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Special Report

ESG: The metrics jigsaw


CAPS show GAM-run J Rothschild fund top in 2001

UK- The GAM-managed J Rothschild stable of funds was the only UK balanced fund to produce positive returns in 2001 according to the CAPS report on the performance of UK pension schemes’ pooled funds. According to Alan Wilcock, head of research and development at Russell/Mellon CAPS, the fund had a high yield bias and at times had up to 25% in cash.

The annual survey, whose latest edition covers 83 asset managers with a combined £199bn in pooled funds, shows another positive year for value managers and a second consecutive year of awful returns from growth managers. Value stocks returned an average 2.2% in 2001 while growth stocks lost an average 2.8%.

Philips and Drew, the value manager who attracted savage publicity for poor performance in 1998 and 1999 saw its two balanced funds in the top five performers in 2001, the second year running after it took the top two places in 2000.

Funds run by Aegon and OM Gerrard were the worst performers in 2001 with returns of –23.5% and –20% respectively, figures way below the median of –11.9%.

Many of the large well known investment managers reported poor returns in 2001. Both Merrill Lynch and Gartmore failed to beat the CAPS median for the second consecutive year and both fall below the five year median of 6.7%.

For overseas funds, Marathon AM led the field with returns of –1.7%, followed by Templeton with a corresponding figure of –3.3%, both well above the overseas median of –16.8%. Marathon and Templeton took the top two places, in reverse order, in 2000.

The survey says increased volatility has cut the number of funds consistently outperforming their section median over the last five years. “It is very difficult, given the market conditions we have had, for managers to be consistent,” says Wilcock.

The survey also reported a significant growth in the number of indexed funds, up from 17 to 100 in the ten years to the end of 2001 taking to total indexed assets from £5.1bn to £106.8bn over the same period.

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