The number of persistently underperforming funds has increased by more than a quarter in the last six months to 56, according to Bestinvest’s latest Spot the Dog report, with St James's Place dominating the list of big funds.

It said the dog funds identified hold £46.2bn of investors’ wealth – more than double the £19.1bn recorded in February.

Bestinvest classifies funds according to underperformance relative for their relevant indices over three consecutive 12-month periods and by 5% or more over the three years.

Jason Hollands, Managing Director of Bestinvest, said: “For three decades, Spot the Dog has named and shamed consistently underperforming investment funds to help investors take stock of their portfolio. The purpose of the guide is to encourage investors to keep a closer eye on their investments, not only to check how their investments are performing but also to assess what action is required and when.”

The latest survey named St James’s Place as having more than half of the total dog fund assets. SJP accounted for £26.05bn or 63% of the total dog fund assets featured in the survey.  

Five SJP funds featured in the top ten big funds, with its Global Quality, Global Growth, International Equity and European Progress strategies landing in the top four spots, respectively, according to assets under management. The firm's Global Emerging Market fund was tenth on the list.

The other five spots in the top ten worst funds, in AUM order, were taken by Scottish Widows UK Growth; Artemis US Select; Columbia Threadneedle Responsible Global Equity; abrdn UK Smaller Companies and Troy Asset Management Trojan Income.

Tom Beal, director of investments at St James’s Place, said: “It’s important to note that the performance of these funds is inclusive of our single ongoing charge which includes the cost for the external fund manager, administration and advice.

“We continually monitor, review, and update our investment proposition to make sure we’re delivering the right outcomes for our clients. In the past two years four of the funds mentioned have undergone a change in manager and performance benefits of these changes will take time to filter through.”

Mr Hollands said: “Every fund manager will go through weaker periods – whether that is a run of bad luck, or they are sticking to a style or process that may be temporarily out of fashion. Identifying whether these are short-term or structural factors is key.”

He highlighted that Invesco, which had dominated previous editions of the report, no longer had any funds in the list.

Top 10 biggest beasts by size  

Source: Spot the Dog, August 2023 

*Performance figures shown are net of fees with income reinvested.