The market sell-off that began in February 2020 has been the fastest ever bear market. In a matter of weeks, equity markets were down almost 40% across the board. Investors were caught out by the speed and unforgiving nature of the sell-off. As my recent newsletters have explained, there have been few havens. Even bonds capitulated alongside other traditional haven assets such as gold.
Positive momentum across asset markets evaporated and the downtrend has not yet been reversed. It has, of course, meant that the 80-20 Investor BFBS tables have dwindled leaving just a smattering of funds, mostly invested in government bonds, such as gilts and treasuries. In fact the table below shows the only funds out of the 2,320 unit trusts out there to have made a profit during the sell-off between 20th February and the low of the 23rd March.
| Name | Member Of | ISIN Code | % Return 20/02/2020 to 23/03/2020 |
| M&G Global Government Bond | Global Bonds | GB00B7J76C49 | 1.16 |
| M&G European Corporate Bond | Global Bonds | GB00B7MT0707 | 0.91 |
| Royal London European Corporate Bond | Global Bonds | GB00BG0ZNN01 | 1.76 |
| ASI Euro Corporate Bond | Global Bonds | GB00BWK27T75 | 0.29 |
| BNY Mellon International Bond | Global Bonds | GB0006779655 | 9.73 |
| Courtiers Investment Grade Bond | Global Bonds | GB00BYXVV711 | 2.6 |
| iShares Overseas Government Bond Index (UK) | Global Bonds | GB00B849C803 | 12.84 |
| Janus Henderson Inst Overseas Bond | Global Bonds | GB0007673055 | 10.88 |
| M&G Global Macro Bond | Global Bonds | GB00B78PLC47 | 9.17 |
| Royal London International Government Bond | Global Bonds | GB00B45XHL18 | 0.44 |
| Scottish Widows International Bond | Global Bonds | GB0031910978 | 11.56 |
| T. Rowe Price Dynamic Global Bond | Global Bonds | GB00BD0NLR34 | 1.08 |
| Threadneedle Dollar Bond | Global Bonds | GB0002771946 | 6.71 |
| Threadneedle European Bond | Global Bonds | GB0002773769 | 7.47 |
| Threadneedle Global Bond | Global Bonds | GB0001533685 | 11.44 |
| Thesis PM | Mixed Investment 40-85% Shares | GB00B3V32G87 | 0.52 |
| Aviva Inv Asia Pacific Property | Property Other | GB00B2RJM074 | 11.9 |
| TIME Investments Freehold Income Authorised | Property Other | GB00B9LV6956 | 0.2 |
| TM Home Investor | Property Other | GB00B9608795 | 0.07 |
| ASI Strategic Investment Allocation | Specialist | GB00B1YXMW71 | 27.12 |
| VT Clear Peak Capital UK Long/Short Equity | Specialist | GB00BJXS2B80 | 4.74 |
| Allianz Strategic Bond | Sterling Strategic Bond | GB00B06T9362 | 7.87 |
| FP Carmignac Unconstrained Global Bond | Sterling Strategic Bond | GB00BJHPJ035 | 2.48 |
| Schroder SUTL Cazenove Charity Bond | Sterling Strategic Bond | GB00BF784C14 | 1.52 |
| Argonaut FP Argonaut Absolute Return | Targeted Absolute Return | GB00B7FT1K78 | 10.07 |
| Jupiter Absolute Return | Targeted Absolute Return | GB00B5129B32 | 0.5 |
| Omnis Investments Ltd Omnis Diversified Returns | Targeted Absolute Return | GB00BJ5FRR89 | 1.27 |
| TM Fulcrum Diversified Absolute Return | Targeted Absolute Return | GB00B7N2V536 | 7.37 |
| ASI Sterling Long Dated Government Bond | UK Gilts | GB00BZ4BR247 | 6 |
| ASI UK Government Bond | UK Gilts | GB00B6WZXS38 | 3.77 |
| HSBC Common Fund for Income | UK Gilts | GB0003458311 | 1.25 |
| iShares Over 15 Years Gilts Index (UK) | UK Gilts | GB00BF338G29 | 5.55 |
| Janus Henderson Inst Long Dated Gilt | UK Gilts | GB00BJ0LFY40 | 4.76 |
| ASI Sterling Short Term Government Bond | UK Gilts | GB00BWK25J38 | 1.15 |
| Royal London Short Duration Gilts | UK Gilts | GB00BD050C73 | 0.4 |
| Wesleyan Risk Averse | UK Gilts | GB00BYNYHM79 | 0.89 |
| SJP Gilts | UK Gilts | GB00B8XD9J37 | 0.64 |
| HSBC UK Gilt Index | UK Gilts | GB00B4581C50 | 3.08 |
| L&G All Stocks Gilt Index Trust | UK Gilts | GB00B8344798 | 2.99 |
