Savers picking funds in AE are better off, research shows

The investment house found the average performance of the top 10 funds picked by savers outperformed default funds by 4.7% over one year, 5.58% per year over three years, and 4.86% per year over five years. Hargreaves conducted research into the fund choices made in more than 300 auto-enrolment schemes, covering almost 80,000 members. It said the outperformance can be attributed to the increased risk that the choosers tend to take on, as default funds tend to be lower risk in their makeup in an attempt to cater to all. It said it can also be attributed to active management, which a...