Our fund recommendations are drawn from the whole of the market and selected using a two pronged approach with Morningstar's analyst team providing unbiased in depth research that is analysed by our own Investment Team. We also carry out our own research and all recommendations are presented and approved by TD Direct Investing's Investment Committee.
As a result of our collaborative research we have introduced a number of new funds to the list. The new funds are intended to offer more variety in popular asset classes such as UK equities, as well as international income funds delivering further diversification benefits.
Two new UK equity funds have been added to our Recommended Funds list.
Added as a replacement for CF Woodford Equity Income. Fund manager Richard Colwill uses a flexible investment process combining top-down and bottom-up disciplines. Fund performance has historically been strong through the cycle. The combination of manager experience, pragmatism, market awareness and a focus on total return make this a strong fund for those seeking exposure to UK equity income.
Managed by Mark Slater, co-founder of Slater Investments. The fund typically has a small-cap bias and has strongly outperformed both its benchmark and peer group over many years. Slater has a consistent bottom-up conviction led approach to stock selection, resulting in a concentrated portfolio of 25 to 40 stocks. Stock selection drives returns and has been strong over both three and five-year periods. The fund's unconstrained and concentrated growth orientated approach offers TD customers a differentiated offering in terms of style.
Two funds have been added to our TD Recommended List as replacements for Newton Global Income.
Artemis Global Income is mainly invested in the developed markets and adopts a balanced approach to growth and income. Its top-down macroeconomic overlay differentiates the fund and has contributed to the fund's consistent outperformance. Fund manager Jacob de Tusch-Lec's approach has led to significant investment in growth sectors such as technology and consumer discretionary. Conversely, the fund is underweight in oil and materials.
Veritas Global Equity Income we feel is a good option for investors seeking an out-of-favour value fund. Managers Andy Headley and Charles Richardson are theme-based value investors with a highly focused portfolio of well-researched shares. It has a bias towards the UK (less US focused) and healthcare stocks. As it shuns the consumer discretionary sector and the US, it has missed some of the growth returns of late. However, we feel it is well positioned to perform well in the medium to long term.
Although the fund has performed exceptionally well since inception, we note that Woodford's performance has reached a pinnacle recently and like all managers, Woodford cannot outperform all the time. The fund has grown significantly and is now £8.3 billion. Together with the other funds run by Woodford the firm's assets are over £12 billion. We believe there comes a point when the size of the fund hampers the manager's ability to react, trade and ultimately continue outperforming. Also, the Investment Association have indicated that they may remove the fund from the IA UK Equity Income sector because the yield is falling short of the sector's requirements.
Newton Global Income fund manager James Harries had run the fund since 2005 but he recently stepped down and left the company in December. As a result, Morningstar changed the fund's Analyst Rating from Silver to Under Review. As Harries' own investment style was a key characteristic of the fund, we have decided to remove it from our Recommended Funds.
Manager Richard Peirson has handed over management of the UK equities and fixed income portions of the fund. Overseas equities continue to be managed by AXA Framlington's regional teams, leaving Peirson with overall responsibility for asset allocation and fund cash flows. The fixed income mandate, which will be run by Nick Hayes, has been widened to include investment grade corporate bonds. Jamie Hooper was given responsibility for the UK equities portion in November 2015. As a result of these changes we have decided to remove the fund from our TD Recommended Funds list.
Not got an account yet.?
You can apply for an account online by clicking on the 'Choose an account' button.