| iShares UK Gilts All Stocks Index (UK) | UK Gilts | GB00B83HGR24 | 3.03 |
| PUTM Bothwell Sub-Sovereign Bond | UK Gilts | GB00BYZK4J99 | 0.09 |
| LF Canlife UK Government Bond | UK Gilts | GB00BLDYKJ43 | 3.31 |
| ASI (AAM) Sterling Government Bond | UK Gilts | GB00BWK26Q79 | 3.59 |
| HSBC Gilt & Fixed Interest | UK Gilts | GB0000154681 | 2.84 |
| Threadneedle UK Fixed Interest | UK Gilts | GB00BD8GMJ34 | 2.94 |
| Threadneedle Sterling Bond | UK Gilts | GB0002777745 | 2.93 |
| Schroder Gilt & Fixed Interest | UK Gilts | GB00BYTQ7F09 | 2.82 |
| Quilter Investors Gilt Index | UK Gilts | GB0032543984 | 3.99 |
| Omnis UK Gilt | UK Gilts | GB00BF0XDK42 | 3.27 |
| Janus Henderson Inst UK Gilt | UK Gilts | GB00BJ0LG189 | 2.33 |
| Epworth Sovereign Bond For Charities | UK Gilts | GB00BJBT2V31 | 2.93 |
| M&G Gilt & Fixed Interest Income | UK Gilts | GB0031108433 | 2.46 |
| Royal London UK Government Bond | UK Gilts | GB00B881TW52 | 2.23 |
| Santander Sterling Government Bond | UK Gilts | GB00BSTLRD18 | 2.11 |
| Allianz Gilt Yield | UK Gilts | GB0031383283 | 3.46 |
| Franklin UK Gilt | UK Gilts | GB00BYZCTV27 | 3.58 |
| Vanguard UK Long Duration Gilt Index | UK Gilts | GB00B4M89245 | 7.65 |
| Scottish Widows Gilt | UK Gilts | GB00B8DK6372 | 2.12 |
97% of unit trusts lost money during the sell-off, irrespective of the underlying assets they invested in. More notably only 4 Targeted Absolute Return funds made a profit, as shown above, which is poor given that they are often marketed as being able to make money in most market conditions. If the market downtrend were to resume and the coronavirus outbreak escalate then obviously cash is the only guaranteed safe place to be. But trying to time the market (exiting and then re-entering) is almost impossible to get right. If investors want to remain invested in the market it does raise the question of where might they invest other than perhaps the funds listed above. Especially if they want exposure to certain equity markets or sectors. Which have proved most resilient in the market downturn, albeit having still lost money?
What has made this sell-off particularly tricky to navigate is that historical precedents have not been followed. Bond funds have performed poorly and even defensive equity sectors have been hammered at times. The rule book has been torn up, largely because we've never encountered a situation like this where large swathes of the global population are in lockdown.
However, it is possible to identify those funds that fared better than their peers during the sell-off. That doesn't mean they haven't fallen in value, significantly in some cases. But you can identify those funds that have shown a level of consistency before and after the start of the market slump, relative to their peers. There are funds that have shown signs of relative strength during this crisis. Of course, that's not to say they will continue to perform well if the market continues to slump but, recent history suggests they've been weathering this storm better than their peers.
To identify those funds I decided to look at the performance during three key periods, which are listed below
- The three months prior to the sell-off (which began on 20th February)
- The period from the beginning of the sell-off to the recent low on 23rd March
- The period from the beginning of the sell-off to the 27th March (the rebound high)
For ease I will call these:
- pre-bear market
- worst of the bear market
- after a bear market rebound
Normally when I look at funds and consistency I often include statistics such as the alpha, beta etc (see my consistent funds post). However, given the speed and ferocity of this sell-off such statistics are difficult to determine. As such I just focused on the performance of funds, versus their peers, during the three periods listed above.
