Hargreaves Lansdown removes abrdn Asia Pacific Equity fund from Wealth Shortlist
“Our analysis suggests that, for several years, the manager has not consistently added value through stock selection,” Ince said.
The £830.9m fund was launched in 1987 and is run by the management team of Flavia Cheong, Louis Lu, Pruksa Iamthongthong, James Thom and Christina Woon.
It invests in Asia Pacific focused equities, excluding Japan, with investments in TSMC, Samsung Electronics and Tencent Holdings, among others.
Cheong has worked on the fund since 1996 and has worked «closely» with Iamthongthong since the latter joined in 2007, according to HL investment analyst Henry Ince.
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In a research note, Ince said that during that interim, the fund outperformed both its benchmark and bested the average return of its sector peers.
However, he said that the team's conviction in the fund had been tested more recently, noting that it had failed to outperform the benchmark and the IA sector average over the last decade.
According to FE fundinfo data, the fund made 66.2% total returns during the ten-year period, whereas the benchmark made 87.6% and the sector averaged 91.4%.
«Our analysis suggests that, for several years, the manager has not consistently added value through stock selection,» Ince said.
«This is a key factor we analyse when assessing a fund manager, and represents their ability to pick strongly performing companies regardless of what size or sector they are in.»
Ince said that given the managers' focus on ‘quality' companies, it would have typically been expected that the fund to hold up a better when markets fall, but noted it «has not met these expectations in recent years».
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