Target return funds fall short

Over half of the target return funds available to private investors have failed to meet performance goals over the past year. Research from BestInvest analysed the five vehicles with one-year track records, and three fall short of their annual targets; Baring Directional Global Bond, Credit Suisse Target Return and UBS Absolute Return Bond. Each of these delivered between 4% and 4.8% after charges, despite targeting Libor plus at least 2% before charges. This would have required a return of at least 6.5%, based on current interest rates. The only portfolios to meet their targets, using...