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May 8, 2020

U.K. Lipper Fund Awards 2020: We Will Meet Again

by Jake Moeller.

The 30th annual U.K. Lipper Fund Awards event had been due to take place at London’s elegant Banking Hall on March 18, 2020. However, the physical event was cancelled due to the unfolding Covid-19 crisis.

Despite the developing human drama, we should still recognize those funds which have produced strong risk-adjusted returns for their clients to the end of 2019.

This year’s awards have seen several new faces as well as a handful of repeat winners. It is great to see a blend of boutiques and established houses which are beating the drum for active funds management.

Setting the scene: mutual funds had a better year in 2019

2018 proved a tough year for mutual fund managers with estimated Pan-European net outflows of €129 billion. However, 2019 was more positive, with improved performance and Pan-European estimated net inflows of some €304 billion.

A concentrated market presents opportunity

The U.K. fund market is highly concentrated. Looking at 3,000 or so U.K.-domiciled funds in the market, some 40% of total assets are concentrated in the 100 largest funds.

Only two of this year’s U.K. Lipper Fund Award winners appear  in those 100 funds. In the mutual fund world, big isn’t always beautiful and investors and fund selectors should be looking to channel flows into a broader product suite.

Similarly, fund sales specialists, should be articulating the alpha generating potential that smaller, nimble funds can bring to investors.

Where are the winners from five years ago, today?

Winning a Lipper Fund Award is justifiably something to be proud of. However, investors often want to know that there is some evidence of persistence in a winner. Clearly past performance is not a reliable indicator of future performance, but there is some evidence that past winners are doing something right.

Looking at the five-year performance (to the end of 2019) of the U.K. winners of 2014, of the 20 category winners that year, 13 of the funds are in the first or second quartile of their Lipper peer group.  Five of the funds are in the third quartile for the period and only one fund is in the fourth quartile. One fund is closed (it closed whilst it was in the second quartile of its peer group).

So, five years on, 70% of past winners are still out-performing the median of their peer group. Consistent returns can be found.

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 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 penalise periods of underperformance, with more significant weightings given to excess negative returns. This methodology ensures 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 funds from the largest peer groups by assets under management in the U.K. fund universe were honoured for the three-year category with digital trophies showcasing their outperformance.

Baillie Gifford has been a regular winner over the last few years. They collected the Equity Global Income and Equity U.K. Awards for Baillie Gifford Global Income Growth A Inc and Baillie Gifford U.K. Equity Alpha A Inc, respectively.

Royal London Asset Management picked up a clean sweep in the mixed categories with Royal London Sustainable Diversified Trust A Inc, Royal London Sustainable Mngd Gro Trust B Acc and Royal London Sustainable World Trust A Inc winning the Mixed Asset GBP Balanced, Mixed Asset GBP Conservative and Mixed Asset GBP Aggressive categories respectively. Who says sustainability criteria can lead to sub-optimal outcomes?

First-time winners in the U.K. this year included Brown Advisory US Equity Growth A USD in the Equity US category and Tideway High Income Real Return A GBP in the Absolute Return GBP Low category.

The popular Equity U.K. Income category was collected for a third year in a row by TB Evenlode Income A Acc, and MI Chelverton UK Equity Growth B Acc clocked up another consecutive win in the UK Equity Small and Midcaps category.

A full list of the individual fund 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.

New faces this year included Verbatim Asset Management in the Mixed Assets Small category.

The big winners, however, were Royal London Asset Management and Baillie Gifford. RLAM not only collected a three fund awards but won two group awards for Bond Large Group and the coveted Overall Large Group—a third year of winning twice in the group awards.

A full list of the group winners can be found here.

We look forward to seeing you in 2021

Lipper from Refinitiv takes this opportunity to congratulate all the individual sector and group award winners in 2020.

We hope that we will be able to see and have you all together safely at the 2021 U.K. Lipper Fund Awards. We will meet again.


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


The Refinitiv Lipper Fund Awards, granted annually, highlight funds and fund companies that have excelled in delivering consistently strong risk-adjusted performance relative to their peers. 

The Refinitiv Lipper Fund Awards are based on the Lipper Leader for Consistent Return rating, which is a risk-adjusted performance measure calculated over 36, 60 and 120 months. The fund with the highest Lipper Leader for Consistent Return (Effective Return) value in each eligible classification wins the Refinitiv Lipper Fund Award. For more information, see lipperfundawards.com. Although Refinitiv Lipper makes reasonable efforts to ensure the accuracy and reliability of the data contained herein, the accuracy is not guaranteed by Refinitiv Lipper. 

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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