by Dewi John.
On 20 April 2023, we unveiled the results of the Refinitiv Lipper Fund Awards for the UK.
To showcase the best examples of investment excellence, we’ve have produced a series of articles, blogs, and videos in what has been yet another testing year for fund managers. Given this challenging year for the global fund industry, the Refinitiv Lipper Fund Awards is sure to get considerable attention, as it showcases the ability of fund managers to deliver high risk-adjusted returns, over a year fraught with so many risks.
While the Refinitiv Lipper Fund Awards are entirely quantitative, this should not be understood in the sense of raw return numbers alone—award winners aren’t determined by picking the funds with the highest returns over the respective awards periods.
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, Refinitiv 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 losses.
This calculation methodology ensures that the winners are funds that have provided superior consistency and risk-adjusted returns, compared to similar funds. We believe this is more in line with how investors view financial gain and loss, meaning that funds receiving 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 Refinitiv Lipper Fund Awards recognised those funds which had the highest score in the Lipper Leader rating for Consistent Return over the three-, five-, and 10-year periods. Overall, there were 89 funds that won an award for the three-year period. Some, 84 funds were also recognised with a Lipper Fund Award over the five-year period, and 67 funds won the prestigious trophy for the 10-year period. The complete lists of the winning funds can be found on our awards website
Artemis SmartGARP UK Equity R Acc GBP made a clean sweep of the Equity UK Lipper Fund Award, winning over the three-, five-year and 10-year periods.
LF Gresham House UK Smaller Companies C Acc was named the Lipper Fund Award winner for Equity UK Small- and Mid-Cap over three-years, with MI Chelverton UK Equity Growth B Acc winning over five-year periods, while Liontrust UK Smaller Companies Fund R Inc won over the 10-year period.
This has proved a popular market over the course of the year, and the Orbis OEIC Global Balanced Fund Standard SC Acc won the award for this category over three years, BNY Mellon Multi-Asset Growth GBP Inc over five, and the Royal London Sustainable World Trust A Inc over 10.
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. The complete lists of the winning asset management groups can be found on our awards website.
Within the bond segment, the best small asset manager was Rubrics, which outperformed 13 competitors in this category. The best large bond fund manager was Royal London, which topped a list of 55 in this category.
Waverton beat 80 others to be named the best small asset manager in the equity segment, while Royal London won the trophy as the best large equity asset manager, beating 67 competitors in terms of consistent outperformance.
There were 48 and 47 asset managers competing for the Lipper Fund Awards for large and small classifications respectively in the mixed-asset segment. While Courtiers won the trophy for the best small manager, the award for the best large manager went to DWS.
The winning group for the overall award was able to show an above-average risk-adjusted performance within its bond, equity, and mixed-asset products. Given its domination in equity and bond, it’s no surprise that this award was scooped up by Royal London. The winner of best overall small manager was Julius Baer.
As you can see from the number of fund management groups in each category, the Lipper Fund Awards are exceedingly competitive and recognise 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.
Refinitiv Lipper data covers more than 360,000 share classes in more than 80 countries. The Lipper Leader ratings are available for mutual funds registered for sale in 47 markets. Find out more.
The views expressed are the views of the author and not necessarily those of Refinitiv. This material is provided 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.
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.
About Refinitiv Lipper Fund Awards:
For more than 30 years and in more than 17 countries worldwide, the highly-respected Refinitiv Lipper Awards have honoured funds and fund management firms that have excelled in providing consistently strong risk-adjusted performance relative to their peers and focus the investment world on top funds. The merit of the winners is based on entirely objective, quantitative criteria. This, coupled with the unmatched depth of fund data, results in a unique level of prestige and ensures the award has lasting value. Renowned fund data and proprietary methodology is the foundation of this prestigious award qualification, recognizing excellence in fund management. Find out more at www.lipperfundawards.com.