For each period I calculated the performance of all 2,320 unit trust funds out there and then ranked them within their respective sectors from best to worst. For a fund to make the shortlist it had to:
- have performed better than the average of its peer group in the lead up to the sell-off (pre-bear market). The reason for this is because if I just focused on the performance of the funds during the sell-off I would just reproduce the list above which is full of defensive assets/funds. I am looking to determine the funds that were performing above average in a rising market that then rode the coronavirus pandemic sell-off better than their peers.
- also have been in the top 10% of performers for their respective sectors during the worst of the bear market sell-off to date. Of course that will still mean that equity-based funds will be showing some hefty losses but relative to their peers they have preserved capital better.
- finally, the funds had to remain in the top quartile of funds within their sector (top 25%) even after the recent bear market rally. We don't just want funds that won't achieve any of the upside when the recovery eventually hits.
This left 77 funds which are listed below alongside their ISIN number and their respective performance figures across each time frame analysed. I have also included the sector averages for each timeframe for comparison purposes.
| Fund | Sector | ISIN Code | Pre-bear market | Worst of the Bear Market | After a bear market rebound |
| Allianz Total Return Asian Equity | Asia Pacific Excluding Japan | GB00B1FRQV53 | 6.26 | -13.68 | -9.48 |
| Investec Asia Pacific Franchise | Asia Pacific Excluding Japan | GB00B85KZC70 | 8.51 | -17.28 | -14.53 |
| JPM Asia Growth | Asia Pacific Excluding Japan | GB00B1XMSK57 | 6.1 | -17.64 | -13.4 |
| Barings Eastern Trust | Asia Pacific Excluding Japan | GB0000799923 | 4.46 | -16.73 | -13.99 |
| Fidelity Asia | Asia Pacific Excluding Japan | GB00B6Y7NF43 | 5.38 | -17.8 | -14.92 |
| Sector average | 4.07 | -21.71 | -17.69 | ||
| ASI Europe ex UK Equity | Europe Excluding UK | GB00B0LG6N13 | 8.82 | -21.57 | -16.25 |
| Jupiter European | Europe Excluding UK | GB0006664683 | 8.64 | -21.97 | -16.17 |
| Liontrust Sustainable Future European Growth | Europe Excluding UK | GB0030029390 | 10.12 | -22.17 | -17.31 |
| FP Carmignac European Leaders | Europe Excluding UK | GB00BJHPHZ49 | 10.13 | -22.04 | -17.62 |
| Threadneedle European Select | Europe Excluding UK | GB0001529345 | 6.18 | -21.54 | -16.05 |
| Fidelity European | Europe Excluding UK | GB00BFRT3504 | 6.64 | -22 | -17.59 |
| Smith & Williamson European Equity | Europe Excluding UK | GB0008192840 | 7.3 | -23.71 | -19.29 |
| L&G European Trust | Europe Excluding UK | GB00B7J5FY33 | 9.86 | -22.92 | -16.98 |
| Sector average | 5.35 | -27.07 | -21.91 | ||
| Troy Asset Management Ltd Trojan Ethical | Flexible Investment | GB00BJP0XX17 | 4.56 | -8.58 | -4.43 |
| Troy Asset Management Ltd Trojan | Flexible Investment | GB0034243732 | 5 | -9.86 | -5.76 |
| First State Diversified Growth | Flexible Investment | GB00BVXC2S15 | 6.11 | -11.09 | -12.67 |
| Thesis The Diversification ICVC | Flexible Investment | GB0031645491 | 5.24 | -11.68 | -11.04 |
