Revealed: Best performing funds and trusts of 2021
Commodities and emerging markets strategies have been among the biggest winners this year across both funds and investment trusts, new data has shown.
However, the new Omicron variant could disrupt matters over the next month if the virus continues to spread, and coronavirus restrictions tighten.
According to a new analysis by Interactive Investor, the top performing investment trusts outperformed the highest returning funds in the period from 1 Jan to 30 November.
In the investment trust sector, two Vietnam focused strategies made the top 10, while India featured in the top 10 for both funds and investment trusts.
Commodities and energy-related strategies also topped the performance tables amid an ongoing crisis, increased natural gas prices, rising inflation, and the tapering of government economic stimuli.
Top investment trusts
Coming in as the top performer was niche investment trust, Geiger Counter, which has £59m in assets under management. It was the stellar performer overall, returning 104% according to Morningstar data.
The trust invests in companies involved in the exploration, development and production of uranium to supply the nuclear power industry.
Riverstone Energy, which has so far seen a return of 79%, seized the second spot on the list of best performing investment trusts.
This was followed by VietNam Holding (returning 67%), which is one of two Vietnam focussed portfolio in the top 10 – the other Vietnam Enterprise (returning 55%) in fifth position.
Ashoka India Equity (returning 45%) is the other frontier/emerging markets strategy on the list, in eighth position.
“The broad recovery in commodity prices seen over 2021 is now under threat on a number of fronts,” Keith Bowman of at Interactive Investor said.
“The discovery of the Omicron virus and increased global social restrictions over the winter months could pressure demand and prices. Returns to working from home now overshadow the oil price for example.”
Read more: OBR: Coronavirus pandemic delivered largest forecast errors on record
Top investment funds
The top performing investment fund year-to-date is Schroder ISF Global Energy, returning 50%. Two energy focussed portfolios and a frontier market strategy make up the top three in the list of best performing funds in 2021.
In second place was Goldman Sachs North America Energy and Energy Infrastructure Equity which returned 48%, ahead of T. Rowe Price Frontier Markets Equity and PIMCO GIS MLP & Energy Infrastructure Fund which both returned 40% during the period.
VT De Lisle America, which targets attractive long-term returns by investing primarily in equities in North America, made up the top five, returning 36%.
Goldman Sachs India Equity, which came in at eighth position is the only other frontier or emerging market strategy in the top 10, returning 33%.
“It has been a great year for commodities which have been the second-best performing asset class this year after Bitcoin,” Dzmitry Lipski, head of funds research at Interactive Investor, said.
“Historically, investors turned to commodities as a source for portfolio diversification and hedge against rising levels of inflation. In fact, commodities have tended to be in a bear market for over a decade.”
Read more: European stock markets muted as new COVID restrictions imposed in England
He added: “More recently there is improved sentiment towards the asset class on the back of structural long-term trends. These include economic recovery potential from the pandemic and inflation fears along with infrastructure spending and hence higher demand for materials. We added WisdomTree Enhanced Commodity to Super 60 in May this year as a low-cost option.
“But don’t let the top performers turn your head too much. Niche strategies should only ever be part of a well-balanced diversified portfolio.”
Watch: What is inflation and why is it important?