June completely flipped the performance table for funds, with China on top last month after a torrid year. Energy and natural resources have been the categories that have thrived in the current economic climate and they’ve topped the charts all year, often with double-digit growth. But that changed in June.
China funds returned to the top of the charts after months of looking almost uninvestable to some. The Morningstar China index began a slow climb around mid-May and is now up more than 10% in GBP over the past quarter.
The top performing fund in June was FFSA China A Shares. The Bronze-rated fund returned 13.95% in June and was the first of four China A-share funds topping the charts, with the rest all up around 12% in June. All four funds in the category have managed to grow by about 10% in the past three months.
The next six funds were all China or Greater China equity funds that all saw returns around the 10% mark.
We have to look beyond the top 10 for funds from any other categories. AQR Managed Futures, a systematic trend fund, was the 11th best performer with a gain of 9.18%. It also outshone all the top 10 funds when comparing second quarter numbers – it returned 19.73% in three months.
Two thematic funds investing in biotechnology (Candriam Equities L Biotechnology and Franklin Biotechnology Discovery) were also just shy of making it to the top 10 with returns of around 7%. The quarterly returns are however slightly less impressive. The two funds were down 0.05% and 4.05% respectively.
It is worth noting that only 102 funds of our almost 800-fund dataset made positive returns in June.
The worst performer, JP Morgan Global Natural Resources, shed 15.21% in Jine, and its sibling JP Morgan Natural Resources was down 13.31%. In Q2, both funds returned a negative 8-10%.
Latin America funds were another category that didn't do well – unsurprising as the makeup of the Latam index is leaning heavily on natural resources. These funds had a strong start to 2022, however, but have faded recently.
Other than that, one Korea fund – JPM Korea Equity – also had a tough month. As in other countries, recession fears are dampening market sentiment and the country’s central bank is expected to increase interest rate for the sixth time this year.