| Thesis Staderas | Flexible Investment | GB00B4ZLBD51 | 4.53 | -10.21 | -9.03 |
| Sector average | 4.49 | -20.66 | -16.66 | ||
| FP Carmignac Emerging Markets | Global Emerging Markets | GB00BK1W2P36 | 8.96 | -21.11 | -15.54 |
| Schroder Global Emerging Markets | Global Emerging Markets | GB00B76V5Q67 | 6.06 | -21.8 | -19.25 |
| Sector average | 5.25 | -24.77 | -20.98 | ||
| Troy Asset Management Ltd Trojan Global Income | Global Equity Income | GB00BD82KP33 | 6.29 | -18.31 | -14.16 |
| Premier Global Optimum Income | Global Equity Income | GB00BFZND652 | 5.09 | -20.92 | -17.33 |
| TB Chawton Global Equity Income | Global Equity Income | GB00BJ1GXX37 | 9.1 | -21.81 | -16.8 |
| Sector average | 5.64 | -26.97 | -21.61 | ||
| Schroder Global Healthcare | Global | GB00B76V7Q08 | 11.08 | -15.4 | -12.35 |
| SJP International Equity | Global | GB0008377250 | 11.45 | -18.77 | -15.85 |
| L&G Global Health & Pharmaceuticals Index Trust | Global | GB00B0CNH387 | 7.99 | -17.21 | -13.33 |
| SJP Worldwide Income | Global | GB00BZ5Z1C39 | 8.56 | -19.23 | -15.21 |
| Artemis Global Select | Global | GB00B568S201 | 7.22 | -19.4 | -16.2 |
| Baillie Gifford Long Term Global Growth Investment | Global | GB00BD5Z0Z54 | 25.05 | -19.5 | -12.57 |
| Elite EF Rosevine Capital Global Equity | Global | GB00BFWYM202 | 13.54 | -19.61 | -13.48 |
| COIF Charities Global Equity Income | Global | GB00B29KPX27 | 10.74 | -19.49 | -14.88 |
| Thesis Lion Growth | Global | GB0008222936 | 10.14 | -18.95 | -14.17 |
| Dundas Partners LLP Heriot Global | Global | GB00B99M6Y59 | 7.84 | -19.31 | -13.34 |
| Sector average | 7.05 | -24.02 | -19.01 | ||
| Threadneedle Japan | Japan | GB0001529121 | -1.25 | -8.53 | -5.06 |
| Sector average | -3.63 | -14.61 | -8.82 | ||
| Vanguard LifeStrategy 20% Equity | Mixed Investment 0-35% Shares | GB00B4NXY349 | 3.16 | -7.51 | -5.22 |
| Sector average | 2.54 | -11.99 | -9.64 | ||
| Sarasin GlobalSar Strategic | Mixed Investment 20-60% Shares | GB00B8DPZ138 | 4.99 | -11.64 | -9.4 |
| Zurich Horizon Multi-Asset I | Mixed Investment 20-60% Shares | GB00BTKH4895 | 3.97 | -11.95 | -8.7 |
| FP Carmignac Patrimoine | Mixed Investment 20-60% Shares | GB00BK1W2N12 | 6.43 | -11.34 | -9.26 |
| Vanguard Target Retirement 2015 | Mixed Investment 20-60% Shares | GB00BZ6VHV15 | 3.18 | -11.87 | -9 |
| Sector average | 3.15 | -17.74 | -14.2 | ||
| DMS Stirling House Balanced | Mixed Investment 40-85% Shares | GB00B99R1674 | 4.73 | -10.56 | -8.78 |
| Barclays Multi-Impact Growth | Mixed Investment 40-85% Shares | GB00BYPZYN82 | 5.17 | -15.65 | -12.29 |
| Margetts Sentinel Growth Portfolio | Mixed Investment 40-85% Shares | GB00BZ0P5600 | 5.96 | -13.66 | -12.39 |
| TM Cerno Pacific | Mixed Investment 40-85% Shares | GB00BDCJ9Z32 | 9.52 | -14.06 | -8.47 |
| DMS Stirling House Growth | Mixed Investment 40-85% Shares | GB00B99R1450 | 6.03 | -14.3 | -12.15 |
| Liontrust Balanced | Mixed Investment 40-85% Shares | GB00B85K7211 | 10.13 | -16.8 | -11.96 |
| Thesis TM Private Portfolio | Mixed Investment 40-85% Shares | GB00B9N2ZM26 | 4.56 | -15.35 | -12.1 |
| Thesis Latour Growth | Mixed Investment 40-85% Shares | GB00B54VZ198 | 4.97 | -16.04 | -12.66 |
