For almost two decades, Bestinvest has campaigned to raise awareness of poor fund performance by shining a spotlight on those funds that are amongst the worst performers through our landmark Spot the Dog guide.
The financial services industry has earned an unfortunate reputation for over promising and under delivering. Investment funds are heavily promoted during periods when they are riding high in the performance tables but the reality is that over the long term most funds fail to beat their benchmarks. In many cases this is because the manager’s decisions have not added value and/or because the costs are too high. Yet surprisingly many investors put up with weak or pedestrian performance by either not monitoring their investments regularly, receiving poor service from the adviser who originally recommended the investments or through simple inertia.
Our Spot the Dog report is widely recognised as the UK’s definitive guide that names and shames those funds that have consistently and significantly underperformed, so unsurprisingly it doesn’t win any popularity awards from fund managers.
The latest edition of Spot the Dog has identified 59 unit trusts and OEIC funds that have consistently under performed in each of the last three years and by 10% or more over three years. These funds collectively represent £13.3 billion of investors’ cash.
Unfortunately, Spot the Dog represents the tip of the iceberg in terms of funds that disappoint as the filters we have applied are designed to focus on the very ‘worst of the worst.’ For every fund highlighted in this report, there are many more that are also underachieving.
Whether or not you hold any funds that appear in Spot the Dog, if you are concerned about your investments and are not currently a client of Bestinvest, our Free Investment Report Service & Tool (First) can help you analyse your portfolio.