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21 December 2009

Commodities and Natural Resources top sector in 2009, whilst Asia Pacific sector is the winner over a decade

AIC looks at performance over the last decade and in 2009

• JPMorgan Russian Securities top of the decade up 1,398%
• Strategic Equity Capital best performer this year up 168%

It’s been a turbulent decade for equity investors.  From the unravelling of the dot com boom which characterised the beginning of the decade, through to the banking crisis and credit crunch of 2008/09, financial markets have definitely been put to the test.  However investors who held their nerve have tended to ride out the storm and some braver investors have been highly rewarded. 

Best performer of the decade - from Russia with love
The average investment company is up some 50% over the last 10 years, but the top performing investment company over the decade was JPMorgan Russian Securities, up a staggering 1,398%.  A £100 investment in JPMorgan Russian Securities 10 years ago would have grown to £1497.59 (the company is also the 10th top performing investment company over the last year, up 109%).  The second top performing investment company over the decade was BlackRock World Mining, a Sector Specialist: Commodities and Natural Resources investment company, up 562%.

Top performing investment companies over 10 years – share price total return on £100 to 30 November 2009 (AIC Members)

Duration		1 year	3 years	5 years	10 years
Fund	Sector
JPMorgan Russian Securities	Country Specialists: Europe	208.81	92.75	245.72	1497.59
BlackRock World Mining	Sector Specialist: Commodities and Natural Resources	207.12	122.25	246.65	661.62
Baring Emerging Europe	European Emerging Markets	167.14	103.59	221.19	635.81
Eastern European	European Emerging Markets	167.73	75.88	146.51	591.98
BlackRock Latin American	Latin America	215.47	168.13	376.54	548.73

Top sector of the decade - Asian dragon roars
Asia has proved to be the world’s global economic powerhouse over the decade, with the Country Specialists: Asia Pacific sector topping the performance tables, up an impressive 312%.  Other Asian sectors were not far behind, with the Global Emerging Markets sector in second place, up 284% (which often has an Asian focus), followed by Asia Pacific Excluding Japan, up 136%. 

Top performing sectors over 10 years – share price total return on £100 to 30 November 2009

Duration	1 year	3 years	5 years	10 years
Sector
Country Specialists: Asia Pacific	157.73	87.92	233.99	411.97
Global Emerging Markets	161.27	150.9	284.32	383.93
Asia Pacific - Excluding Japan	174.02	130.32	203.5	235.78
Sector Specialist: Biotechnology/Life Sciences	113.01	107.07	128.77	216.39
UK High Income	137.73	86.41	124.01	192.33

Top performing investment companies this year
The top performing AIC member investment company over the last year was a UK Growth investment company, Strategic Equity Capital, which was up 168%, although this follows a period of volatility for the company.  This compares to a 28% rise for the average investment company over the last year. 
Top performing investment companies over 1 year – share price total return on £100 to 30 November 2009 (AIC Members)          

Duration		1 year	3 years	5 years	10 years
Fund	Sector
Strategic Equity Capital	UK Growth	267.59	52.72
Kenmore European Industrial	Property Direct - Europe	263.12	46.61
INVESCO Leveraged High Yield	Global High Income	241.43	67.71	81.5
Active Capital	UK Smaller Companies	234.21	47.43	54.57
ING UK Real Estate Income	Property Direct - UK	216.18	55.13

Best performing sector of the year - all that glitters
As ‘all that glitters’ tends to have universal appeal during turbulent economic times, it’s clear that commodities and natural resources funds have continued to hold their appeal over the last economically-troubled year.  The top performing investment company sector over the last year is Sector Specialist: Commodities and Natural Resources, up 82%.

Top performing sectors over 1 year – share price total return on £100 to 30 November 2009

Duration	1 year	3 years	5 years	10 years
Average investment company	128	88.15	138.74	150.24
Sector
Sector Specialist: Commodities and Natural Resources	181.99	123.22
Country Specialists: Europe	180.23	80.78
Asia Pacific - Excluding Japan	174.02	130.32	203.5	235.78
UK Smaller Companies	163.85	76.22	117.61	133.69
Property Securities	163.21	70.6

Don’t write off the UK
Despite the dominance of sectors such as Asia and Commodities and Natural Resources, AIC figures suggest it would be unwise to overlook the UK. The top performing AIC member investment company over the last year was actually a UK Growth investment company, Strategic Equity Capital, which was up 168%, although this follows a period of volatility for the company.  The UK Smaller Companies investment company sector is the 4th top performing sector over the last year, up 64% whilst the UK Growth sector also posted impressive returns, up 43%.

Annabel Brodie-Smith, Communications Director, Association of Investment Companies (AIC) said: “After a less than auspicious start for equities, it’s been a good year for investors who held their nerve, with the average investment company up some 28% - not bad when interest rates remain at an all time low.  That said, the financial events of the last decade illustrate that reward also comes with its fair share of risk. The key message of the last decade would seem to be ‘keep calm and carry on’ – investment company investors who have held their nerve have tended to be rewarded.

“Investment companies can be a very useful way of spreading investment risk as they invest in a range of companies on your behalf.  With a variety of sectors and countries to choose from there is something to suit a variety of risk profiles and they are available from as little as £50 a month.”

For interactive AIC performance figures, please see the statistics section of the AIC's website.

- Ends -

Notes to Editors:

1. Performance figures are mid market share price with net income reinvested and a 3.5% deduction for charges, stamp duty and market spread.  Source: AIC using Morningstar.
2. Discrete annual performance figures for individual investment companies mentioned – share price total return on £100

Performance from	30/11/2008	30/11/2007	30/11/2006	30/11/2005	30/11/2004
Performance to	30/11/2009	30/11/2008	30/11/2007	30/11/2006	30/11/2005
Duration (years)	1	1	1	1	1
Average investment company	128	60.38	103.52	112.17	127.16
Fund
Strategic Equity Capital	267.59	23.72	77.34	93.42
Kenmore European Industrial	263.12	21.65	76.19
INVESCO Leveraged High Yield	241.43	27.96	93.41	110.78	101.17
Active Capital	234.21	19.88	94.87	100.09	107.04
ING UK Real Estate Income	216.18	38.27	62.06	113.01
JPMorgan Russian Securities	208.81	30.61	135.14	139.56	176.78
BlackRock World Mining	207.12	37.26	147.54	127.04	147.89
Baring Emerging Europe	167.14	45.43	127.05	116.44	170.78
Eastern European	167.73	33.59	125.43	107.07	167.91
BlackRock Latin American	215.47	54.42	133.52	127.01	164.22

3. The Association of Investment Companies was founded in 1932 to represent the interests of the   investment trust industry – the oldest form of collective investment. Today, the AIC represents a broad range of closed ended investment companies, incorporating investment trusts and other closed ended investment companies and VCTs.  The AIC’s members believe that the industry is best served if it is united and speaks with one voice. The AIC’s mission statement is to help Members add value for shareholders over the longer term. The AIC has 345 members and the industry has total assets of approximately £83 billion.

                                        

 

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