Dynamic Fund Selection

Within FundExpert.co.uk you will see that each fund has a rating, from 1 Star to 5 Star. This is a neat tool for investors seeking growth (click here if you are an income investor).

The rating tells you if a fund should be bought (or sold). For example, in theory a 5 Star rating means a high probability of extra growth compared to average. Moving beyond theory, the sector links below show you how successful it has been in practice, back to the 1990s.

We call our ratings system Dynamic Fund Selection, which is based on a type of momentum investing. Momentum investing at its simplest means buying an investment (in this case a fund) which is already performing well on the likelihood that it will continue to perform well. There is lots more explanation here DYNAMIC FUND SELECTION - how and why our ratings work

Dynamic Fund Selection - by sector

We tested our Dynamic Fund Selection sector by sector. Click on a sector below to see how much more growth you could have generated since the 1990s.

UK All Companies

UK All Companies funds invest at least 80% of their assets in UK equities which have a primary objective of achieving capital growth.

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the UK All Companies sector, analysing 204 five year periods since 1994. The results:

  • 7.85% extra growth per annum - achieved by the Dynamic Fund Selection vs the average sector fund
  • £4,592 average extra return after 5 years – from an £10,000 initial investment
  • 92.16% chance of outperformance - Dynamic Fund Selection outperformed in 188/204 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1994. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best UK All Companies momentum funds here

 

UK All Companies - Dynamic Fund Selection vs. Sector Average since 1994

 

Annual performance over the past 5 years

 

Time Period

0-12

Months

12-24

Months

24-36

Months

36-48

Months

48-60

Months

5 Years Overall
Dynamic Fund Selection -9.00 20.46 21.96 32.19 -4.49 68.80
Sector Average -2.62 7.01 13.92 22.98 -5.79 37.55

(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)

 

UK Equity Income

UK Equity Income funds invest at least 80% of their assets in UK equities which intend to achieve a historic yield in excess of 110% of the FTSE All Share yield. 

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the UK Equity Income sector, analysing 204 five year periods since 1994. The results:

  • 4.59% extra growth per annum - achieved by the Dynamic Fund Selection vs the average sector fund
  • £2,517 average extra return after 5 years – from an £10,000 initial investment
  • 96.08% chance of outperformance - Dynamic Fund Selection outperformed in 196/204 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1994. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best UK Equity Income momentum funds here

 

UK Equity Income - Dynamic Fund Selection vs. Sector Average since 1994

 

Annual performance over the last 5 years

 

Time Period

0-12

Months

12-24

Months

24-36

Months

36-48

Months

48-60

Months

5 Years Overall
Dynamic Fund Selection 4.39 9.14 17.22 31.74 -12.13 54.60
Sector Average -0.28 7.00 14.22 21.90 -2.22 45.26

(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)

 

UK Smaller Companies

UK Smaller Companies funds invest at least 80% of their assets in equities of UK companies which form the bottom 10% by market capitalisation.

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the UK Smaller Companies, analysing 204 five year periods since 1994. The results:

  • 11.08% extra growth per annum - achieved by the Dynamic Fund Selection vs the average sector fund
  • £6,909 average extra return after 5 years – from an £10,000 initial investment
  • 91.18% chance of outperformance - Dynamic Fund Selection outperformed in 186/204 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1994. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best UK Smaller Companies momentum funds here

 

UK Smaller Companies - Dynamic Fund Selection vs. Sector Average since 1994

 

Annual performance over the last 5 years

Time Period 0-12 Months 12-24 Months 24-36 Months 36-48 Months 48-60 Months 5 Years Overall
Dynamic Fund Selection -6.75 8.98 27.75 37.82 -6.55 67.21
Sector Average -5.49 9.87 22.19 26.97 -6.82 50.10

(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)

 

Europe excluding UK

Europe ex-UK funds invest at least 80% of their assets in European equities and exclude UK securities.

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the Europe ex-UK sector, analysing 204 five year periods since 1994. The results:

  • 6.23% extra growth per annum - achieved by the Dynamic Fund Selection vs the average sector fund
  • £3,528 average extra return after 5 years – from an £10,000 initial investment
  • 97.06% chance of outperformance - Dynamic Fund Selection outperformed in 198/204 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1994. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best Europe ex-UK momentum funds here

 

Europe ex-UK - Dynamic Fund Selection vs. Sector Average since 1994

 

Annual performance over the last 5 years

 

Time Period

0-12

Months

12-24

Months

24-36

Months

36-48

Months

48-60

Months

5 Years Overall
Dynamic Fund Selection 11.32 23.95 15.84 31.69 -22.01 64.16
Sector Average 6.19 4.62 13.68 32.04 -19.45 34.32

(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)

 

Global Growth

Global Growth funds invest at least 80% of their assets globally in equities. Funds must be diversified by geographic region. 

