The best performing funds to invest in right now

7 min Read Published: 04 Jan 2023

The best performing funds to invest in right nowIn this article, I list the best performing funds over 10 years and 5 years. I also highlight the best investment fund managers in the UK. Yet you shouldn’t just focus on past performance over 5 or 10 years alone.

As one of the most frequently quoted investment experts in the UK national press, including The Times and The Telegraph, I will show you how to pick the best performing funds to invest now. That is very different from simply opting for the best performing funds over the last 5 or 10 years.

In fact I would invest in hardly any of the top performing funds over the last 5 or 10 years and neither should you

Funds are inconsistent and you should invest in funds that suit the current economic and investment environment. I will show you how I successfully identify the best funds to invest in with an increased chance of performing well going forward.

First of all...the funds to avoid

Before I move on to the best funds to invest in it's also important to be aware of the funds to avoid. Unfortunately, there are a number of popular funds that should be avoided as they will hit your returns. You can download a useful list of these funds which the research calls 'dog funds'. So feel free to download the guide and use it as a reference point.

Best performing investment funds to invest in

The 10 Top Performing Fund Managers

Fund managers seldom outperform the market in the short term and almost never over the long term. Yet that doesn't mean you should just invest in index trackers or Exchange Traded Funds (ETFs). There is still a place for picking the best active investment fund managers. However, the top performing investment fund managers historically won't outperform the market or their peers all of the time. The table in the next section of this article emphasises the impact on the returns of your misplaced loyalty to even the best fund managers. The key is to invest in the best funds when the investment environment suits them and to ditch them when it doesn't, in favour of their peers most likely to outperform. You should NEVER invest your money with a fund manager for the long term.

The table below shows the 10 top performing fund managers over the last five years (up to the start of 2022). I analysed the returns of thousands of fund managers versus the level of risk they took with investors' money to arrive at the final table. The best investment fund managers do not gamble with investors' money, instead, they invest it strategically to minimise any losses. The Sharpe Ratio is a measure of the level of excess return the fund manager earns for the extra risk he/she has taken. The higher the figure the better.

Fund Manager Main fund managed Sharpe ratio
Nigel Ashfield ARC TIME Freehold Income Authorised 1.65
Anthony Eaton VT Downing Global Investors 1.33
Jeremy Gleeson AXA Framlington Global Technology 1.30
Richard Clode Janus Henderson Global Technology Leaders 1.26
Carlos Moreno / Thomas Brown Premier Miton European Opportunities 1.24
Peter J. Bye UBS US Growth 1.23
Tom Slater Baillie Gifford Long Term Global Growth Investment 1.18
Stephen Kelly AXA Framlington American Growth 1.15
Terry Smith Fundsmith Equity 1.14
Will Sutcliffe Baillie Gifford Emerging Markets Leading Companies 1.12

How to pick the best performing funds to invest in now

The key to successful investing is to pick the funds most likely to outperform their peers in the future. That is not the same as picking the funds or fund managers with the best performance over the last 5 or 10 years.

By way of example if you had picked the 10 best performing funds over 10 years leading up to January 2017 (from the UK All Companies sector) and then invested in them over the next 5 years you'd have been in for a surprise. As the table below shows, over the next 5 years you would have been better off investing in alternative funds within the same sector.

Fund Fund performance rank 2007 to 2017 (out of 134) Fund performance rank 2017 to 2022 (out of 178)
Slater Growth 1 3
Liontrust Special Situations 2 20
IFSL Marlborough Special Situations 3 8
Royal London UK Mid-Cap Growth 4 22
ASI UK Unconstrained Equity 5 90
FTF Franklin UK Mid Cap 6 25
Unicorn Outstanding British Companies 7 153
BMO UK Mid-Cap 8 152
Schroder UK Opportunities 9 168
Schroder Recovery 10 123

So how can you choose the best funds to invest in right now? The world of fund management brainwashes investors into thinking that you have to buy and hold a fund manager or fund. Yet why should you? The evidence overwhelmingly shows that no fund manager outperforms in every market condition. The fact that a fund manager or fund might top a table of the best performing managers (or funds) over 5 years is just a coincidence of the timeframe used. Use another timeframe (as shown above) and they won't come anywhere near the top. This is true of every fund, even the most popular investment funds. 

So if you can't rely on long term performance tables to pick funds that are more likely to perform well in the future then how can you do it?

