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March 19, 2018

A Sparkling London Evening: U.K. Lipper Fund Awards 2018

by Jake Moeller.

The 28th annual U.K. Lipper Fund Awards event was held at the elegant Banking Hall on March 14, 2018. A full house of 200 participants from the U.K. and international fund management industries created an exciting buzz ahead of the industry’s premier night of recognizing excellence in fund management.

The event was followed on Twitter with many members of the audience sharing their views via the hashtag #LipperFundAwards.

A full house at the Banking Hall ensured a great atmosphere. Photo, Refinitiv.

Setting the scene: 2017 – a good year for fund flows

Jake Moeller, Head of Lipper UK & Ireland Research at Refinitiv was the emcee for the evening. He set the scene with a keynote presentation revealing that even in the light of considerable regulatory initiatives, the Pan-European mutual funds industry was in robust health.

In 2017 the industry had passed the €1 trillion of assets under management with record net inflows of nearly €800 billion.

Jake Moeller

Jake Moeller highlights a Pan-European fund flow record and regulatory challenges. Photo, Refinitiv.

Jake also noted that only 12% of total Pan-European AUM was in passive vehicles and that the long-term average of net flows into passive vehicles since 2004 was around 10%. Despite a high of nearly 30% of flows in 2015 being in passive vehicles, this figure in 2017 had fallen back toward the long-term average.

He also examined the concentration of funds in the UK market noting that the top 100 funds contained 40% of assets in this market. He highlighted that none of the evening’s single-asset class winners were in these top 100 funds by AUM. He also highlighted the potential opportunity for active fund managers in a late cycle environment. Using the Eikon Fund Share Holdings report, he showed that for the largest 20 fund shareholders of HSBC, 15 were passive vehicles.

Guest Speaker – Matt Dawson

In an entertaining speech, former England rugby captain, scrum-half and key member of the winning 2003 World Cup team, Matt Dawson spoke on leadership, teamwork and how he has adapted the lessons of his sporting career into other fields.

Former England Rugby captain, Matt Dawson. Photo, Refinitiv.

Matt also outlined the important work of Great Ormond Street Hospital – the represented charity for the evening.

What does it takes to win?

In an onstage chat with Jake Moeller, Doug Sieg, the imminent CEO of Lord, Abbett & Co (the winner of the Bond Small Group Award), outlined some of the key factors contributing to its Award success.

Lord, Abbett & Co’s Doug Sieg, on stage. Photo, Refinitiv.

Doug discussed the attraction of the Pan-European fund market to U.S.-based firms and recognised that attracting and retaining talented staff was a key component for competing against more established European names. He also emphasised the importance of long-term thinking in order to be successful in this competitive market.

Lipper Fund Awards methodology

Lipper Fund Awards are based on the Lipper Leader ratings for Consistent Return. The awards 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.

In addition, Lipper uses a utility function based on behavioural finance theory to penalize periods of underperformance, with more significant weightings given to excess negative returns. This methodology ensures that the winners of the Lipper Fund Awards are funds that have provided superior consistency and relative risk-adjusted returns compared to a group of similar funds.

The winning mutual funds in the U.K.

Twenty single funds from the largest peer groups by assets under management in the U.K. fund universe were honoured for the three-year category during the ceremony.

Marlborough Fund Managers was well represented this year collecting the Equity Europe ex UK category winner with Marlborough European Multi-Cap A Inc. It also collected the gong for the Equity UK category with its third party MFM Bowland fund.

The team from Yuki Funds flew in from Japan to collect its first UK Lipper Fund Award.

First time winners in the UK this year included Yuki Funds which collected the Japan category for Yuki Japan Rebounding Growth and EFG which collected the Bond Global category with New Capital Wealthy Nations Bd USD Ord Acc.

The popular Equity UK Income category was collected by TB Evenlode Income B and Sielern made another appearance this year winning the Equity US category with Stryx America USD.

A full list of winners can be found here.

The group awards

For the prestigious group awards a large group must have at least five equity, five bond, and three mixed-asset portfolios, and a small group must have at least three equity, three bond, and three mixed-asset portfolios.

Exhibit 1. Group award winners and commendations

A new face this year was Danish fund manager Sparinvest who won the Equity Small Group category. Baillie Gifford who also picked up a single fund award picked up the Equity Large Group Award and Marlborough Fund Managers which having already collected the two single fund awards mentioned above, won the Overall Small Group award.

RLAM had a very successful evening. Phil Reid (c) collected the Large Group Overall Award.

The big winners of the evening were Royal London Asset Management who not only collected a single fund award but won two group awards for Mixed Assets Large Group and the coveted Overall Large Group.

Lipper takes this opportunity to congratulate all the individual sector and group award winners. A full photo gallery of the event is available here and we look forward to seeing you all again for another successful evening night in 2019.

Bankers Hall in the City of London, proved a popular venue. Photo, Refinitiv.

Lipper delivers data on more than 265,000 collective investments in 61 countries. Find out more.

This material is provided for as market commentary and for educational purposes only and does not constitute investment research or advice. Refinitiv cannot be held responsible for any direct or incidental loss resulting from applying any of the information provided in this publication or from any other source mentioned. Please consult with a qualified professional for financial advice. 

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