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the Global Growth sector, analysing 204 five year periods since 1994. The results:

  • 8.51% extra growth per annum - achieved by the Dynamic Fund Selection vs the average Global fund
  • £5,042 average extra return after 5 years – from an £10,000 initial investment
  • 89.71% chance of outperformance - Dynamic Fund Selection outperformed in 183/204 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1994. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best Global Growth momentum funds here

 

Global Growth - Dynamic Fund Selection vs. Sector Average since 1994

 

Annual performance over the last 5 years

Time Period

0-12

Months

12-24

Months

24-36

Months

36-48

Months

48-60

Months

5 Years Overall
Dynamic Fund Selection 13.12 6.01 8.84 25.96 -0.20 64.08
Sector Average 8.70 8.89 8.58 21.79 -8.19 43.70

(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)

 

Global Emerging Markets 

Global Emerging Markets funds invest at least 80% of their assets in emerging market equities.

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the Global Emerging Markets sector, analysing 176 five year periods since 1996. The results:

  • 2.77% extra growth per annum - achieved by the Dynamic Fund Selection vs the average sector fund
  • £1,462 average extra return after 5 years – from an £10,000 initial investment
  • 75.57% chance of outperformance - Dynamic Fund Selection outperformed in 133/176 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1996. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best Global Emerging Markets momentum funds here

 

Global Emerging Markets - Dynamic Fund Selection vs. Sector Average since 1996

 

Annual performance over the last 5 years

 

Time Period

0-12

Months

12-24

Months

24-36

Months

36-48

Months

48-60

Months

5 Years Overall
Dynamic Fund Selection 1.09 -2.65 2.73 14.33 -9.35 4.78
Sector Average 5.12 2.28 0.86 7.76 -14.40 0.03


(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)

 

Asia-Pacific ex-Japan

Asia Pacific Excluding Japan funds invest at least 80% of their assets in Asia Pacific equities and exclude Japanese equities.

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the Asia Pacific Excluding Japan sector, analysing 200 five year periods since 1994. The results:

  • 1.13% extra growth per annum - achieved by the Dynamic Fund Selection vs the average sector fund
  • £579 average extra return after 5 years – from an £10,000 initial investment
  • 67.50% chance of outperformance - Dynamic Fund Selection outperformed in 135/200 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1994. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best Asia-Pacific ex-Japan momentum funds here

 

Asia-Pacific ex-Japan - Dynamic Fund Selection vs. Sector Average since 1994

 

Annual performance over the past 5 years

Time Period

0-12

Months

12-24

Months

24-36

Months

36-48

Months

48-60

Months

5 Years Overall
Dynamic Fund Selection 4.39 18.18 4.70 14.56 -1.13 46.32
Sector Average 6.52 9.90 3.20 13.37 -11.8 20.80

(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)

 

Japan 

Japan funds invest at least 80% of their assets in Japanese equities.

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the Japan sector, analysing 192 five year periods since 1995. The results:

  • 6.04% extra growth per annum - achieved by the Dynamic Fund Selection vs the average sector fund
  • £3,410 average extra return after 5 years – from an £10,000 initial investment
  • 96.88% chance of outperformance - Dynamic Fund Selection outperformed in 186/192 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1995. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best Japan momentum funds here

 

Japan - Dynamic Fund Selection vs. Sector Average since 1995

 

Annual performance over the last 5 years

Time Period

0-12

Months

12-24

Months

24-36

Months

36-48

Months

48-60

Months

5 Years Overall
Dynamic Fund Selection 36.13 18.70 -3.04 48.27 -0.80 130.44
Sector Average 8.61 17.62 -2.14 26.57 -4.38 51.29

(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)

 

North America

North America funds invest at least 80% of their assets in North American Equities.

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the North America sector, analysing 192 five year periods since 1995. The results:

  • 6.06% extra growth per annum - achieved by the Dynamic Fund Selection vs the average sector fund
  • £3,420 average extra return after 5 years – from an £10,000 initial investment
  • 73.96% chance of outperformance - Dynamic Fund Selection outperformed in 142/192 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1995. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best North American momentum funds here

 

North America - Dynamic Fund Selection vs. Sector Average since 1995

 

Annual performance over the last 5 years

Time Period

0-12

Months

12-24

Months

24-36

Months

36-48

Months

48-60

Months

5 Years Overall
Dynamic Fund Selection 12.99 15.33 6.06 23.58 -1.68 67.92
Sector Average 14.96 16.10 10.07 24.89 0.77 84.86

(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)

 

Sterling Corporate Bond

Sterling Corporate Bond funds invest at least 80% of their assets in Sterling denominated corporate bond securities, rated Triple B minus or above.

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the Sterling Corporate Bond sector, analysing 184 five year periods since 1996. The results:

  • 1.78% extra growth per annum - achieved by the Dynamic Fund Selection vs the average sector fund
  • £921 average extra return after 5 years – from an £10,000 initial investment
  • 91.85% chance of outperformance - Dynamic Fund Selection outperformed in 169/184 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1996. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best Sterling Corporate Bond momentum funds here

 

Sterling Corporate Bond - Dynamic Fund Selection vs. Sector Average since 1996

 

Annual performance over the last 5 years

Time Period

0-12

Months

12-24

Months

24-36

Months

36-48

Months

48-60

Months

5 Years Overall
Dynamic Fund Selection 11.17 3.41 7.72 9.90 3.04 40.22
Sector Average 7.62 4.22 6.45 6.49 6.16 34.96

(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)

 

Sterling Strategic Bond

Sterling Strategic Bond funds invest at least 80% of their assets in sterling denominated fixed income securities. 