The key to investing is to choose the best funds to invest in for the current environment and to use a process that screens out the noise and emotional headlines and focuses on the fundamentals. It's a very simple process that I explain in a short email series How to become a successful DIY investor. In the emails I show you:

  • The most important investment lesson you will ever learn based on over 100 years of research and experience
  • The simple and easy to use tool that will help you beat the market
  • The investment process fund managers want to keep to themselves.
  • How to know which funds to buy and which to sell, in minutes.

I have used the technique to help investors outperform the market and professional fund managers using only a few minutes a month, using 80-20 Investor. You can read their reviews of 80-20 Investor as well as see the performance in the widget at the foot of this article. I also successfully run £50,000 of my own money live on the site to show how simple it is. 80-20 Investor helps you to simply decide the funds to invest in via your existing fund platform. Find out more about how the service works and take advantage of a 30 day FREE trial.

The top-performing funds over 5 years and 10 years

The tables below show the best performing funds to invest in over 5 years and 10 years. All these funds can be held in a Stocks and Shares ISA or a Self Invested Personal Pension (SIPP). The percentage return shown is the total return figures which assumes all income and dividends are reinvested. The funds are grouped by fund sector so you can see the best performing funds for the most popular fund sectors.

While the funds below would have been the best funds to invest in over the last 10 years and 5 years, within their respective sectors, there is no evidence that they will continue to perform well as I explained earlier. In fact, taking such a long term view masks long periods of underperformance as I explained in the section above, titled How to pick the best performing funds to invest in now.

The data below shows the 5 and 10 year performance periods ending 18th December 2022.

The top-performing funds over 10 years

Asia Pacific Excluding Japan

Fund 10 Year Fund Performance %
Baillie Gifford Pacific 210.67
Invesco Asian (UK) 158.05
Jupiter Merian Asia Pacific 155.35
Fidelity Sustainable Asia Equity 152.42
Schroder Asian Alpha Plus 131.78
Average 102.05

Europe Excluding UK

Fund 10 Year Fund Performance %
IFSL Marlborough European Special Situations 248.35
SVM Continental Europe 204.33
BlackRock Continental European 201.94
BlackRock European Dynamic 201.92
Liontrust European Dynamic 198.86
Average 119.32

Japan

Fund 10 Year Fund Performance %
Baillie Gifford Japanese 193.68
M&G Japan 186.46
Janus Henderson Japan Opportunities 178.86
AXA Framlington Japan 177.11
Fidelity Japan 168.55
Average 135.22

Mixed Investment 0%-35% Shares

Fund 10 Year Fund Performance %
Royal London Sustainable Managed Growth Trust 54.45
Omnis Investments Ltd Omnis Managed Cautious 50.92
L&G Mixed Investment 0-35% 43.30
7IM Income Portfolio 42.73
BlackRock Consensus 35 40.67
Average 25.80

Mixed Investment 20%-60% Shares

Fund 10 Year Fund Performance %
Royal London Sustainable Diversified Trust 105.84
Artemis Monthly Distribution 100.97
AXA Global Sustainable Distribution 83.19
Courtiers Total Return Cautious Risk 74.12
Huntress IFSL Ravenscroft Balanced 74.00
Average 43.49

Mixed Investment 40%-85% Shares

Fund 10 Year Fund Performance %
Royal London Sustainable World Trust 200.00
COIF Charities Investment 150.30
Liontrust Sustainable Future Managed 141.51
Janus Henderson Global Responsible Managed 136.98
Vanguard LifeStrategy 80% Equity 124.54
Average 73.84

North America

Fund 10 Year Fund Performance %
AXA Framlington American Growth 343.68
Jupiter Merian North American Equity 342.14
CT North American Equity 341.08
Ninety One American Franchise 335.23
UBS US Growth 325.94
Average 253.93

Sterling Corporate Bond

Fund 10 Year Fund Performance %
Schroder Sterling Corporate Bond 41.12
Royal London Corporate Bond 36.63
Royal London Sterling Credit 33.43
Rathbone Ethical Bond Fund 31.71
BlackRock Corporate Bond 29.58
Average 19.20

Sterling High Yield

Fund 10 Year Fund Performance %
Schroder High Yield Opportunities 59.20
Invesco High Yield (UK) 42.36
abrdn High Yield Bond 41.86
AXA Global High Income 41.27
abrdn European High Yield Bond 35.65
Average 30.26

Sterling Strategic Bond

Fund 10 Year Fund Performance %
GAM Credit Opportunities GBP 72.34
AXA Framlington Managed Income 63.57
Artemis High Income 48.73
Invesco Monthly Income Plus (UK) 47.58
Allianz Strategic Bond 40.73
Average 23.16

