Revealed: The worst five absolute return funds over three years

It's not been around for long but the heavily hyped (by Hargreaves and others) Jupiter Absolute Return is not looking too healthy against its peer group.

I bet the Managers still collected their fancy wage packets and probably a bonus as well. Why not publish the names of these Managers so that investors can avoid them when they start up again in another fund?

i had blackrock and sold it after a poor run, now have jupiter and not impressed thus far but also have thames river hedge fund which has also been rubbish, my own stock picks with good timing and being a total amatuer include BP, Aviva, emerging markets, Mining etc have done really well this year and in the 40-50% profit range so its seems the experts are really not always worth what they charge

I'm invested in Jupiter Absolute Return, Gartmore European AR and BlackRock UK AR and they are all losing money.

There was a lot of hype about Gibbs' Jupiter Absolute Return Fund but if you looked at the risk-adjusted performance of his long-running Hyde Park Hedge Fund (on which JAR is broadly based) it was only a moderate performer relative to its peers. Gibbs has done a fine job with Fin Opps and is a very smart investor in that sector but I am yet to be convinced that he is a top global, multi-asset absolute return manager. I much prefer Littlewood's Artemis Strategic Assets and the Ruffer Total Return, neither of which charge performance fees.

I was persuaded to use Insight's Diversified Target Return fund for some quite large investments, the fund bombed-out pretty nastily through over-exposure to Tier 1 stuff in 2008. The annoying thing was, that having had a seemingly over-risky approach, they then chose to alter the funds strategy to give it a more robust strategy to meet its absolute return objectives... but they did it right at the time when the markets were turning, thus missing out on the subsequent recovery.

----in compiling this list how could Citywire forget the Capita Arch Cru "Absolute Return" Finance Fund ??

Cazenove Absolute UK also deserves to be mentioned. Again much hyped by HL only to disappoint. Down 7% since launch!!

I was encouraged by my FA to invest in Jupiter Absolute Return because of the calibre of the managing team. I am very disappointed with it's performance since launch. Also BlackRock P is looking pretty dismal at the moment. Maybe it's time for a change of funds and manager!

Absolute Marketing Hype....... But now there is a bit of time behind these funds, they seem to be falling into the traditional fund pattern of mediocre at best with a few stars. And one of the stars seems to be David Ballance who runs Ruffer Absolute Return. 47% to date over 3yrs. Pretty good Id say. Oh for hindsight. Time for me to reconsider this theme for my portfolio

Hang on a minute, Sarah, Ruffer Investment Co and Murray International are not absolute return funds - they are investment trusts in the Global Growth & Income sector, which is something else altogether. Doesn't this story just go to show you shouldn't invest in something you don't understand? Come to that, I don't understand ETFs either . . . . . .

When these funds AR were first announced, I thought pull the other one. It is just as though somebody is saying they know what the market is going to do. Actually no one knows to be so sure that they could use the word Absolute . Why are we taken in, well I am not. Such terms used in investments should be banned

Ruffer Total Return fund, beats them all

Perfectly reasonable to use the term Absolute Return because it contrasts the objective with that of relative performance funds looking to outperform equity or other indices. Problem is that when it becomes flavour of the month in marketing to retail investors (who may not have the experience to look into the critical differences between the different funds calling themselves "Absolute Return" - underlying asset class, manager aptitude and track record, fees) then there is bound to be disappointment. Not the first time, won't be the last that the flavour of the month turns out to be a sour one. Then you get the usual over-reaction (eg "such terms...should be banned").

The fact that Absolute Return performance has disappointed in its first 8 months (eg in Jupiter Absolute Return's case) doesn't mean that Gibbs can't do a decent job with this fund over a reasonable time-frame. As I said earlier, his fund was over-hyped at launch given the past performance of his hedge fund but that is not to say that the concept of his AR fund is flawed.

Lesson: do the research, don't assume infallibilty on any manager's part and don't confuse "absolute return" with "guaranteed return".

Fund Managers should be paid say 10% of the profit and pay investors 5% of the loss; as it stands the fund managers CANNOT lose. Are investors suckers?

IFA for my other pension (previous employ) insisted BR AR was the way forward in these troubled times, followed by, hang on a minute, Jupiter are launching a all new AR fund, bound to be a winner.

Guess what? I didn't invest in either. Desperate men and commision sprang to mind.

Its all hype, Anonymous 1 is correct in stating that fund managers CANNOT lose.

Anonymus 1 is correct about fund managers, they are all in a win win position irrespective of what the market does, charges are same and bonuses are also same. Investors are just suckers. When are they going to lunch new funds and hype it up as usual?

Easy - buy tomorrows FT today. You can then be a very sucessfull fund manager. Untill this bright day, watch the flying pigs?

I got into both Jupiter Absolute Return and the International Fund at launch. Gibbs looked hard to beat. Did well to begin with and moved my International holding into the Absolute Return fund when we had the big wbble at the start of the year. Decided to put more cash into Jupiter at this time rather than use the moneymarkets and to date have been disappointed but I am not sure we all understand these funds and how they work yet - The Abosolute Return holding is down 3.89% in a fairly rocky period and that is actually very reasonable [bugs me because it is my biggest holding at present], I have seen my gold funds down over 10% recently and my S&P ETF is down nearly 10% and then there is a Blue Chip like C&W (Worldwide) down 27% - After all that it may be a surprise that I am still well ahead due largely to holdings in Ruffer funds over the longer term [Total Return, European, Pacific and Baker Steel Gold]

Best examples are Newton Real Return, Standard Life GARS and CF Ruffer Total Return.

BlackRock UK Absolute Alpha has also been an excellent performer longer term, though it has stalled a bit over the last six months.

Remember not to over analyse short term performance too much, as most of the funds have an objectiove to beat a certain index (often Libor) by a set amount over a three year rolling period.

Stick to the funds with established track records to be sure they can weather a storm and be sure to research the funds management style and objectives as they differ wildly within this sector.

Also for Standard Life GARS be aware that the institutional version is identical in its make-up and performance data to the retail fund, but goes back further back to around 2006. This was originally conceived as a vehicle for Standard Life's in house final salary scheme before being released as an investment fund and has been very successful.

There is far to much hype about many very ordinary funds that become flavour of the month, usually themed, particularly by Hargreaves. I am reaching the stage where I believe nothing they print. Japan was great this week or was it last week and Odey was the bee's knees a while back.

Try Ruffer or BlueCrest Allblue.

The fund portfolio underlying BlueCrest Allblue is indeed very good from an absolute return perspective though you do have the discount/premium factor in buying the listed vehicle BlueCrest AllBlue - currently trading at around 5% premium.

Real name will be used. So be it.

I have used the Ruffer fund for many years and it has performed well and consistantly.