Canstar’s Managed Fund Star Ratings and Award winners for 2021

ELISE DONALDSON
Managed funds can offer access to a wide range of investment opportunities managed by a professional. If you’re considering whether a managed fund may be an option for you, or already invest with one, you may want to check out Canstar’s 2021 Managed Fund Star Ratings and Awards. We reveal which products and providers came out on top.

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When you invest in a managed fund, you pool your money together with other investors, and this pool of funds is managed by a fund manager who can buy and sell assets, such as shares or bonds, on your behalf. By investing money alongside others, you may have access to different asset classes and market sectors that could otherwise be out of reach as an individual.

There’s no shortage of managed funds to choose from in Australia, and according to the Australian Bureau of Statistics (ABS), the Australian managed funds industry had $3,997.1 billion funds under management as of December 2020.

If you are thinking about investing in a managed fund, or already have an investment with one, Canstar’s Star Ratings and Awards can help identify which products and providers may offer better value.

Canstar’s Managed Fund Star Ratings and Awards analysed 384 managed funds across 56 providers on our database. From this process, we identified 38 individual funds that received a 5-Star Rating and so were recognised with an Outstanding Value Award and three Award-winning managed fund providers who were recognised for their strong overall performance across multiple asset classes and consumer categories.

Managed funds were analysed based on both their performance and features. The strength and consistency of a fund’s returns over the last five years were among the main factors considered when it came to assessing its overall performance. The features assessed fell into four categories:

  1. Opening your account (e.g. ease of application process and payment options)
  2. Investment flexibility (e.g. investment options and distribution)
  3. Support (e.g. access to a call centre)
  4. Closing your account (e.g. ease of withdrawing funds and what fees apply)

For the three provider Awards, institutions were assessed based on their top-performing fund across the Managed Funds Star Ratings profiles.

To be eligible for Canstar’s Managed Funds Star Ratings and Awards, each fund and provider had to meet criteria that included:

  • Having an initial minimum investment amount equal to or less than $25,000
  • Being open to new investors and available directly to the consumer (not via an advisor or platform only)
  • Not having an entry fee (or deferred entry fee), an initial contribution fee or an establishment fee
  • Having a minimum of five years of performance history available at the time the Star Ratings and Awards were calculated
  • Having minimum funds under management (FUM) of $50m
  • Not being a hedge fund or exchange-traded fund (ETF)

2021 Outstanding Value Managed Funds

Here are the managed funds that took out an Outstanding Value Award for receiving a 5-Star Rating this year. The Outstanding Value Award-winning products in each profile are sorted by provider name.

Single asset class funds

Australian Cash

These are funds that are largely invested in highly liquid, short-term securities such as bank deposits, cash and bank bills. The overall maturity is expected to be less than one year. Exposures to cash/overnight accounts are also included.

Provider Outstanding Value Award-winning fund
Advance Asset Management Advance Cash Multi-Blend Fund
Mutual Limited Mutual Cash Term Deposits and Bank Bills Fund

Australian Fixed Interest

Funds which invest in the same sorts of assets as Australian Cash, such as bank deposits and bank bills, but may also invest in government bonds or corporate debt and asset-backed securities.

Provider Outstanding Value Award-winning fund
Advance Asset Management Advance Australian Fixed Interest Multi-Blend Fund
Nikko Asset Management Aust Ltd Nikko Asset Management (AM) Australian Bond Fund

Australian Shares – Large Cap

Funds that invest in domestic stocks which are in the top 70% of the stock market by total value, with varying balances of growth (higher-risk, higher-value) and value (lower-risk, lower-value) stocks.

Provider Outstanding Value Award-winning fund
Australian Unity Funds Platypus Australian Equities Fund – Wholesale
Bennelong Funds Management Ltd Bennelong Australian Equities Fund
Fidante Partners Limited Alphinity Sustainable Share Fund
Fidante Partners Limited Greencape Broadcap Fund
Fidante Partners Limited Greencape High Conviction Fund
Macquarie Investment Management Macquarie Australian Shares Fund

Australian Shares – Mid/Small Cap

These funds invest in domestic stocks in the bottom 30% of the equities market by total value, with varying levels of investment in high-growth and low-growth stocks.

Provider Outstanding Value Award-winning fund
Australian Ethical Investments Australian Ethical Emerging Companies Fund Wholesale
Colonial First State Investments FirstChoice Wholesale Investments – CFS Wholesale Small Companies – Core
Macquarie Investment Management Macquarie Australian Small Companies
Pendal Fund Service Limited Pendal MicroCap Opportunities Fund

Equity Australia Real Estate (Australian Property)

Funds that invest mostly (at least 75%) in domestic listed property trusts, either directly or through property syndicates. The remainder may be invested in direct property and/or cash.

Provider Outstanding Value Award-winning fund
One Managed Investment Funds Ltd Charter Hall Maxim Property Securities Fund
UBS Asset Management UBS Property Securities Fund

Global Fixed Income & Bonds

These are funds invested in foreign government and corporate debt, with terms to maturity generally greater than one year. A small portion may also be invested in cash or cash-like securities to hedge currency risks. At least 25% of the portfolio invested in Australian Bonds is required.

