Archived article
Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
Ryan Hughes, AJ Bell's Head of Active Portfolios, looks at the worst performing funds from Asia, China, Emerging Markets and Global sectors so far this year.
| Fund | IA Sector | Performance from 01/01/20 – 04/02/20 |
|---|---|---|
| Schroder Global Energy | Global | -11.52% |
| Guinness Global Energy | Global | -10.59% |
| Meridian Global Energy | Global | -6.56% |
| AB Asia Ex Japan Equity Portfolio | Asia Pacific ex-Japan | -6.01% |
| Barclays Global Access Asia Pacific Ex-Japan | Asia Pacific ex-Japan | -5.60% |
| ASI China A Share | China/Greater China | -5.35% |
| New Capital China Equity | China/Greater China | -5.31% |
| Artemis Global Emerging Markets | Global Emerging Markets | -5.29% |
| Barclays Global Access Emerging Market Equity | Global Emerging Markets | -5.22% |
| Waverton Asia Pacific | Asia Pacific ex-Japan | -5.19% |
Source: FE
“It’s interesting that the three funds that have been hardest hit are all global energy funds, showing that the effects of Coronavirus are not confined to emerging markets funds," says Ryan.
"Concerns around the impact the outbreak will have on the growth of the global economy and China in particular, is leading to fears that there will be lower demand for natural resources.
“Nearly all Chinese equity funds have been hit hard by the Coronavirus outbreak, with only three out of 38 funds in the sector showing positive performance this year. Asian and general Emerging Markets funds are also among the worst affected.
“Investors will understandably be concerned about what impact Coronavirus is having on their portfolios but as always it is important not to panic and make knee-jerk decisions that could simply lock in losses.
“While it may be tempting to head for the exit, long term investors should remember that it is time in the market more than timing the market that is important. If we look back to the SARS outbreak in 2002 – 2003, it had a short term negative impact on markets but once the outbreak had been contained, markets recovered very quickly. Investors selling at the first sign of short term volatility therefore lock in losses that have already been incurred and then miss the bounce back once things have calmed down. Some canny long term investors may even be seeing now as an opportunity to top up their exposure to China or Asia / Emerging Markets more generally.
“There is no doubt that staying calm as an investor in these situations can be difficult. It can help to remind yourself what your original investment objectives and time horizon were and decide whether the current situation really changes those. Emerging markets are likely to represent a small portion of most investors’ portfolios so the overall impact should be limited. Now is the time for a steady hand and to stay focused on your long term goals and objectives.”
| IA fund sector | No. funds in negative performance | No. funds in positive performance |
|---|---|---|
| Asia | 94 | 18 |
| China | 35 | 3 |
| Emerging Markets | 88 | 26 |
| Global | 82 | 251 |
Source: FE
These articles are for information purposes only and are not a personal recommendation or advice.
Written by:
Ryan Hughes
Ryan Hughes, Investments Director - AJ Bell Investments
Ryan started his career in 1999 working for an independent financial adviser, progressing to become Head of Portfolio Management at an award-winning advisory firm. Ryan then joined a global asset management firm as a Fund Manager, where he oversaw more than £10bn of multi-asset portfolios and also sat on the investment and global asset allocation committees. After seven years, Ryan joined a small multi-asset boutique managing portfolios for clients all around the world, before joining AJ Bell in 2016 to help establish our investment capability and overseeing all investment research for AJ Bell. In 2022, Ryan was appointed as Head of Investment Partnerships with responsibility for managing bespoke portfolios tailored to specific adviser needs and then in 2023, Ryan was made Investments Director with oversight of AJ Bell’s investment capability.
Ryan is a member of the CFA UK Society, is frequently asked for his views in the press and on panel debates while also being recognised as one of the leading fund researchers in the UK.
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