Commentary
This month's BOTB follows on from last month's success. Of the 30 funds in April's BOTB, 19 funds have retained their place in May's selection. This is in stark contrast to last time when only 8 funds in March's BOTB made it into April's BOTB. The chart below shows the performance during the month of April of the BOTB against the typical professionally managed funds.
It is good to see that the sweeping changes made last time, moving the BOTB away from growth funds in favour of value/cyclical funds, have been rewarded. In fact every single fund in April's BOTB ended the month in positive territory. The table below shows the performance of the top-performing funds during April.
| Fund | April % return |
| Marlborough European Multi-Cap | 9.43 |
| Schroder UK Smaller Companies | 6.94 |
| FP Octopus UK Micro Cap Growth | 6.38 |
| Fidelity UK Smaller Companies | 5.38 |
| Wise Funds Limited TB Wise Multi-Asset Growth | 4.75 |
Given the performance of the BOTB, it is unsurprising that the asset mix of the new BOTB remains almost identical to last month's. UK equities remain the largest component of the BOTB, especially smaller companies stocks. Also a reduced exposure to bonds (the lowest for some time) in favour of absolute return funds and multi-asset funds remains the case. There is still no place for gilt funds after their dismal performance in recent months. The overall equity exposure of the BOTB sits around 61%, which is marginally lower than last month's 63%.
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 six and a half years ago.
Below I list this month's selection in full with the 19 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.
May'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 Growth | Global | GB00B2PLJP95 | Medium risk |
| Artemis Global Income | Global Equity Income | GB00B5N99561 | Medium risk |
| Aviva Inv UK Smaller Companies | UK Smaller Companies | GB0004457312 | High risk |
| AXA Framlington Managed Income | Sterling Strategic Bond | GB00B7H1PG56 | Low risk |
| Barings Global Agriculture | Specialist | GB00B3B9V927 | High risk |
| Barings Multi Asset | Targeted Absolute Return | GB00B3VBC734 | Low risk |
| BM Brooks Macdonald Defensive Capital | Targeted Absolute Return | GB00B61MR835 | Low risk |
| BNY Mellon Real Return | Targeted Absolute Return | GB00B7VVXF60 | Low risk |
| ES R&M UK Recovery | UK All Companies | GB00B614J053 | 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 Pictet Multi Asset Portfolio | Targeted Absolute Return | GB00BVYTTC41 | Low risk |
| HSBC Pacific Index | Asia Pacific Excluding Japan | GB0000150713 | Medium risk |
| Invesco Global Emerging Markets (UK) | Global Emerging Markets | GB00B3RW7S64 | High risk |
| Invesco Global Smaller Companies (UK) | Global | GB00B3RS8K36 | High risk |
| Invesco High Yield (UK) | Sterling High Yield | GB00B3RW7649 | Low risk |
| Jupiter Income Trust | UK Equity Income | GB0004791389 | Medium risk |
| Jupiter UK Smaller Companies Equity | UK Smaller Companies | GB0004911870 | High risk |
| L&G Pacific Index Trust | Asia Pacific Excluding Japan | GB00B0CNGY27 | Medium risk |
| Marlborough European Multi-Cap | Europe Excluding UK | GB0001719730 | High risk |
| Marlborough High Yield Fixed Interest | Sterling High Yield | GB00B03TN153 | Low risk |
| Premier Miton Worldwide Opportunities | Flexible Investment | GB0031831133 | Medium risk |
| Schroder MM Diversity | Mixed Investment 20-60% Shares | GB00B60CZD52 | Low risk |
| Schroder QEP Global Active Value | Global | GB00B76V8G74 | Medium risk |
| Schroder Strategic Bond | Sterling Strategic Bond | GB00B7FPS593 | Low risk |
| Schroder UK Smaller Companies | UK Smaller Companies | GB00B76V7Z98 | High risk |
| Schroder US Mid Cap | North America | GB00B7LDLV43 | Medium risk |
| SVM UK Opportunities | UK All Companies | GB0032064304 | High risk |
| VT De Lisle America | North America | GB00B3QF3G69 | High risk |
