TD Recommended Funds performance

Q3 2016 Performance Summary

The third quarter was a very positive one for markets. IT led the way, up 16.4%, with strong performance from emerging market equities and in particular Asia Pacific equities, materials, Japanese equities, financials and UK index-linked bonds. The FTSE All Share index gained 7.8% over the quarter.

Our Recommended Funds list serves as a reflection of this strong market performance, with every single one of the 61 funds delivering a positive return. Man GLG Japan CoreAlpha was the best performing fund, up 20.9%, with good performance also coming from Henderson Global Technology, Liontrust UK Smaller Companies, Old Mutual Europe ex UK Smaller Companies (a new addition to the list), Schroder Tokyo, M&G Global Emerging Markets, Veritas Asian, Baillie Gifford International and Schroder Asian Income, all of which returned more than 13% over the quarter.

Absolute return funds generally did their job, with Henderson UK Absolute Return, Newton Real Return and Kames UK Equity Absolute Return all underperforming the FTSE All Share but delivering a positive return. Meanwhile BlackRock Gold & General, which remains the top performer year-to-date, delivered a more modest return in the third quarter as the gold price came under pressure.

We continue to stress the importance of investing across different asset classes and geographies in order to achieve a truly diversified portfolio. Our Recommended Funds list comprises many skilled fund managers who take an active investment approach across a diverse range of asset classes. In August, we also produced our Top 25 Best of British Fund Managers list, which demonstrated that there are good active managers out there who are outperforming their benchmarks and peer groups.

It should also be noted that looking at performance numbers from one quarter is really just a snapshot. It is essential to consider these figures in the context of investing with long-term goals in mind.

Long term performance

All but two of the 54 funds in our Recommended Funds list with a five-year track record have delivered a positive absolute return over the last five years. Over the same time frame the FTSE All Share index returned 68.9%, a figure beaten by 32 of these funds across a broad range of asset classes.

The top performer over five years to 30 September 2016 is Schroder US Mid Cap, which returned 153.9%. Other funds which posted strong performance over the same period include Liontrust UK Smaller Companies, Old Mutual North American Equity, HSBC American Index, JPM US Equity Income, Henderson Global Technology, Artemis Global Income, Baillie Gifford International, Royal London UK Equity Income, Franklin UK Mid Cap, BlackRock Global Property Securities Equity Tracker, First State Global Listed Infrastructure, Royal London Sustainable Leaders, Veritas Asian, Invesco Perpetual Global Smaller Companies and Henderson European Selected Opportunities. All these funds would have more than doubled your investment over the last five years.

While US funds fill four of the top five positions, reflecting a significant rise in the S&P 500 index over the last five years, there has also been strong performance from UK, European and global equity funds, in addition to specialist funds focusing on areas such as sustainability, infrastructure, technology and property.

The two funds which are in negative territory over five years, First State Global Resources and BlackRock Gold & General, are commodity-focused and have suffered from the downturn in prices in those sectors. Year-to-date, however, these two funds are at the top of the performance charts, reflecting the change in fortune for these parts of the market.

TD Recommended Funds Performance Q3

For comparison purposes, over the same period the FTSE All Share returned 7.8%


Past performance is not a reliable indicator of future results
Source: Morningstar Direct as at 30 September 2016.

TD Recommended Funds Performance over five years

For comparison purposes, over the same period the FTSE All Share returned 68.9%


Past performance is not a reliable indicator of future results
Source: Morningstar Direct as at 30 September 2016.

TD Recommended Funds Performance YTD

For comparison purposes, over the same period the FTSE All Share returned 12.4%


Past performance is not a reliable indicator of future results
Source: Morningstar Direct as at 30 September 2016.

View our TD Recommended Funds list

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Investors should be aware that the value of investments can fall as well as rise, you may get back less than you invested. If you are unsure about the suitability of a particular investment you should speak to a suitably qualified financial adviser.