by Detlef Glow.
On February 26, around 150 participants from the Swiss and international fund industries celebrated the thirty-first annual Lipper Fund Awards for Switzerland at the Park Hyatt Hotel in Zurich. This awards event is the annual kick-off for Lipper’s global awards program. Since the event also marks the beginning of the annual Swiss awards season, it gets a lot of attention from the asset management industry.
The speakers at the event were Leon J. Saunders Calvert, Head of Sustainable Investing & Lipper Fund Analytics at Refinitiv, and Detlef Glow, Head of Lipper EMEA Research at Refinitiv. Both provided market insights and much food for thought to the attendees during their presentations.
Our guests were involved in interesting conversations with their peers while they enjoyed the networking, accompanied by drinks and food, after the awards ceremony. The event was covered by Fundplat, Lipper’s awards media partner in Switzerland.
Different methodologies lead to different results
Contrary to what a number of market observers would expect, the Refinitiv Lipper Fund Awards are not based on return numbers alone—the winners of a Refinitiv Lipper Fund Award aren’t determined by looking at the funds with the highest returns over the respective awards periods. In actuality, the Refinitiv Lipper Fund Awards are based on the Lipper Leader rating for Consistent Return. These ratings are calculated using a utility function based on the effective return over multiple non-overlapping periods—within the respective three-, five-, and 10-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 behavioral 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 Refinitiv 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 Refinitiv 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.
The best mutual funds in Switzerland
The Refinitiv 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 79 funds that won an award for the three-year period, although they didn’t receive a trophy on stage. Also, 90 funds were recognized with a Lipper Fund Award over the five-year period, and 66 funds won the prestigious trophy for the 10-year period.
CS (CH) 130/30 Swiss Equity Fund B CHF won the Lipper Fund Award for the Equity Switzerland category over the three- and five-year periods, while PS CH-Swiss High Dividend-P CHF won for the 10-year period.
Refinitiv Lipper Fund Awards 2020 at the Park Hyatt in Zurich, Switzerland, February 26th, 2020. Foto: Moritz HagerEquity Switzerland Small- and Mid-Cap
BGF Swiss Small & MidCap Opp A2 CHF was named the Lipper Fund Award winner for Equity Swiss Small- and Mid-Cap over the three-, five-, and 10-year periods.
The best asset management groups in Switzerland
The group awards are divided into those for 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 once again Lord, Abbett & Co, which outperformed 39 competitors in this category. The best large bond fund manager was once again MFS, which beat 62 competitors in its category.
Seilern outperformed its 92 opponents and was named the best small asset manager in the equity segment. Columbia Threadneedle Investments won the trophy as the best large asset manager of equity funds, beating 72 competitors in terms of consistent outperformance.
There were 47 large asset managers and 41 small asset managers competing for the Lipper Fund Awards in the mixed-asset segment. While the Swiss Basler Kantonalbank won the trophy for the best small manager, the award for the best large manager went to the German asset manager Flossbach von Storch.
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 37 large groups and 18 small groups competing for the prestigious trophy. The Swiss asset manager Raiffeisen Schweiz won the award for the best small fund management group, while MFS was once again 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 exceedingly competitive and recognize the fund managers that are setting benchmarks within the industry. The Awards commemorate the expertise of the collective fund management industry and the individual funds’ ability to outperform the market.