by Jake Moeller.
The 27th annual U.K. Thomson Reuters Lipper Fund Awards event was held at the elegant Chartered Accountant’s Hall on March 30, 2017. A full house of 200 participants from the U.K. and international fund management industries created an exciting buzz ahead of the industry’s premier night of recognizing excellence in fund management.
The event was well followed on Twitter with many members of the audience sharing their views via the hashtag #LipperFundAwards.
This year there was an emphasis on the history and importance of Lipper capabilities within the Thomson Reuters suite. A short video outlined the evolution of Lipper from its inception to the present day, enabling guests to better understand Lipper’s global reach within Thomson Reuters.
ESG – a valuable tool for active fund groups
Bob Jenkins – Lipper’s Global Head of Research, provided a keynote presentation discussing the importance of Environmental, Social and Governance (ESG) investing as a force for good in the world of funds management. He outlined how embedding ESG into their processes, active fund groups can further add value to investors in the face of increasing competition from passive funds.
Great Ormond Street Hospital
Great Ormond Street Hospital (GOSH) is at the forefront of medical care for ill children. Every day, 260 children arrive, doctors battle the most complex illnesses, and the brightest minds come together to achieve pioneering medical breakthroughs.
Thomson Reuters is a proud supporter of GOSH and this extraordinary hospital has always depended on charitable support to give seriously ill children.
Audience members at this year’s U.K. Lipper Fund Awards provided generous support for GOSH throughout the evening to the tune of £2,500. This will be well utilised by this worthy cause.
The “opportunity cost” of passive
Jake Moeller, Head of Lipper U.K. and Ireland Research, and emcee for the evening, provided insight into the active funds industry; he put forward passionate advocacy for the active fund industry citing the opportunity cost investors can potentially suffer by eschewing an active strategy using performance data from Lipper for Investment Management.
He also examined some of the popular misconceptions in the industry such as “closet tracking” which he revealed may not be as common as is often referred to in the market.
The 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 that 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 penalize periods of underperformance, with more significant weightings given to excess negative returns. This methodology ensures that 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 single funds from the largest peer groups by assets under management in the U.K. fund universe were honoured for the three-year category during the ceremony.
UBS shone with two separate awards: UBS Global Emerging Markets Equity A Acc in the Equity Global Emerging Markets category and UBS (Lux) Eq S – Global High Dividend (USD) P-Acc in the Equity Global Income category.
Marlborough was also well represented with MFM Techinvest Special Situations Fund winning the Equity UK SMIDs category and Marlborough European Multi-Cap winning in the Equity Europe ex UK category.
It was great to welcome regular visitor Prusik who once again collected the award in the Equity Asia Pacific Ex Japan category with Prusik Asian Equity Income 1 B USD. Courtiers made their second consecutive appearance at a Lipper Awards winning with Courtiers Total Return Growth Fund in the Mixed Asset GBP Flexible category.
A full list of winners can be found here.
The group awards
For the 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.
Exhibit 1. Group award winners and commendations
It is great to see a number of names who are making a habit of regular visits to the the Lipper podium: T. Rowe Price, Courtiers, Nordea, Jyske Invest and Fidelity have all been winners in recent years and are continuing to set a high standard for others in the industry.
Thomson Reuters Lipper takes this opportunity to congratulate all the individual sector and group award winners. A full photo gallery of the event is available here and we look forward to seeing you all again for another huge night in 2018.