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The ten cheapest funds on FundCalibre
The active vs passive investment debate has divided the investment world for years, with proponents for each side regularly arguing the pros and cons of one versus the other.
For those new to investing, here is a brief description of each:
Passive investments will match an index like the S&P 500 or the FTSE 100 – investing in them like for like. They are generally automated, with some oversight from a human, and usually quite cheap to buy.
Active investments are funds run by investment managers who don’t try to match an index – they try to beat it by selecting investments they think are best based on their own research. They tend to be more expensive as you are paying someone for this extra research and management.
FundCalibre’s stance
At FundCalibre, we are clear fans of the active approach. But we acknowledge that not all actively-managed funds are good and even the best fund managers will have an ‘off’ spell.
That’s why our proprietary screening tool AlphaQuest strips out the market movements reflected in a fund’s performance to see how much value a fund manager actually adds and how consistent they are in doing so.
Only those funds that pass the AlphaQuest test go on to the second stage of our ratings process and potential get an Elite Rating.
And, while no one wants to be paying over the odds for an investment, for us, it’s performance returns after fees that are important. Sometimes it is worth paying a bit more for better results.
What if you could get the best of both worlds?
That said, the cost of a fund can have a big impact on returns. So, what if you could have the best of both worlds?
Below we list the 10 cheapest funds on FundCalibre. Each fund charges an ongoing annual fee of 0.51% or less. This means, for every £10,000 invested, you are paying the management company £51 per year to invest on your behalf.
| Rank | Fund/Trust name | Ongoing charge (%)* | Cost per annum of £10,000 invested |
| 1 | Scottish Mortgage Investment Trust | 0.34% | £34 |
| 2 | City of London Investment Trust | 0.36% | £36 |
| 3 | Baillie Gifford High Yield Bond | 0.37% | £37 |
| 4 | Artemis Corporate Bond | 0.39% | £39 |
| 5 | Artemis Target Return Bond | 0.40% | £40 |
| 6 | M&G Strategic Corporate Bond | 0.41% | £41 |
| 7 | M&G Corporate Bond | 0.41% | £41 |
| 8 | AXA Sterling Credit Short Duration Bond | 0.42% | £42 |
| 9 | Invesco Corporate Bond | 0.50% | £50 |
| 10 | Baillie Gifford American | 0.51% | £51 |
*Source: FE fundinfo, 15 September 2021
This article is provided for information only. The views of the author and any people quoted are their own and do not constitute financial advice. The content is not intended to be a personal recommendation to buy or sell any fund or trust, or to adopt a particular investment strategy. However, the knowledge that professional analysts have analysed a fund or trust in depth before assigning them a rating can be a valuable additional filter for anyone looking to make their own decisions. Past performance is not a reliable guide to future returns. Market and exchange-rate movements may cause the value of investments to go down as well as up. Yields will fluctuate and so income from investments is variable and not guaranteed. You may not get back the amount originally invested. Tax treatment depends of your individual circumstances and may be subject to change in the future. If you are unsure about the suitability of any investment you should seek professional advice. Whilst FundCalibre provides product information, guidance and fund research we cannot know which of these products or funds, if any, are suitable for your particular circumstances and must leave that judgement to you. Before you make any investment decision, make sure you’re comfortable and fully understand the risks. Further information can be found on Elite Rated funds by simply clicking on the name highlighted in the article.
