Bias or otherwise in financial newsletters

Posted on 7 February 2012 by Douglas Chadwick

Bias or otherwise in financial newsletters.

Yet again a well known newsletter with a circulation of many hundreds of thousands of recipients has been advocating the benefits of investing into the Invesco Perpetual Income and High Income funds. A safe haven with one of the most successful managers in the industry. Well I do tend to agree that this has certainly been the case in the past and may be again in the future. I have held these funds myself but not so much in recent times when the performance has certainly trailed other fund managers operating in the same sector. So just to look at the facts I have looked on the Hargreaves Lansdown site to compare some of these funds over different periods of time. I have rounded the numbers for simplicity, and they make interesting reading.
 
I.P.Income                         1%    1.5%     2%    8%    35%    13%
Henderson UK income     7%    2.3%    -6%   -4%   72%   -23%
Ignis UK Equity income   10%   2.5%    -5%   -7%   42%     -5%
Troy Trojan income         2%    0.5%    1%     7%   45%     28%
Casenove UK income      5%    1.5%    1%     2%   42%     -5%
 
These numbers cover the periods one month,three months,six months,one year,three years and five years.
 
Well I would be hard pushed to come to the conclusion that Troy Trojan was not a better bet than Invesco Perpetual. Yet Troy Trojan does not get a mention. I wonder why that is the case? Also if you were an active investor and looking at your investment on a monthly basis then Henderson and Ignis must be worth consideration. So it must always be worth researching around information that you read. In this particular case the information is good but not necessarily the best.