Top 10 most-bought investment funds: October 2024

One new entry in the top 10, but what of Fundsmith Equity?

1st November 2024 09:24

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Fundsmith Equity, the flagship £22.7 billion global equity fund of star manager Terry Smith, has once again fallen outside the top 10 list of monthly most-bought funds, according to the number of buys among interactive investor customers.

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Fundsmith Equity returned to the top 10 funds’ list in September, having fallen out of it in August for the first time since 2018 (when ii began monitoring its most-bought investments).

In a recent interview with interactive investor, Smith addressed the short-term performance woes of his growth fund, which appears on ii’s Super 60 list of investment ideas. He explained how not owning chip stock NVIDIA Corp (NASDAQ:NVDA) has been a drag on performance.

In terms of the recent past, our Q3 review of ii’s Super 60 funds found that “weakness in the IT sector and parts of the communication services sector dragged [Fundsmith Equity and others] into negative territory” over the quarter, while there “were also negative impacts from growth stocks within healthcare”. Fundsmith Equity counts Novo Nordisk AS ADR (NYSE:NVO) among its top 10 holdings, for example.

This week, on ii Community, interactive investor’s new app, one user asked investors which “star fund manager” they prefer: Terry Smith or Nick Train, the manager of Lindsell Train UK and global equity portfolios. Smith won!

Interestingly, none of the funds/investment trusts the pair manage currently appear in the top 10 lists of the most-bought funds and trusts in October, although in the past both managers have delivered very good long-term results for investors.

Fundsmith Equity’s exit from the top 10 allowed Vanguard US Equity Index to join our ranking, in 10th place and meant that asset manager Vanguard’s funds comprise half the top 10 table. The Vanguard US Equity fund gives investors access to more than 3,500 American companies for a 0.1% annual fee.

Three of Vanguard’s LifeStrategy Equity funds feature in the top 10, namely 80% Equity unchanged at the top of the table since last month, 100% Equity, up two in seventh place, and 60% Equity, down three in eighth place. These low-cost multi-asset funds are widely held among ii investors, as they are a “one-stop shop” for those seeking exposure to global equities and bonds.

In an article on “set and forget” funds, specialist writer Cherry Reynard recently named Fidelity Index World, in sixth place in this month’s top 10,as one“cheap and well-run” MSCI World tracker that gives “access to a range of geographic regions and sectors”.

Other global trackers that made the top 10 in October include HSBC FTSE All-World Index (joint fourth place)and Vanguard FTSE Global All Cap Index (ninth place).

However, these funds are all different, with some including emerging market exposure and others not. As with any fund, it’s vital to check what exposure you’re getting before you buy.

Royal London Short Term Money Market held on to second place.The returns ofthefund are closely linked to the interest rate set by the Bank of England. So, with interest rates beginning to drop, the returns on money market funds will also start to head down.

“Investors have been captivated by India,” wrote abrdn’s James Thom in a recent article.The country is certainly popular among ii customers, with Jupiter India in joint fourth place in our top 10 list. Columnist Ian Cowie just this week wrote how he thinks “India stands to gain from rising tensions between America and China, prompting major exporters to transfer production from dictatorships to democracies”.

Finally, up one place to third,the performance of L&G Global Technology Index continues to impress, although this fund is highly concentrated, and investors could come a cropper should tech suffer a sell-off.

Top 10 most-popular investment funds in October 2024

Position	Fund	IA sector	Change on last month	One-year return (%)	Three-year return (%)
1	Vanguard LifeStrategy 80% Equity	Mixed investment 40%-85% shares	No change	18.92%	14.41%
2	Royal London Short Term Money Market	Short Term Money Market	No change	5.38%	10.99%
3	L&G Global Technology Index	Technology	Up one	41.11%	49.38%
=4	Jupiter India	India/Indian Subcontinent	Down one	35.55%	74.98%
=4	HSBC FTSE All-World Index	Global	Up one	25.59%	28.10%
6	Fidelity Index World	Global	Up two	26.46%	28.30%
7	Vanguard LifeStrategy 100% Equity	Global	Up two	21.86%	22.76%
8	Vanguard LifeStrategy 60% Equity	Mixed investment 40%-85% shares	Down three	15.93%	8.83%
9	Vanguard FTSE Global All Cap Index	Global	Down two	23.38%	22.23%
10	Vanguard US Equity Index	North America	New entry	28.52%	30.40%

Source: interactive investor. Performance data to 1 November 2024. Note: the top 10 is based on the number of “buys” during the month of October.

These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

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