The best performing investment funds in 2019 are active funds. More importantly: they are mainly funds registered in the Grand Duchy of Luxembourg. Those are the findings of a half-yearly study by consultant AF Advisors of investment funds available for private investors in the Netherlands.
Consultant Bas Nagtzaam explains why it is mainly the Luxembourg registered funds that perform so well in the latest AF Advisors study (see attachment): it is a fact that many active investment funds are domiciled in Luxembourg, ‘mainly because it is easy to register a fund in the country, it is a first class supervisor, practical and without too much hassle›.
Add to this the low taxes to be paid by funds: for private investors, the «taxe d’abonnement» is 5% and 1% for institutional investors. Ever since the 1980s Luxembourg has therefore been an attractive location to register funds.
Retrocession ban
Nagtzaam is surprised Luxembourg funds are so well-represented among the top-performers within categories such as ‹Global Large Cap Equity› and ‹US Large Cap›.
‘Usually, we would expect several Dutch funds here because the Netherlands has better tax treaties with the US and because of that reason, start the year with a yield advantage on the Luxembourg funds of approximately 25 to 40 basis points. However, 2019 was a very good year for stocks: MSCI World had its best year since 2009 with nearly 28%. An outperformance by active managers is to be expected in such a climate, as they can take specific risks, for example by choosing growth instead of value’, according to AF Advisors.
Frontrunners
‘Global Large Cap Equity’ is dominated by Morgan Stanley, which occupies the top two places. Their Global Opportunity fund has been top of the list for at least two years. And in this category, the Robeco Global Consumer Trends Equities fund jumped from 9 to 3.
A few other funds that have been occupying the top spot in their category for a while now are: Fidelity European Dynamic Growth (European Large Cap Equity), Comgest Growth European Smaller Companies (European Small & Mid Cap Equity) and Generali Euro Bond (European Government Bonds).
The fund that has been in the top 10 most often is the Blackrock European Special Situations Fund: 29 times out of 32.
The ‘High Yield’ category is invariably led by the Robeco High Yield Bonds fund. The QI Dynamic High Yield fund of the same house fell from 2 to 4.
These funds are all assessed, based on different quantitative and qualitative factors, including their yield over 3, 5 and 10 years, risk-adjusted yield, costs, in and outflow and the availability of information.