Multi-managers have their uses

Whether you love them or hate them, multi-manager funds can provide canny investors with a wealth of information

This is because most multi-managers are free to select the funds they want from the whole range available and are not restricted to just one investment stable. So by examining the selections made by several different multi-managers, investors can get a pretty good picture of which funds the experts favour and which they don’t like.
Lipper Fitzrovia, the financial research company, has produced a list of the funds most frequently selected for multi-manager portfolios.
At the top of the list - and well ahead of the chasing pack - come Artemis European Growth fund and JPMorgan Japan fund. The Artemis fund has been a consistently good performer though it slipped a little in the past 12 months. The JPMorgan fund has a very highly regarded manager in David Mitchinson though his performance has not been spectacular in recent years.
The next five places are taken by another Artemis fund, the Income fund, followed by Neil Woodford’s Invesco Perpetual Income fund, JO Hambro UK Growth, Merrill Lynch UK Dynamic and AXA Framlington Equity Income.
These lists of most favoured funds are certainly worth looking at because to feature in them a fund must have gone through the sifting process of several different multimanagers and emerged on top, which is no small achievement.
But what is equally worth noting is the vast number of funds which do not make it onto a single multi-manager buy list.
John Chatfeild-Roberts, head of Jupiter’s multi-manager team, reckons that about 95 per cent of all funds fall into this category and that is a damning indictment of the poor quality of an awful lot of funds.