Provider Outstanding Value Award-winning fund
IOOF Investment Management Ltd IOOF MultiMix Diversified Fixed Interest Trust
Macquarie Investment Management Macquarie Dynamic Bond Fund
PIMCO Australia Management Ltd PIMCO Global Bond Fund Wholesale Class

Global Shares – Large Cap

Funds investing in global stocks in the top 70% of the equities market by total value. Funds may have varying levels of investment in low-growth and high-growth stocks.

Provider Outstanding Value Award-winning fund
Antares Capital Partners Ltd Intermede Global Equities Fund
Colonial First State Investments CFS FirstChoice – T. Rowe Price Wholesale Global Equity
Equity Trustees Limited Evans & Partners International Fund
Equity Trustees Limited Evans and Partners International Fund (Hedged)
Equity Trustees Limited Loftus Peak Global Disruption Fund
Macquarie Investment Management Walter Scott Global Equity Fund (Hedged)
Nikko Asset Management Aust Ltd Nikko Asset Management Global Share Fund
Pinnacle Fund Services Ltd Hyperion Global Growth Companies Fund – Class B

Multi-sector funds

Multi-Sector Moderate

Funds that invest in multiple sectors and have 21%-40% of their investments exposed to growth sectors.

Provider Outstanding Value Award-winning fund
IOOF Investment Management Ltd IOOF MultiMix Conservative Trust
OnePath OneAnswer Frontier Investment Portfolio – Vanguard Conservative Index

Multi-Sector Balanced

Funds that invest in multiple sectors and have 41%-60% of their investments exposed to growth sectors.

Provider Outstanding Value Award-winning fund
Colonial First State Investments FirstChoice Wholesale Investment – First Sentier Wholesale Balanced
IOOF Investment Management Ltd IOOF MultiSeries 70
OnePath OneAnswer Frontier Investment Portfolio – Vanguard Balanced Index

Multi-Sector Growth

Funds that invest in multiple sectors and have 61%-80% of their investments exposed to growth sectors.

Provider Outstanding Value Award-winning fund
Ausbil Investment Management Ausbil Balanced Fund
Colonial First State Investments FirstChoice Wholesale Investment – First Sentier Wholesale Diversified
IOOF Investment Management Ltd IOOF MultiMix Balanced Growth Trust
OnePath OneAnswer Frontier Investment Portfolio – Vanguard Growth Index

Multi-Sector Aggressive

Funds that invest in multiple sectors and have more than 80% of their investments exposed to relatively volatile ‘growth sectors’ such as shares and property.

Provider Outstanding Value Award-winning fund
Australian Ethical Investment Australian Ethical Diversified Shares Fund (Wholesale)
Colonial First State Investments FirstChoice Wholesale Investment – First Sentier Wholesale High Growth

2021 Managed Fund Provider of the Year Awards

Canstar’s three Managed Fund Provider of the Year Award categories are:

  • Provider of the Year – Managed Funds: awarded for overall outstanding value across a variety of different asset classes and profiles.
  • Provider of the Year – Managed Funds Australian Equities: awarded for outstanding value within the domestic equities market.
  • Provider of the Year – Managed Funds Multi-Sector Funds: awarded for outstanding value across multiple multi-sector funds.

This year’s winners are:

Provider of the Year – Managed Funds: Colonial First State Investments

Colonial 2020 Gold AU Release Logos

For the third year running, Colonial First State Investments has taken out the Provider of the Year – Managed Funds Award.

Canstar Research said this provider retained the Award in 2021 because it continued to offer a wide range of managed funds both in Australia and globally, and improved its performance, relative to its peers, in the domestic mid/small cap, global large cap and multi-sector growth profiles.

According to the Colonial First State investment website, it offers over 130 investment options, and investments in cash, fixed interest, shares, property and infrastructure securities. It requires a minimum initial investment of either $5,000, or $1,000 with a regular investment plan.

Provider of the Year – Managed Funds Australian Equities: Macquarie Investment Management

Macquarie 2020 Gold AU Release Logos

Macquarie has secured its third consecutive win for the Provider of the Year – Managed Funds Australian Equities Award in 2021.

Canstar Research said this provider has continued to excel in the domestic markets this year, including having above-market average investment returns over the past five years in the Australian Large Cap profile.

According to its website, Macquarie offers a large variety of funds to invest in across Australian and global equities, as well as fixed-income, multi-asset, and specialty asset classes.

Provider of the Year – Managed Funds Multi-Sector Funds: IOOF Investment

IOOF 2020 Gold AU Release Logos

IOOF Investment has taken out the Provider of the Year – Multi-Sector Award in 2021. This year was the first that IOOF Investment was considered for the Managed Fund Star Ratings and Awards, due to a change in the initial investment requirement (see methodology). Canstar Research said IOOF took home the Award due to its strong performance across the multi-sector profiles, including having above-market average investment returns over the past five years.

IOOF offers a wide range of investment products and access to varying levels of active management, including the option to remove parts of the management process in return for lower fees, according to its website.

If you want to know more about how the results were calculated, you can read the Managed Fund Star Ratings and Awards methodology document.

Main image source: Yuganov Konstantin/Shutterstock.com

This article was reviewed by our Sub Editor Jacqueline Belesky before it was published, as part of our fact-checking process.

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