the fact that the UK stock market continues to lag its peers.

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 over five years ago.

Below I list this month's selection in full with the 21 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.

June'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
Allianz Gilt Yield	UK Gilts	GB0031383283	Medium risk
Allianz Strategic Bond	Sterling Strategic Bond	GB00B06T9362	Low risk
ASI (AAM) Sterling Government Bond	UK Gilts	GB00BWK26Q79	Low risk
ASI AAA Bond	Sterling Corporate Bond	GB00B3W48X95	Low risk
ASI UK Government Bond	UK Gilts	GB00B6WZXS38	Medium risk
AXA Framlington Biotech	Specialist	GB00B784NS11	High risk
AXA Framlington Global Technology	Technology & Telecommunications	GB00B4W52V57	High risk
AXA Sterling Strategic Bond	Sterling Strategic Bond	GB00B02Y6L20	Low risk
Baillie Gifford China	China/Greater China	GB00B39RMM81	High risk
Baillie Gifford European	Europe Excluding UK	GB0006058258	High risk
Baillie Gifford Long Term Global Growth Investment	Global	GB00BD5Z0Z54	High risk
Baillie Gifford Positive Change	Global	GB00BYVGKV59	High risk
BlackRock European Absolute Alpha	Targeted Absolute Return	GB00B4Y62W78	Low risk
BNY Mellon International Bond	Global Bonds	GB0006779655	Medium risk
JPM Global Macro	Targeted Absolute Return	GB00B09RGL45	Low risk
JPM Japan	Japan	GB00B1XMTP77	Medium risk
Kames UK Equity Absolute Return	Targeted Absolute Return	GB00B504CH73	Low risk
LF Canlife Global Macro Bond	Global Bonds	GB00B4LW2X97	Medium risk
LF Canlife UK Government Bond	UK Gilts	GB00BLDYKJ43	Medium risk
LF Miton UK Smaller Companies	UK Smaller Companies	GB00B818N094	High risk
Liontrust Global Technology	Technology & Telecommunications	GB00BYXZ5N79	High risk
Merian Global Strategic Bond	Sterling Strategic Bond	GB00B1XG7L17	Low risk
Morgan Stanley US Advantage	North America	GB00BZ4CG750	High risk
Royal London Global Index Linked	Global Bonds	GB00B772RM82	Low risk
Royal London UK Government Bond	UK Gilts	GB00B881TW52	Medium risk
Schroder Global Healthcare	Global	GB00B76V7Q08	Medium risk
T. Rowe Price Dynamic Global Bond	Global Bonds	GB00BD0NLR34	Low risk
T. Rowe Price Global Technology Equity	Technology & Telecommunications	GB00BD446K01	High risk
Threadneedle Global Bond	Global Bonds	GB0001533685	Medium risk
Troy Asset Management Ltd Trojan Ethical	Flexible Investment	GB00BJP0XX17	Medium risk

 

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

Here is June'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
Allianz Strategic Bond	Sterling Strategic Bond	GB00B06T9362	Low risk
ASI (AAM) Sterling Government Bond	UK Gilts	GB00BWK26Q79	Low risk
ASI AAA Bond	Sterling Corporate Bond	GB00B3W48X95	Low risk
AXA Sterling Strategic Bond	Sterling Strategic Bond	GB00B02Y6L20	Low risk
BlackRock European Absolute Alpha	Targeted Absolute Return	GB00B4Y62W78	Low risk
JPM Global Macro	Targeted Absolute Return	GB00B09RGL45	Low risk
Kames UK Equity Absolute Return	Targeted Absolute Return	GB00B504CH73	Low risk
Merian Global Strategic Bond	Sterling Strategic Bond	GB00B1XG7L17	Low risk
Royal London Global Index Linked	Global Bonds	GB00B772RM82	Low risk
T. Rowe Price Dynamic Global Bond	Global Bonds	GB00BD0NLR34	Low risk
Allianz Gilt Yield	UK Gilts	GB0031383283	Medium risk
ASI UK Government Bond	UK Gilts	GB00B6WZXS38	Medium risk
BNY Mellon International Bond	Global Bonds	GB0006779655	Medium risk
JPM Japan	Japan	GB00B1XMTP77	Medium risk
LF Canlife Global Macro Bond	Global Bonds	GB00B4LW2X97	Medium risk
LF Canlife UK Government Bond	UK Gilts	GB00BLDYKJ43	Medium risk
Royal London UK Government Bond	UK Gilts	GB00B881TW52	Medium risk
Schroder Global Healthcare	Global	GB00B76V7Q08	Medium risk
Threadneedle Global Bond	Global Bonds	GB0001533685	Medium risk
Troy Asset Management Ltd Trojan Ethical	Flexible Investment	GB00BJP0XX17	Medium risk
AXA Framlington Biotech	Specialist	GB00B784NS11	High risk
AXA Framlington Global Technology	Technology & Telecommunications	GB00B4W52V57	High risk
Baillie Gifford China	China/Greater China	GB00B39RMM81	High risk
Baillie Gifford European	Europe Excluding UK	GB0006058258	High risk
Baillie Gifford Long Term Global Growth Investment	Global	GB00BD5Z0Z54	High risk
Baillie Gifford Positive Change	Global	GB00BYVGKV59	High risk
LF Miton UK Smaller Companies	UK Smaller Companies	GB00B818N094	High risk
Liontrust Global Technology	Technology & Telecommunications	GB00BYXZ5N79	High risk
Morgan Stanley US Advantage	North America	GB00BZ4CG750	High risk
T. Rowe Price Global Technology Equity	Technology & Telecommunications	GB00BD446K01	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
ASI Sterling Bond	Global Bonds	GB00BWK26Y53	Medium risk
AXA Framlington American Growth	North America	GB00B5LXGG05	High risk
AXA Framlington Health	Specialist	GB00BRJZVQ71	High risk
Barclays Sterling Bond	Sterling Strategic Bond	GB00B72Y6K08	Medium risk
JPM Global Ex UK Bond	Global Bonds	GB0030877210	Low risk
Royal London International Government Bond	Global Bonds	GB00B45XHL18	Low risk
Schroder Gilt & Fixed Interest	UK Gilts	GB00BYTQ7F09	Medium risk
Threadneedle China Opportunities	China/Greater China	GB00B1PRW734	High risk
Vanguard UK Long Duration Gilt Index	UK Gilts	GB00B4M89245	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 31% (27%)
• Alternatives 8% (11%) - includes absolute return strategies & some bond exposure
• UK Corporate Fixed Interest (i.e UK bonds) 0% (2%)
• Emerging Market Fixed Income 2% (0%)
• North American Equities 21% (26%)
• European Equities 8% (5%)
• Japanese Equities 4% (0%)
• Property 0% (0%)
• UK Equities 3% (0%)
• Gilts 16% (21%)
• Cash 3% (2%)
• Emerging market equities 0% (2%)
• Other international equities 0% (0%)
• Asian Equities 4% (4%)
• Commodities and Energy 0% (0%)

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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