| DMS Kleinwort Hambros Multi Asset Balanced | Mixed Investment 40-85% Shares | GB00B15PCY48 | 4.51 | -15.45 | -13.06 |
| Sector average | 4.34 | -21.48 | -17.18 | ||
| Artemis US Extended Alpha | North America | GB00BMMV5G59 | 10.19 | -21.92 | -17.8 |
| Morgan Stanley US Advantage | North America | GB00BZ4CG750 | 14.36 | -20.41 | -15.05 |
| Investec American Franchise | North America | GB00B839DR76 | 11.17 | -22.69 | -16.23 |
| Marlborough US Multi-Cap Income | North America | GB0001722882 | 10.34 | -18.9 | -15.75 |
| Sector average | 8.93 | -26.02 | -20.77 | ||
| ASI Strategic Investment Allocation | Specialist | GB00B1YXMW71 | 4.62 | 27.12 | 17.69 |
| LF Bentley US Dollar Balanced | Specialist | GB00B0XQ3L61 | 4.23 | -4.25 | -6.11 |
| LF Ruffer Gold | Specialist | GB00B8510Q93 | 13.25 | -4.4 | -0.4 |
| Sector average | 4.15 | -23.77 | -19.38 | ||
| Barclays Sterling Bond | Sterling Strategic Bond | GB00B72Y6K08 | 3.13 | -0.93 | -0.32 |
| Sector average | 2.61 | -10.13 | -8.11 | ||
| Argonaut FP Argonaut Absolute Return | Targeted Absolute Return | GB00B7FT1K78 | 18.17 | 10.07 | 5.83 |
| Kames UK Equity Absolute Return | Targeted Absolute Return | GB00B504CH73 | 2.94 | -0.2 | 0.52 |
| Sector average | 2.32 | -9.87 | -8.2 | ||
| VT Castlebay UK Equity | UK All Companies | GB00BV0LF607 | 6.15 | -26.01 | -19.88 |
| Scottish Widows Environmental Investor | UK All Companies | GB00B7KLBY27 | 7.31 | -23.95 | -18.57 |
| VT Vanneck Equity | UK All Companies | GB00BJ4G2665 | 5.75 | -28.43 | -21.88 |
| IFML Vitality UK Listed Equity | UK All Companies | GB00BFWVCM12 | 6.24 | -29.08 | -20.84 |
| Liontrust Special Situations | UK All Companies | GB00B57H4F11 | 5.69 | -29.6 | -22.63 |
| VT The Beagle | UK All Companies | GB00B5SL2W51 | 10.49 | -21.68 | -21.68 |
| Royal London Sustainable Leaders Trust | UK All Companies | GB00B7V23Z99 | 10.14 | -27.39 | -20.07 |
| MFM Bowland | UK All Companies | GB0008265307 | 9.38 | -24.06 | -24.06 |
| CFP SDL Free Spirit | UK All Companies | GB00BYYQC271 | 11.85 | -28.81 | -22.93 |
| Unicorn Outstanding British Companies | UK All Companies | GB00B1GFWW16 | 9.12 | -29.79 | -25.07 |
| Sector average | 6.09 | -35.72 | -28.27 | ||
| ES R&M UK Equity Income | UK Equity Income | GB00B3KQG447 | 6 | -30.13 | -20.55 |
| Fidelity Enhanced Income | UK Equity Income | GB00B87HPZ94 | 5.71 | -30.82 | -23.52 |
| FP Octopus UK Multi Cap Income | UK Equity Income | GB00BG47Q333 | 11.76 | -28.96 | -23.94 |
| LF Gresham House UK Multi Cap Income | UK Equity Income | GB00BYXVGS75 | 13.29 | -30.13 | -26.26 |
| Sector average | 5.37 | -35.68 | -28.5 | ||
| iShares Over 15 Years Gilts Index (UK) | UK Gilts | GB00BF338G29 | 3.99 | 5.55 | 6.2 |
| Vanguard UK Long Duration Gilt Index | UK Gilts | GB00B4M89245 | 4.96 | 7.65 | 7.06 |
| ASI Sterling Long Dated Government Bond | UK Gilts | GB00BZ4BR247 | 3.96 | 6 | 6.62 |
| Sector average | 2.18 | 2.56 | 3.13 | ||
| FP Octopus UK Micro Cap Growth | UK Smaller Companies | GB00BYQ7HN43 | 12.66 | -29.92 | -23.75 |
| Liontrust UK Smaller Companies | UK Smaller Companies | GB00B57TMD12 | 15.1 | -32.56 | -26.44 |
| Sector average | 11.32 | -37.96 | -31.69 |
