ISA ideas: experts name a dozen funds that consistently deliver

Investment carries risk – that’s a given. But wild swings in performance are hard to stomach, even for those who are happy to take risk with their capital in the hope of greater reward.

Consistent outperformance, no matter how small, can add up to big rewards over time. With that in mind, we asked the experts to name their favourite funds that have delivered over multiple time periods.

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Janus Henderson Absolute Return

Fairview Investing director Ben Yearsley suggests Janus Henderson Absolute Return, which uses a long/short strategy and takes one-third of the market risk with the aim of outperforming the UK base rate.

“This is an extremely dull fund,” he says. “It won’t lose you $600 billion in a day like Nvidia, but it won’t make you that either. What it’s done over 20 years is give a positive return pretty much every year come rain or shine.”

The managers take both core and tactical positions. “They think pessimism around UK stocks is overdone and that M&A is a potential catalyst for UK mid-cap re-ratings,” added Yearsley.

Caledonia Investments

Peel Hunt highlights Caledonia Investments Ord (LSE:CLDN)’ history of consistent returns and progressive dividends. Over the past 10 years, it has outperformed both the FTSE All-Share index and inflation.

“It’s the top-performing trust in the flexible investment sector over five years, achieved with below-average volatility,” says research head Anthony Leatham.

The trust blends public companies with direct private equity investments and funds. Leatham points to its disciplined investment approach, experienced team and buy-to-hold approach.

“Shares currently trade on a -33% discount, but we believe Caledonia Investments is well-positioned to benefit from an improvement in risk sentiment, as well as a positive contribution from carefully selected private equity investments,” he adds.

Artemis UK Select

Legal & General Investment Management (LGIM) has held Artemis UK Select in its multi-manager funds since 2018 and its model portfolios since launch in 2021.

Its multi-asset team has conviction in lead manager Ed Legget. “We’ve followed Ed since his time at Standard Life Investments (now abrdn) and feel we understand his philosophy and approach clearly,” says LGIM manager Francis Chua.

“Ed follows a disciplined investment approach, which we’ve seen tested over different market cycles, and delivered strong risk-adjusted returns. The growth of this fund’s assets over the years is testament to its increasing popularity among fund selectors.”

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WS Gresham House UK Smaller Companies

To capitalise on the UK small-cap valuation discount at the start of 2024, Casterbridge Wealth added its sector pick – WS Gresham House UK Smaller Companies – to its core portfolio range.

The strategy focuses on high-quality, cash generative businesses with strong structural tailwinds and exhibits minimal cyclicality.

“A key reason for our choice is the team’s ability to consistently outperform the UK small-cap market,” says senior investment analyst David Winckler. “Since inception in 2019, the fund has outperformed the peer group every calendar year. Even more impressive, it has the best risk-adjusted returns.”

JPM Global Equity Income

FundCalibre managing director Darius McDermott rates the “steady, methodical approach” behind JPM Global Equity Income fund.

“This core equity income fund follows a disciplined, value-tilted approach, investing globally – including emerging markets – in large to mega-cap stocks,” he says. “Its trio of managers are focused on delivering a superior yield without sacrificing growth.”

Their “well-rounded strategy” balances compounders, high yielders and growth stocks. “With sharp risk management and a clear focus on dividend growth, they aim to provide investors with a reliable and growing income stream,” adds McDermott.

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Guinness Asian Equity Income

Interactive investor Super 60 constituent Guinness Asian Equity Income Y GBP Acc has outperformed its MSCI AC Pacific Ex-Japan benchmark in four of the past five calendar years.

“The fund takes a high-conviction, low turnover approach to investing in dividend-paying Asian companies,” says interactive investor analyst Alex Watts. “It holds 36 stocks and, somewhat uniquely, is equally weighted, reducing the risk of exposure to a single name and making for differentiation versus index.”

The managers look for companies with strong returns on capital and scope to grow dividends. “The yield of 3.9% is among the best of its peers,” adds Watts.

GS India Equity

GS India Equity I Inc GBP has beaten its MSCI India IMI benchmark in four out of past five calendar years, as well as over five and 10-year periods.

“This is a well-diversified multi-cap portfolio with a bias towards the small and mid-cap space,” says ii fund analyst Tom Bigley.

“The strategy’s bottom-up, conviction-driven investment approach has been applied consistently since its inception in 2008. Company meetings are a crucial part of the process and the team’s ability to meet companies on the ground in India differentiates it from many competitors.”

The fund is a new addition to ii’s Super 60 following the most recent annual review in January 2025.

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​​​​​​Royal London Corporate Bond

WH Ireland highlights Royal London Corporate Bond M Acc for its top-decile performance across all time periods.

“The level of outperformance is relatively small, but the compounding effect that this has over time is considerable,” says Ollie Clark, WH Ireland’s deputy head of research.

“The managers had no problem achieving this in the previous interest-rate environment and continue to do so in the current one. While absolute returns were previously nothing to write home about, this is no longer the case given where rates currently are.”

The wealth manager has held the fund in its model portfolio service since 2018.

Aegon Investment Grade Bond

JM Finn added Aegon Investment Grade Bond to portfolios around a year ago.

Fund manager James Godrich says: “It’s not often that people recommend a bond fund, but we have been impressed by the relative returns achieved by this fund in recent years.

“The fund managers are supported by a strong team of credit analysts and run the portfolio with sensible constraints.”

He reckons current positioning appears sensible. “In a world with a reasonable economic outlook, supported by strong government spending and lower interest rates, the fund looks well set for a good year of a ‘coupon clipping’ 6.5% yield without significant duration risk.”

L&G Global Infrastructure Index

If the multi-asset team at LGIM can’t find a strong case for active management, it allocates to an index fund.

For liquid and low-cost exposure to infrastructure, it uses the L&G Global Infrastructure Index, which tracks the performance of the FTSE Global Core Infrastructure Index.

“Since its launch in 2018, we’ve held the fund across our multi-asset funds and model portfolios,” says Chua. “As we’ve seen in 2024, infrastructure can deliver strong performance (a circa 20% return). Investing in this fund has allowed us to capture the strong performance of the asset class with minimal tracking error versus the index.”

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Polar Capital Global Healthcare

QuotedData highlights Polar Capital Global Healthcare Ord (LSE:PCGH), the best-performing trust in the biotechnology and healthcare sector over five and 10 years. It ranks third out of seven over one and three years.

“In the short term, it doesn’t always top the tables because its portfolio offers exposure to the broad healthcare sector, whereas some other competing trusts have a narrower focus on biotechnology, which can be much more volatile,” says James Carthew, QuotedData’s head of investment companies.

The trust operates with a fixed life and the board has started work on proposals for a corporate re-organisation in 2025, which helps to keep the discount tight.

HgCapital Trust

Alastair Laing, CEO and co-manager of Capital Gearing, the fund of funds investment trust, highlights HgCapital Trust Ord (LSE:HGT), the listed private equity fund.

“Consistent investment outcomes are achieved through a well-refined investment philosophy, deep domain expertise, and disciplined execution. A good, and rare, example of a manager that possesses all these qualities is HgCapital,” he says.

It invests in “mission critical” software and services businesses and uses its “deep expertise” to help investee companies achieve faster growth.

“The result is a portfolio of companies delivering profit growth exceeding 20% annualised, with fund returns surpassing 17% annualised over the past decade – a true masterclass in investing,” adds Laing.