Morningstar has just announced the winning funds for its Morningstar UK Fund Awards 2013. Liontrust has nabbed two top prizes in the following categories: UK Flex-Cap Equity funds and UK Small-Cap Equity funds.
These awards recognise specific funds that have added the most value for investors within their fund category in 2012.
The awards methodology emphasises performance in 2012, but funds must also have delivered strong three- and five-year returns in order to obtain an award. Furthermore, they must have been at least in the top half of their respective peer groups in at least three of the past five calendar years. Funds are also judged not only on past performance but also on risk measures and volatility. Therefore, funds are penalised if their returns had extreme downside variation.
Fund Awards by Category
Best UK Flex-Cap Equity Fund:
Liontrust Special Situations fund
Morningstar Analyst Rating: 
Bronze
The Liontrust Special Situations fund is managed by the highly experienced Anthony Cross and Julian Fosh, who each bring more than 20 years of industry experience. Within this UK companies mandate, Cross and Fosh implement a process that focuses on the importance of the intangible assets of a company, with an emphasis on intellectual capital, distribution channels, and repeat business. The fund has produced excellent returns since inception, outperforming the Morningstar UK Flex-Cap category by 8.2% on an annualised basis. Recent performance has been particularly strong with the fund outperforming the category by 11.7% annualised over the last three years.
Best UK Small-Cap Equity Fund:
Liontrust UK Smaller Companies fund
Morningstar Analyst Rating: Bronze
The Liontrust UK Smaller Companies fund is also managed by Anthony Cross and Julian Fosh, who focus on the importance of the intangible assets of a company. They also look to invest in companies where there is significant management ownership. Performance of the fund has been exceptionally strong over the last five years, returning 12.2% on an annualised basis and outperforming the UK Small-Cap Equity category, which returned 5.8%. The fund also has low volatility; its standard deviation is 3.6% lower than the category average.
Best UK Large-Cap Equity Fund:
Majedie UK Equity fund
No analyst rating
Majedie only manages UK equities and they do so very well. Over the five–year period ending December 31, 2012, the Majedie Asset UK Equity fund returned an annualised 6.52%, more than double that achieved by the FTSE All Share Index or the category average. The fund is run by four highly experienced fund managers; three of whom were founding partners of the firm. This stability at the helm has without a doubt been a benefit to their investors.
Best GBP Corporate Bond Fund:
Baillie Gifford Corporate Bond fund
No analyst rating
The Baillie Gifford Corporate Bond fund is managed by Stephen Rodger and Torcail Stewart. The fund incorporates meaningful exposure to both investment grade and high-yield corporate bonds, drawing on the team’s established and differentiated approach to bond fund management. The process places significant emphasis on company research, seeking to identify higher-yielding bonds within both the investment-grade and high-yield universes where they believe valuations over-emphasise company credit risk. This is an unconstrained strategy that can lead to elevated volatility relative to credit benchmarks and sector averages. But over the past three years, the strategy has led to exceptional returns as the team's higher-yielding holdings, such as those in sub-investment-grade bonds, have been handsomely rewarded: the fund has returned 45.6% over this period, compared to its average peer's return of 26.9%.
These four funds were amongst 10 funds that were given Morningstar UK Fund Awards for 2013.
Click below to see other funds in the following categories:
- UK Flex-Cap Equity
- UK Small-Cap Equity
- UK Large-Cap Equity
- GBP Corporate Bond
