You are here: Home - Saving & Banking - News -

Portfolio turnover nears two year mark

0
Written by:
28/04/2008

Stocks in UK unit trusts and Open-Ended Investment Companies (OEICs) are typically held for just less than two years, according to Lipper.

Data from the financial research organisation shows the average annual portfolio turnover for actively managed equity funds is 56.6%. This indicates how actively each fund is managed, according to Lipper, by measuring the level of buying and selling of the underlying investments. Such activity is also a key driver of trading costs.

Looking at specific sectors, UK-focused funds have tended to hold investments for longer, with a portfolio turnover of 54.7% recorded for the UK all companies sector, 43.6% for UK equity income and 43.6% for funds in the UK smaller companies sector.

Japanese-focused funds had the highest turnover levels, with 84.6%, followed by those investing in North America (81.2%) and Europe ex UK (79.2%).

Ed Moisson, Lipper’s Director of Fiduciary Operations in Europe, said: “While investors should be aware of a fund’s investment objectives, they should not assume that all funds in one sector are managed in the same way. For example, some aggressive funds are traded more frequently, while others just concentrate on a small portfolio of holdings. So turnover can be a crucial part of establishing whether the fund is doing ‘what it says on the label’.”

He continued: “Disclosing portfolio turnover in a meaningful manner can help investors understand how actively their fund is being managed and the potential impact on trading costs.”

Tagged:

Tag Box

Debt

Pension

Spending

Financial fitness

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Which ISA is right for you? A round up of the six products available in 2017

From cash to innovative finance to lifetime, here's our guide to the ISA products available to savers this yea...

Guide to buy-to-let tax changes

In late 2015, former Chancellor George Osborne announced a range of  tax measures aimed at landlords, which t...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Five fund tips for a 0.25% interest rate environment

With interest rates stuck at a record low 0.25% and expectations rates could fall to close to zero, here are ...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Investing your money

Alliance Trust Plc gives you smart insight into how to invest your money

Money Tips of the Week

Read previous post:
Private banking not so inaccessible

If they had the money, 24% of people would switch to a private banking service according to recent research from...

Close