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the Sterling Strategic Bond sector, analysing 146 five year periods since 1999. The results:

  • 3.10% extra growth per annum - achieved by the Dynamic Fund Selection vs the average sector fund
  • £1,649 average extra return after 5 years – from an £10,000 initial investment
  • 93.84% chance of outperformance - Dynamic Fund Selection outperformed in 137/146 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1999. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best Sterling Strategic Bond momentum funds here

 

Sterling Strategic Bond - Dynamic Fund Selection vs. Sector Average since 1999

 

Annual performance over the last 5 years

Time Period

0-12

Months

12-24

Months

24-36

Months

36-48

Months

48-60

Months

5 Years Overall
Dynamic Fund Selection 5.16 -2.61 10.07 15.11 0.07 29.84
Sector Average 3.60 2.39 7.70 7.20 5.07 28.69

(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)

Flexible Investment

The funds in this sector are expected to have a range of different investments. However, the fund manager has significant flexibility over what to invest in. There is no minimum or maximum requirement for investment in company shares (equities) and there is scope for funds to have a high proportion of shares. 

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the Flexible Investment sector, analysing 192 five year periods since 1995. The results:

  • 3.86% extra growth per annum - achieved by the Dynamic Fund Selection vs the average sector fund
  • £2,087 average extra return after 5 years – from an £10,000 initial investment
  • 88.54% chance of outperformance - Dynamic Fund Selection outperformed in 170/192 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1995. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best Flexible Investment momentum funds here

 

Flexible Investment - Dynamic Fund Selection vs. Sector Average since 1995

 

Annual performance over the last 5 years

Time Period

0-12

Months

12-24

Months

24-36

Months

36-48

Months

48-60

Months

5 Years Overall
Dynamic Fund Selection 5.54 8.22 12.06 21.57 -11.74 37.34
Sector Average 2.45 7.12 7.38 15.78 -6.85 27.09

(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)

Mixed 20-60% Shares

Funds in this sector are required to have a range of different investments. The fund must have between 20% and 60% invested in company shares (equities). At least 30% of the fund must be in fixed income investments (for example, corporate and Government bonds) and/or “cash” investments.  “Cash” can include investments such as current account cash, short-term fixed income investments and certificates of deposit.

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the Mixed 20-60% Shares sector, analysing 183 five year periods since 1996. The results:

  • 3.04% extra growth per annum - achieved by the Dynamic Fund Selection vs the average sector fund
  • £1,617 average extra return after 5 years – from an £10,000 initial investment
  • 91.80% chance of outperformance - Dynamic Fund Selection outperformed in 168/183 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1996. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best Mixed 20-60% Shares momentum funds here

 

Mixed 20-60% Shares - Dynamic Fund Selection vs. Sector Average since 1996

 

Annual performance over the last 5 years

Time Period

0-12

Months

12-24

Months

24-36

Months

36-48

Months

48-60

Months

5 Years Overall
Dynamic Fund Selection 3.68 5.26 7.81 18.20 -1.20 37.40
Sector Average 3.03 4.66 6.75 10.43 -1.15 25.65

(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)

Mixed 40-85% Shares

Funds in this sector are required to have a range of different investments. However, there is scope for funds to have a high proportion in company shares (equities). The fund must have between 40% and 85% invested in company shares. 

 

How effective is Dynamic Fund Selection in this sector?

We tested the effectiveness of Dynamic Fund Selection within the Mixed 40-85% Shares sector, analysing 192 five year periods since 1995. The results:

  • 4.83% extra growth per annum - achieved by the Dynamic Fund Selection vs the average sector fund
  • £2,658 average extra return after 5 years – from an £10,000 initial investment
  • 92.19% chance of outperformance - Dynamic Fund Selection outperformed in 177/192 five year periods 

This is illustrated in the chart below. The blue columns represent the return of Dynamic Funds Selection for each five year period since 1995. The red line represents the sector average. Wherever the blue column is higher than the red line Dynamic Fund Selection outperformed the sector average.  

 

Find the best Mixed 40-85% Shares momentum funds here

 

Mixed 40-85% Shares - Dynamic Fund Selection vs. Sector Average since 1995

 

Annual performance over the last 5 years

Time Period

0-12

Months

12-24

Months

24-36

Months

36-48

Months

48-60

Months

5 Years Overall
Dynamic Fund Selection 1.61 4.94 7.77 22.36 -1.76 38.13
Sector Average 3.21 6.83 7.81 15.49 -4.18 31.55

(all figures as at 1 July 2016 based on independent fund data sourced from Financial Express Analytics)