UK All Companies

Fund 10 Year Fund Performance %
Slater Recovery 201.69
Royal London Sustainable Leaders Trust 180.62
Slater Growth 175.49
Artemis SmartGARP UK Equity 164.11
TB Evenlode Income 160.70
Average 77.32

UK Smaller Companies

Fund 10 Year Fund Performance %
ES R&M UK Listed Smaller Companies 240.56
Liontrust UK Smaller Companies 230.83
Fidelity UK Smaller Companies 217.61
LF Gresham House UK Micro Cap 210.86
TB TB Amati UK Listed Smaller Companies 193.06
Average 124.83

The top-performing funds over 5 years

Asia Pacific Excluding Japan

Fund 5 Year Fund Performance %
Baillie Gifford Pacific 56.19
Fidelity Asia Pacific Opportunities 54.18
Schroder Institutional Pacific 41.37
Jupiter Asian Income 37.37
Fidelity Asian Dividend 33.99
Average 19.19

Europe Excluding UK

Fund 5 Year Fund Performance %
Liontrust European Dynamic 60.72
Premier Miton European Opportunities 59.47
BlackRock Continental European 58.37
SVM Continental Europe 53.21
Fidelity European 48.54
Average 17.69

Japan

Fund 5 Year Fund Performance %
Fidelity Japan 44.34
FSSA Japan Focus 21.61
Jupiter Japan Income 17.15
CT Japan 17.08
Janus Henderson Japan Opportunities 16.30
Average 7.33

Mixed Investment 0%-35% Shares

Fund 5 Year Fund Performance %
SJP Conservative International Growth 19.36
VT Chelsea Managed Cautious Growth 16.59
7IM Income Portfolio 14.81
True Potential Investments True Potential Cautious 2 11.08
VT Smartfund Cautious Strategy 10.43
Average 1.20

Mixed Investment 20%-60% Shares

Fund 5 Year Fund Performance %
VT Chelsea Managed Monthly Income 30.19
Royal London Sustainable Diversified Trust 27.71
LF Ruffer Total Return 26.87
Schroder MM Diversity 22.35
Premier Miton Diversified Income 21.83
Average 6.03

Mixed Investment 40%-85% Shares 

Fund 5 Year Fund Performance %
Royal London Sustainable World Trust 48.74
COIF Charities Investment 45.19
BNY Mellon Multi-Asset Balanced 37.84
Liontrust Sustainable Future Managed 36.32
Janus Henderson Global Responsible Managed 35.99
Average 14.97

North America

Fund 5 Year Fund Performance %
AXA Framlington American Growth 95.06
SVS Sanlam North American Equity 86.78
Ninety One American Franchise 80.95
UBS US Growth 72.69
Fidelity Index US 71.57
Average 55.44

Sterling Corporate Bond

Fund 5 Year Fund Performance %
Schroder Sterling Corporate Bond 5.61
M&G Short Dated Corporate Bond 3.79
Fidelity Short Dated Corporate Bond 1.26
AXA Sterling Credit Short Duration Bond 1.24
L&G Active Short Dated Sterling Corporate Bond 0.46
Average -5.17

Sterling High Yield

Fund 5 Year Fund Performance %
Schroder High Yield Opportunities 8.80
M&G Global Floating Rate High Yield 8.00
Invesco High Yield (UK) 7.40
abrdn High Yield Bond 7.21
AXA Global High Income 6.91
Average 3.68

Sterling Strategic Bond

Fund 5 Year Fund Performance %
Jupiter Merian Global Strategic Bond 20.71
Allianz Strategic Bond 17.58
Jupiter Monthly Income Bond 15.56
L&G Dynamic Bond 14.03
Invesco Tactical Bond (UK) 13.52
Average 0.58

UK All Companies

Fund 5 Year Fund Performance %
VT Sorbus Vector 50.64
MI MI Chelverton UK Equity Growth 49.40
Royal London Sustainable Leaders Trust 44.74
Slater Recovery 44.22
Premier Miton UK Growth 40.91
Average 8.13

UK Smaller Companies

Fund 5 Year Fund Performance %
Liontrust UK Micro Cap 65.48
VT Teviot UK Smaller Companies 53.61
Liontrust UK Smaller Companies 37.92
Fidelity UK Smaller Companies 36.81
FP Octopus UK Micro Cap Growth 25.97
Average 7.88