TD Recommended Funds performance

Q2 2016 Performance Summary

After a difficult first quarter markets made up some ground over the second quarter, led higher by oil and energy. Volatility remained, though, and this further intensified both pre and post EU Referendum in late June. All markets were in positive territory over the quarter, with the Brent Crude oil price up 34.9% and other notable performances coming from gold and healthcare. The FTSE All Share index gained 4.7% over the period.

Our Recommended Funds list delivered solid performance during the quarter, with 46 of the 61 funds managing a positive return. BlackRock Gold & General, First State Global Resources and Guinness Global Energy continued their strong performance from the first quarter and were the top three performing funds. Other funds which rose significantly were spread across global equities, infrastructure, Asian equities, US equities and property.

Recent addition Polar Capital Global Insurance returned 9.2%, highlighting the appeal of diversifying into specialist sector funds.

Underperforming funds over the quarter included a number of those focusing on UK small and mid-cap stocks, which were left behind by their larger-cap counterparts as investors sought a “flight to safety” both pre and post the EU Referendum. As in the previous quarter, absolute return funds struggled in the shape of Kames UK Equity Absolute Return, H2O MultiReturns and Henderson UK Absolute Return.

We continue to stress the importance of investing across different geographies and asset classes in order to achieve a truly diversified portfolio. Within our Recommended Funds list we have selected many skilled fund managers who take an active investment approach across a diverse range of asset classes.

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

51 of the 55 funds in our Recommended Funds list with a five-year track record delivered a positive absolute return over that period. Over the same time frame the FTSE All Share index returned 35.5%. 33 of these funds, spread across a broad range of asset classes, outperformed the UK index, demonstrating the true power of diversification.

The best performing fund over five years to 30 June 2016 is Old Mutual North American Equity, which returned 110.8% over the five-year period. Other stand out funds in terms of five-year performance are JPM US Equity Income, HSBC American Index, Liontrust UK Smaller Companies, Schroder US Mid Cap, Henderson Global Technology, First State Global Listed Infrastructure, Royal London UK Equity Income, Baring Europe Select, Artemis Global Income and BlackRock Global Property Securities Equity Tracker. All these funds delivered a return in excess of 70% over the period.

While US funds filled the top three 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.

Of the four funds with a five-year track record which are in negative territory, three are energy or commodity-focused funds which, at least until this year, have suffered from the downturn in prices in those sectors. This year these sectors have been the top performers, showing the importance of focusing on a long-term strategy and not being led by recent performance.

TD Recommended Funds Performance Q2

For comparison purposes, over the same period the FTSE All Share returned 4.7%


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

TD Recommended Funds Performance over five years

For comparison purposes, over the same period the FTSE All Share returned 35.5%


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

TD Recommended Funds Performance YTD

For comparison purposes, over the same period the FTSE All Share returned 4.3%


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

View our TD Recommended Funds list

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