Best and Worst Funds in 2021

Here we look at the 20 Best and Worst funds this year. The wide range of funds emphasises how important fund selection is to your investing success.

Energy, India and North American Funds all shine

There is a similar picture between the top funds and the top sectors, the latter analysis you can view here. Whether it be individual funds or the sectors as a whole, India, North America and Commodity/Natural Resources are dominant.

Commodity/Natural Resources makes an appearance thanks to a couple of big energy funds run by BlackRock and Guinness. There’s also Schroder ISF Global Energy, the current fund in our Bonkers 6-Month Portfolio, which sits in the Global sector.

25% of the top 20 are Indian funds, including a duo of Jupiter funds.

Similarly, five North America funds feature, one being smaller companies.

China Funds Disappoint

Just under half of the stragglers are China funds!  The worst is down 20%.

The worst fund is Brazilian, down 25%, and the number of Latin America funds reflect that this region was also the standout dud in our sector analysis.

With all that fear about inflation, it will surprise gold fans, but not our readers, that gold had a poor year.  The Jupiter fund is down 16%.

At the beginning of the year all the talk was about “disruptive innovation”, and investors rushed into a fund managed by a previously unknown individual, moving rapidly towards retirement.  That Nikko AM ARK fund is down 23% - we did highlight “issues” with the fund early on in 2021.

Similarly, the growth-style Baillie Gifford Global Discovery fund has gone from a top fund in 2020 to a bottom fund in 2021 – a remarkable turnaround for the worse, and re-emphasising this ever evolving Value vs Growth debate.

Lessons to Take Away

Looking at the best and worst funds this year is all well and good. But this doesn’t tell us what will do well and what will do badly next year.

This is why using an objective process like Dynamic Fund Ratings to select funds, and sticking to it with discipline, is crucial.

And, as Table 2 indicates, having a Stop-Loss in place is vital. If you don’t already use our Stop-Losses tool then you should decide what action you will take when you encounter sharp falls. Pre-commit now, in a moment of calm.

Table 1: Top 20 Performing Funds in 2021

Table 2: Bottom 20 Performing Funds in 2021

NOTE

Fund performance 01/01/2021 – 14/12/2021.

Funds <50m in size and ETFs excluded.

All Investment Association sectors considered, aside from (UT) EUR Government Bond, (UT) USD Government Bond, (UT) Standard Money Market, (UT) Unclassified and (UT) Not Yet Assigned.

FURTHER READING

• Best and Worst Sectors in 2021
• Bonkers 6-Month – Dynamic Portfolio Review  
• Stop-losses. A key part of your plan