The best performing funds to invest in right now

16 min Read Published: 16 Jun 2021

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 (last updated June 2021). 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
Rosemary Banyard VT Downing Unique Opportunities 1.54
Tom Slater Baillie Gifford Long Term Global Growth Investment 1.35
Richard Power / Dominic Weller FP Octopus UK Micro Cap Growth / FP Octopus UK Multi Cap Income 1.34
Will Sutcliffe Baillie Gifford Emerging Markets Leading Companies 1.33
James Baker MI Chelverton UK Equity Growth 1.32
Gary Robinson Baillie Gifford American / Baillie Gifford Global Stewardship 1.28
Carlos Moreno / Thomas Brown Premier Miton European Opportunities 1.25
Matthew Tonge / Victoria Stevens Liontrust UK Smaller Companies / Liontrust UK Micro Cap 1.25
Jeremy Gleeson AXA Framlington Global Technology 1.24
Richard Clode Janus Henderson Global Technology Leaders 1.20

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 June 2016 (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 Performance rank June 2006 to June 2016 (out of 132) Performance rank June 2016 to June 2021 (out of 183)
Slater Growth 1 6
Franklin UK Mid Cap 2 41
ASI UK Unconstrained Equity 3 146
Royal London UK Mid-Cap Growth 4 40
Liontrust Special Situations 5 20
BMO UK Mid-Cap 6 164
Threadneedle UK Mid 250 7 72
Marlborough Multi-Cap Growth 8 22
SVM UK Growth 9 67
Schroder UK Opportunities 10 172

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 14th June 2021.

The top-performing funds over 10 years

Asia Pacific Excluding Japan

Fund 10 Year Fund Performance %
Baillie Gifford Pacific 351.43
Schroder Asian Alpha Plus 212.70
Jupiter Merian Asia Pacific 211.95
Barings Eastern Trust 188.33
Ninety One Asia Pacific Franchise 187.66
Average 130.07

Europe Excluding UK

Fund 10 Year Fund Performance %
Baillie Gifford European 305.09
Marlborough European Multi-Cap 284.08
BlackRock European Dynamic 272.72
BlackRock Continental European 241.07
Allianz Continental European 235.25
Average 134.86

Japan

Fund 10 Year Fund Performance %
Baillie Gifford Japanese 260.26
JPM Japan 246.19
AXA Framlington Japan 205.84
Fidelity Japan Smaller Companies 196.56
LF Morant Wright Nippon Yield 172.07
Average 150.46

Mixed Investment 0%-35% Shares

Fund 10 Year Fund Performance %
Omnis Investments Ltd Omnis Managed Cautious 81.01
Sarasin Income & Reserves 69.25
Fidelity Multi Asset Income 65.96
L&G Mixed Investment 0-35% 60.79
Threadneedle Managed Bond Focused 60.61
Average 45.83

Mixed Investment 20%-60% Shares

Fund 10 Year Fund Performance %
Royal London Sustainable Diversified Trust 154.28
AXA Global Distribution 115.12
Premier Miton Multi-Asset Distribution 100.84
Premier Miton Multi-Asset Monthly Income 95.43
AXA Ethical Distribution 93.59
Average 62.09

Mixed Investment 40%-85% Shares

Fund 10 Year Fund Performance %
Royal London Sustainable World Trust 275.73
Baillie Gifford Managed 208.90
Liontrust Sustainable Future Managed 201.56
COIF Charities Investment 169.58
Omnis Investments Ltd Omnis Managed Adventurous 151.69
Average 91.93

North America

Fund 10 Year Fund Performance %
Baillie Gifford American 875.98
UBS US Growth 451.91
AXA Framlington American Growth 422.42
Franklin US Opportunities 397.59
Jupiter Merian North American Equity 378.84
Average 294.20

Sterling Corporate Bond

Fund 10 Year Fund Performance %
Janus Henderson Inst Long Dated Credit 108.72
Schroder Sterling Corporate Bond 95.82
Royal London Corporate Bond 84.36
L&G Managed Monthly Income Trust 80.76
Liontrust Sustainable Future Corporate Bond 77.56
Average 58.41

Sterling High Yield

Fund 10 Year Fund Performance %
Invesco High Yield (UK) 90.75
Schroder High Yield Opportunities 81.30
AXA Global High Income 76.33
Baillie Gifford High Yield Bond 74.85
AXA Pan European High Yield Bond 74.01
Average 60.56

