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February 10, 2015

Lipper Fund Awards 2015–A night to remember in Zurich

by Detlef Glow

THOMSON REUTERS/MORITZ HAGER

THOMSON REUTERS/MORITZ HAGER

On February 3 around 200 participants from the Swiss and international fund industries celebrated the twenty-sixth annual Lipper Fund Awards for Switzerland. This awards event is the kick-off every year for Lipper’s global awards program. Since this event also marks the beginning of the annual Swiss awards season, it gets a lot of attention from the asset management industry as well as from the media.

Among the guests showing the importance of the Lipper Fund Awards in Switzerland was Mr. Andreas Köster, Managing Director and Head of Asset Allocation & Currency at UBS AG in Zurich; he collected one of the prestigious trophies for UBS (Lux) KSS-Global Allocation (CHF) P-acc. While our guests enjoyed live music and food after the awards ceremony, the two Lipper media partners—BANCO and e-fundresearch—published the first pictures and results from the ceremony. In addition to the media coverage there was also a live Twitter feed #LFACH15 from the event.

Andreas Köster (UBS)/Otto C. Kober (Lipper) Picture: THOMSON REUTERS/MORITZ HAGER

Andreas Köster (UBS)/Otto C. Kober (Lipper)
Picture: THOMSON REUTERS/MORITZ HAGER

Different methodologies lead to different results

Contrary to what a number of market observers would expect, the Lipper Fund Awards are not based only on return numbers; the winners of a Lipper Fund Award aren’t determined by looking at the funds with the highest returns over the respective awards periods. In actuality, the Lipper Fund Awards are based on the Lipper Leader ratings for Consistent Return; they are calculated using a utility function based on the effective return over multiple non-overlapping periods—three-, five-, and ten-year horizons. The calculations over multiple periods ensure that all periods in which a fund underperforms the average of its peer group are identified. Then, Lipper uses a utility function based on behavioural finance theory to penalize periods of underperfomance against the peer group average, with more significant weightings being given to excess negative returns.

From an investor point of view the calculation methodology ensures that the winners of the Lipper Fund Awards are funds that have provided relatively superior consistency and risk-adjusted returns compared to a group of similar funds. Therefore, funds that receive a Lipper Fund Award may be the best fit for investors who value a fund’s year-to-year consistency relative to other funds in a particular peer group.

THOMSON REUTERS/MORITZ HAGER

THOMSON REUTERS/MORITZ HAGER

The best mutual funds in Switzerland

The Lipper Fund Awards ceremony in Zurich honored 20 single funds from the largest peer groups in the Swiss fund universe by assets under management. In addition, there were 67 funds that won an award for the three-year period, although they didn’t receive a trophy on stage. Also, 73 funds were recognized with a Lipper Fund Award over the five-year period, and 45 funds won the prestigious trophy for the ten-year period.

Equity Switzerland

Credit Suisse Select (CH) Swiss Equities 130/30 B once again won the Lipper Fund Award for the Equity Switzerland category over the three- and five-year periods, while Raiffeisen Futura Swiss Stock A won for the ten-year period.

Marcel Schibli (Fund ManagerCredit Suisse Select (CH) Swiss Equities 130/30 B)/Otto C. Kober (Lipper) THOMSON REUTERS/MORITZ HAGER)

Marcel Schibli (Fund Manager Credit Suisse Select (CH) Swiss Equities 130/30 B)/Otto C. Kober (Lipper)
THOMSON REUTERS/MORITZ HAGER)

Equity Switzerland Small- and Mid-Cap

Pictet CH-Swiss Mid Small Cap-P dy CHF was named the Lipper Fund Award winner for Equity Switzerland Small- and Mid-Cap over the three-year period, while BGF Swiss Small & MidCap Opp A2 CHF won over the five-year period, and Mirabaud-Equities Swiss Small and Mid-A Cap-CHF won for the ten-year period.

The best asset management groups in Switzerland

The group awards are divided into large and small management groups, based on a regional assets-under-management split. It is not enough for a fund management company to hold just one large fund. A large management group must have at least five equity, five bond, and three mixed-asset portfolios, while a small group must have at least three equity, three bond, and three mixed-asset portfolios.

Within the bond segment the best small asset manager was Banca del Sempione from Switzerland, which outperformed 33 competitors in this category. The best large bond fund manager was BlackRock, which beat 50 competitors in its category.

The London-based Charlemagne Capital outperformed its 88 opponents and was named the best small asset manager in the equity segment. The Scottish Standard Life Investments won the trophy as the best large asset manager of equity funds, beating 61 competitors in terms of consistent outperformance.

There were 24 large and 31 small asset managers competing for the Lipper Fund Awards in the mixed-asset segment. While the Danish Jyske Invest won the trophy for the best small manager, the award for the best large manager went to the U.S.-based asset manager Franklin Templeton Investments.

The highlight of the evening was the presentation of the overall awards. The winning groups were able to show an above-average risk-adjusted performance within their bond, equity, and mixed-asset products. In this category there were 21 large and 11 small groups competing for the prestigious trophy. For the mixed-asset category Jyske Invest once again won the award for the best small fund management group, while BlackRock was named the best large fund management group.

As one can see from the number of fund management groups in the single categories, the Lipper Fund Awards are notoriously competitive and recognize the fund managers that are setting benchmarks within the industry. The Awards commemorate the expertise of the collective funds management industry and the individual funds’ ability to outperform the market.

THOMSON REUTERS/MORITZ HAGER

THOMSON REUTERS/MORITZ HAGER

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