UK vehicles from the likes of Newton, Majedie, JO Hambro and Invesco Perpetual have all been given the highest scores for overall performance and low volatility in wealth manager Rowan's latest Making the Grade report.
The report, which assesses the whole raft of UK funds in the All Companies, Equity Income and Smaller Companies sectors, is built upon three-year bid-to-bid Financial Express performance data to 1 December.
In addition, an 'A' to 'F' grade has been assigned to each fund reflecting a number of factors relating to its performance, such as volatility and the ability to generate absolute returns.
Two grades have been awarded, accounting for performance over both three years and one year (with a skew towards the past six months).
In the UK All Companies Sector, a total of seven funds achieved either an 'A' or 'A-' grade over both categories.
These include John Wood's JOHCM UK Opportunities fund, Newton's UK Opportunities and Growth vehicles, Majedie UK Equity and UK Focus, and the Ben Whitmore-led Jupiter UK Special Situations fund. All of these are ranked in the top 10 best performing funds over three years according to Financial Express.
Near the bottom of the list - and graded 'F' for both short and long-term performance - is New Star UK Growth and Select Opportunities funds and Carl Stick's Rathbone Special Situations fund.
Neil Woodford topped the performance rankings in the UK Equity Income sector over three years with his Invesco Perpetual High Income fund. He also achieved a perfect double 'A' grade for the mirror fund he runs on behalf of St James's Place.
There was a lower average grade awarded in the UK Smaller Companies sector which is understandable given that no fund here has achieved a positive return over three years.
Douglas Brodie's Baillie Gifford British Smaller Companies fund and Marlborough UK Micro Cap Growth, run by Giles Hargreave, both achieved grades of 'A-' in the short term and 'B-' over the longer period.
Tim Cockerill, Rowan's head of research, says: "What surprises is that there is a high level of consistency being shown in the performance of these 'A' grade funds. In fact, while the numbers don't look good, there is more consistency in these market conditions than we had in the bull market."
Cockerill adds that those funds that are performing consistently well have generally taken a defensive position early, which is why they have preserved more value than most.
He adds: "That is what gives them the good longer-term grade, and the good short-term grade is because they are still maintaining that defensive position, which has been fairly important in these markets.
"What the short-term grades also tell you is that there is not a lot of light at the end of the tunnel for those funds at the bottom of the list. Those funds with 'E' and 'F' grades for the short-term and long-term haven't shown much signs of improvement."IFAonline
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