Top-performing investment company sectors in 2020

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Hedge Funds is the top-performing investment company sector in the year to date, new data from the Association of Investment Companies (AIC) can reveal. The sector produced a 56% return in the 11 months to November compared to the average investment company’s return of 8% over the same period. The Hedge Funds sector includes Pershing Square Holdings, recently promoted to the FTSE 100.

Technology & Media achieved the second-highest return of 42%, followed by Global with 36%. Japanese Smaller Companies (32%) and Japan (28%) complete the top five sectors reflecting a strong rebound from the pandemic lows.

Annabel Brodie-Smith, Communications Director of the Association of Investment Companies (AIC), said: “Despite the beginning of the year being a very challenging time for markets, investment companies have bounced back strongly from the March crash. Hedge funds have performed remarkably well, with volatile markets being helpful to many of their strategies. They were among the investment companies that held up best in the tough first quarter of the year and they have lived up to their name by preserving capital in deeply uncertain times.

“Investment companies in the Technology & Media sector have performed very healthily too and it’s easy to understand why. From Zoom drinks to online groceries, technology has been a lifeline this year and helped us to stay connected to friends and colleagues through lockdowns and restrictions.

“Though this year’s top-performing sectors tell an interesting story, it’s important to remember that investment is about the long term. Building a balanced portfolio of investments which suits your needs, rather than just focusing on today’s winners, is what’s most important.”

Top 10 investment company sectors from 1 January to 30 November 2020

 

Share price total return (%)

Share price total return (%)

Share price total return (%)

Share price total return (%)

Share price total return (%)

 

01/01/2020

01/12/2019

01/12/2017

01/12/2015

01/12/2010

 

30/11/2020

30/11/2020

30/11/2020

30/11/2020

30/11/2020

AIC sector

Year to date

1 year

3 years

5 years

10 years

Overall weighted average ex. VCTs

8.4

12.1

26.0

70.4

178.9

Hedge Funds

55.7

56.3

92.8

74.2

91.5

Technology & Media

41.7

47.7

N/A

N/A

N/A

Global

35.7

42.9

65.5

155.7

323.0

Japanese Smaller Companies

31.6

29.3

43.4

169.6

291.2

Japan

28.0

26.8

34.9

120.8

342.9

Asia Pacific

27.7

31.1

39.6

132.3

178.1

Country Specialist: Asia Pacific ex Japan

26.9

28.9

32.4

132.4

184.5

Environmental

25.8

29.5

64.5

148.2

N/A

North America

21.3

23.0

39.1

105.2

229.8

Global Smaller Companies

21.2

24.4

45.9

113.8

310.8

Source: AIC/Morningstar. Sectors are weighted averages. N/A denotes where there are too few constituents to calculate a meaningful average.

-ENDS-

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Notes to editors

  • Data source: AIC/Morningstar. Sectors are weighted averages. All data excludes VCTs.
  • The table below shows discrete annual % share price total returns for 12-month periods to 30 November.

Performance from

01/12/2015

01/12/2016

01/12/2017

01/12/2018

01/12/2019

Performance to

30/11/2016

30/11/2017

30/11/2018

30/11/2019

30/11/2020

Overall weighted average ex. VCTs

14.1

18.9

2.5

10.0

12.1

Sectors

 

 

 

 

 

Hedge Funds

-2.2

-3.1

5.5

18.1

56.3

Technology & Media

N/A

N/A

N/A

24.4

47.7

Global

19.4

31.0

6.2

10.8

42.9

Japanese Smaller Companies

27.9

46.9

2.2

4.6

29.3

Japan

18.0

36.0

-3.5

9.3

26.8

Asia Pacific

27.5

30.2

-2.5

10.4

31.1

Country Specialist: Asia Pacific ex Japan

34.2

31.0

-3.9

7.4

28.9

Environmental

24.9

20.2

5.0

21.3

29.5

North America

31.1

12.2

9.1

11.2

23.0

Global Smaller Companies

14.7

26.6

2.6

17.4

24.4

  • The Association of Investment Companies (AIC) 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 358 members and the industry has total assets of approximately £209 billion.
  • Disclaimer: The information contained in this press release does not constitute investment advice or personal recommendation and it is not an invitation or inducement to engage in investment activity. You should seek independent financial and, if appropriate, legal advice as to the suitability of any investment decision. Past performance is not a guide to future performance.  The value of investment company shares, and the income from them, can fall as well as rise.  You may not get back the full amount invested and, in some cases, nothing at all.
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