The average investment company fell 7% over the year to the end of April despite strong commodity and emerging market sectors, the Association of Investment Companies (AIC) reveals.
Volatility in financial markets has impacted average investment company performance over one year, but a £1,000 investment over three and ten years would be now worth 1,523 and £2,109 respectively.
The recent market turbulence has also narrowed the average investment company discount, falling from 10.6% at the start of the year to 8.5% at the end of April.
Commodities and Natural Resources was the best performing investment company sector over a year, up 31% – ahead of Global Emerging Markets, up 24%.
The Asia Pacific and Global Emerging Markets sectors shared supremacy over three, five and ten years. Asia Pacific was the best performing sector over both five and ten years, up 447% and 485% respectively – while Global Emerging Markets dominated over three years, up 150%.
Even though the Financials sector dropped 25% over the last year, it finished third and fourth best over three years and five years.
AIC communications director Annabel Brodie-Smith says the recent results are not surprising considering the record oil prices and the commodity boom.
“It’s interesting to look at the top performing sectors but these figures clearly illustrate the importance of taking a long-term view and having a balanced portfolio with exposure to a variety of different sectors and countries,” she says.
“If investors are worried about investing in volatile markets they should consider regular investing which helps smooth out the highs and lows in the prices of shares, so they do not have to worry about market timing.”IFAonline
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