Sterling Strategic Bond

Fund 10 Year Fund Performance %
Allianz Strategic Bond 97.63
Artemis High Income 89.82
Baillie Gifford Strategic Bond 83.67
Royal London Ethical Bond 83.06
Invesco Monthly Income Plus (UK) 76.92
Average 54.63

UK All Companies

Fund 10 Year Fund Performance %
Jupiter UK Mid Cap 258.10
Slater Growth 250.52
Premier Miton Ethical 237.35
AXA Framlington UK Mid Cap 232.45
Royal London Sustainable Leaders Trust 231.54
Average 103.90

UK Smaller Companies

Fund 10 Year Fund Performance %
Liontrust UK Smaller Companies 411.54
ES R&M UK Equity Smaller Companies 407.10
LF Gresham House UK Micro Cap 374.53
Marlborough UK Micro Cap Growth 344.64
AXA Framlington UK Smaller Companies 334.80
Average 212.55

The top-performing funds over 5 years

Asia Pacific Excluding Japan

Fund 5 Year Fund Performance %
Baillie Gifford Pacific 245.85
JPM Asia Growth 185.83
Fidelity Asia Pacific Opportunities 159.45
Barings Eastern Trust 158.83
Schroder Asian Alpha Plus 156.17
Average 98.79

Europe Excluding UK

Fund 5 Year Fund Performance %
Premier Miton European Opportunities 198.70
Baillie Gifford European 167.70
Marlborough European Multi-Cap 161.25
BlackRock European Dynamic 144.61
BlackRock Continental European 142.71
Average 80.21

Japan

Fund 5 Year Fund Performance %
FSSA Japan Focus 115.70
Baillie Gifford Japanese 106.23
Fidelity Japan 95.46
Liontrust Japan Equity 88.35
Threadneedle Japan 86.26
Average 70.23

Mixed Investment 0%-35% Shares

Fund 5 Year Fund Performance %
Royal London Sustainable Managed Growth Trust 44.06
Omnis Investments Ltd Omnis Managed Cautious 35.71
True Potential Investments True Potential Cautious 1 35.66
True Potential Investments True Potential Cautious 3 34.10
EF Brompton Global Conservative 31.77
Average 22.66

Mixed Investment 20%-60% Shares

Fund 5 Year Fund Performance %
Royal London Sustainable Diversified Trust 72.69
Liontrust Sustainable Future Defensive Managed 58.36
AXA Global Distribution 55.71
Rathbone Active Income and Growth Fund 53.73
Barclays Wealth Global Markets 3 52.59
Average 32.24

Mixed Investment 40%-85% Shares 

Fund 5 Year Fund Performance %
Baillie Gifford Managed 116.47
Royal London Sustainable World Trust 116.33
Liontrust Sustainable Future Managed 105.23
LF Ruffer European 91.39
Premier Miton Diversified Growth 87.27
Average 50.38

North America

Fund 5 Year Fund Performance %
Baillie Gifford American 390.81
UBS US Growth 173.43
AXA Framlington American Growth 173.35
Ninety One American Franchise 166.67
Natixis Loomis Sayles U.S. Equity Leaders 158.56
Average 114.87

Sterling Corporate Bond

Fund 5 Year Fund Performance %
Schroder Sterling Corporate Bond 47.69
Janus Henderson Inst Long Dated Credit 36.00
Rathbone Ethical Bond Fund 31.65
Royal London Corporate Bond 30.42
Jupiter Investment Grade Bond 29.98
Average 21.83

Sterling High Yield

Fund 5 Year Fund Performance %
Schroder High Yield Opportunities 41.53
L&G High Income Trust 36.41
Invesco High Yield (UK) 35.33
AXA Global High Income 33.82
Fidelity Global High Yield 31.91
Average 29.33

Sterling Strategic Bond

Fund 5 Year Fund Performance %
Allianz Strategic Bond 44.83
GAM Credit Opportunities GBP 39.08
Schroder Strategic Bond 36.53
Jupiter Monthly Income Bond 35.96
AXA Framlington Managed Income 35.92
Average 22.35

UK All Companies

Fund 5 Year Fund Performance %
MI Chelverton UK Equity Growth 193.90
Slater Recovery 134.50
VT Sorbus Vector 128.75
VT The Beagle 123.29
Slater Growth 110.89
Average 51.55

UK Smaller Companies

Fund 5 Year Fund Performance %
FP Octopus UK Micro Cap Growth 191.47
Liontrust UK Micro Cap 162.35
TB TB Amati UK Smaller Companies 144.85
Marlborough UK Micro Cap Growth 144.16
Jupiter UK Smaller Companies Equity 137.30
Average 99.10