| Wise Funds Limited TB Wise Multi-Asset Growth | Flexible Investment | GB0034272533 | Medium risk |
May's Best of the Best Selection - (grouped by risk)
Here is May'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 |
| Barings Multi Asset | Targeted Absolute Return | GB00B3VBC734 | Low risk |
| BM Brooks Macdonald Defensive Capital | Targeted Absolute Return | GB00B61MR835 | Low risk |
| BNY Mellon Real Return | Targeted Absolute Return | GB00B7VVXF60 | 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 |
| Marlborough High Yield Fixed Interest | Sterling High Yield | GB00B03TN153 | Low risk |
| Schroder MM Diversity | Mixed Investment 20-60% Shares | GB00B60CZD52 | Low risk |
| Schroder Strategic Bond | Sterling Strategic Bond | GB00B7FPS593 | Low risk |
| Artemis Global Growth | Global | GB00B2PLJP95 | Medium risk |
| Artemis Global Income | Global Equity Income | GB00B5N99561 | Medium risk |
| ES R&M UK Recovery | UK All Companies | GB00B614J053 | Medium risk |
| HSBC Pacific Index | Asia Pacific Excluding Japan | GB0000150713 | Medium risk |
| Jupiter Income Trust | UK Equity Income | GB0004791389 | Medium risk |
| L&G Pacific Index Trust | Asia Pacific Excluding Japan | GB00B0CNGY27 | Medium risk |
| Premier Miton Worldwide Opportunities | Flexible Investment | GB0031831133 | Medium risk |
| Schroder QEP Global Active Value | Global | GB00B76V8G74 | Medium risk |
| Schroder US Mid Cap | North America | GB00B7LDLV43 | Medium risk |
| Wise Funds Limited TB Wise Multi-Asset Growth | Flexible Investment | GB0034272533 | Medium risk |
| Aviva Inv UK Smaller Companies | UK Smaller Companies | GB0004457312 | High risk |
| Barings Global Agriculture | Specialist | GB00B3B9V927 | High risk |
| Fidelity UK Smaller Companies | UK Smaller Companies | GB00B7VNMB18 | High risk |
| Invesco Global Emerging Markets (UK) | Global Emerging Markets | GB00B3RW7S64 | High risk |
| Invesco Global Smaller Companies (UK) | Global | GB00B3RS8K36 | High risk |
| Jupiter UK Smaller Companies Equity | UK Smaller Companies | GB0004911870 | High risk |
| Marlborough European Multi-Cap | Europe Excluding UK | GB0001719730 | High risk |
| Schroder UK Smaller Companies | UK Smaller Companies | GB00B76V7Z98 | High risk |
| SVM UK Opportunities | UK All Companies | GB0032064304 | 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 |
| Allianz UK Opportunities | UK All Companies | GB00B8BB9445 | High risk |
| Artemis SmartGARP Global Emerging Markets Equity | Global Emerging Markets | GB00BW9HL132 | Medium risk |
| Courtiers Total Return Cautious Risk | Mixed Investment 20-60% Shares | GB00B1P2K418 | Low risk |
| Fidelity American Special Situations | North America | GB00B89ST706 | High risk |
| FP Octopus UK Micro Cap Growth | UK Smaller Companies | GB00BYQ7HN43 | High risk |
| Invesco Asian (UK) | Asia Pacific Excluding Japan | GB00B1W7HW60 | Medium risk |
| Premier Miton UK Value Opportunities | UK All Companies | GB00B8KV0M06 | High risk |
| Schroder Global Equity Income | Global Equity Income | GB00B76V7M69 | Medium risk |
| Schroder High Yield Opportunities | Sterling High Yield | GB00B83RDY83 | Low risk |
| Schroder Monthly Income | Mixed Investment 20-60% Shares | GB00B78ST188 | Low risk |
| Schroder UK Dynamic Absolute Return | Targeted Absolute Return | GB00B3N74T57 | Low 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 11% (11%)
- Alternatives 18% (17%) - includes absolute return strategies & some bond exposure
- UK Corporate Fixed Interest (i.e UK bonds) 0% (3%)
- Emerging Market Fixed Income 0% (0%)
- North American Equities 14% (12%)
- European Equities 4% (3%)
- Chinese Equities 0% (0%)
- Japanese Equities 0% (0%)
- Property 0% (0%)
- UK Equities 23% (24%)
- Gilts 0% (0%)
- Cash 5% (5%)
- Asian / Emerging market equities 8% (10%)
- Other international equities 12% (10%)
- Commodities and Energy 5% (5%)
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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