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Where picking the right fund matters most

How significant is fund underperformance?
Where picking the right fund matters mostPublished on August 23, 2024
  • With plenty of ups and downs for markets, we look at where the biggest gaps have emerged between the best and worst active funds
  • The risks of landing a dud seem lower than they were a few years ago

The bi-annual emergence of Bestinvest’s ‘Spot the Dog’ report always increases the focus on underperforming active funds. But in recent years the odds of investors finding themselves landed with a truly bad pick have been relatively low.

IC analysis shows the dispersion of returns among equity funds has fallen back in UK private investors’ favoured stock markets since the pandemic, suggesting that the average fund has done a better job of keeping pace with peers – over short time periods, at least.

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