Smaller and mid-cap companies funds dominated the top 10 performing UK domiciled unit trusts and open-ended investment companies (Oeics) over 2012. The best performing fund of 2012 was UK All Companies fund Standard Life UK Equity Unconstrained (GB00B0LD3B90), posting an annual return of 44 per cent.
The fund has had a good run over the past few years since it has been run by Ed Leggett placing it among the top few funds in its sector over one, three and five years. Hot on its heels over 2012 is Fidelity UK Smaller Companies (GB00B3SW2T17), whose manager Alex Wright has recently also taken on management of Fidelity Special Values investment trust, a recent IC tip (read it here).
Other Smaller Companies funds in the top 10 are Cazenove UK Smaller Companies (GB0031092942), River & Mercantile UK Equity Smaller Companies (GB00B1DSZR91) and FF&P Small Cap UK Equity (GB00B67Z5152).
The high number of UK Smaller Companies funds in the top 10 reflects the fact that UK Smaller Companies was one of the best-performing fund sectors in 2012. "This sector still looks good value, it has momentum, and investors risk missing out on a renaissance of smaller companies which is being very profitably exploited by the better fund managers," comments Brian Dennehy, managing director of investing website Fundexpert.co.uk.
Top 10 performing funds in 2012
| Fund | Annual return 2012 (%) | Investment Management Association (IMA) Sector |
Standard Life UK Equity Unconstrained | 44.14 | UK All Companies |
Fidelity UK Smaller Companies | 41.63 | UK Smaller Companies |
Neptune UK Mid Cap | 40.85 | UK All Companies |
First State Asian Property Securities | 37.78 | Property |
Cazenove UK Smaller Companies | 37.35 | UK Smaller Companies |
River & Mercantile UK Equity Smaller Companies | 36.98 | UK Smaller Companies |
Thornhill Cap Trust | 36.68 | UK All Companies |
FF&P Small Cap UK Equity | 36.60 | UK Smaller Companies |
Schroder UK Mid 250 | 35.83 | UK All Companies |
Invesco Perpetual European High Yield | 35.72 | £ High Yield |
Source: Morningstar
Among investment companies, the top performer in 2012 was a venture capital trust (VCT), Oxford Technology. Specialist and esoteric funds from sectors such as private equity and securitised debt figured in the top ten though they also included more mainstream IC Top 100 Fund Acorn Income (AIF), which delivered 47.66 per cent. This seeks income from both UK listed small-caps and fixed interest, proving smallers can deliver income. This trust currently has an attractive yield of more than five per cent but can be picked up on a discount to net asset value (NAV) of more than 11 per cent. (read our tip)
Top 10 investment companies in 2012
Investment company | Annual Return 2012 (%) | Association of Investment Companies (AIC) Sector | |
| Oxford Technology VCT | 151.85 | VCT Specialist Technology | |
Economic Lifestyle Property | 96.33 | Property | |
LoudWater | 69.4 | Private Equity | |
Carador Income Fund | 54.2 | Sector Specialist: Securitised debt | |
Aberdeen New Thai | 52.64 | Country Specialist Asia Pacific | |
F&C Private Equity (Restricted Voting Ord) | 50.41 | Private Equity | |
New Europe Property Investment | 50.02 | Property Direct - Europe | |
Aberforth Geared Income | 47.66 | Split - Capital | |
Acorn Income Fund | 47.66 | Split - Capital | |
Real Estate Credit Investments | 45.31 | Sector Specialist: Securitised debt |
Source: Morningstar
