Growth enters fifth month of positive returns

Growth funds are beginning to reward the faith some investors have placed in them after the median fund experienced five successive months of positive returns, following a 2.2 per cent for July,InTechrevealed today in its Growth Funds Survey.

However InTech senior consultant Corrin Collocott, referring to losses investors have suffered over the past two years, says the positive returns may not be enough for some investors.

With a return of 3.3 per cent for the year ending July 2003, the median growth fund has also returned its first positive rolling one-year return since April 2002.

All managers in the InTech Growth Universe delivered positive returns for July, withSagitta Rothschildthe top-performing manager with 3.2 per cent return for the month. In second place was value managerTyndallwith 2.9 per cent, closely followed byHSBCwhich also returned 2.9 per cent.

Others in the top five wereIOOF/Perennial, which coincidentally returned 2.9 per cent, andInvesco(2.8 per cent) - all of which had a significantly higher exposure to shares compared to their competitors.

According to InTech, the performance in July was driven by a return from the Australian share market of 3.2 per cent for the month, another fifth positive monthly return, which resulted in a return of 4.8 per cent over the three months to July.

The continued rebound of international share markets was also a factor, with a return of 2.8 per cent for the month, bringing the quarterly return to 9.6 per cent for international markets. While the arrest of the Australian dollar’s rise during July boosted returns for unhedged investors in international shares, returning 5.6 per cent for the month.

Also affecting the results was the rise of bond yields across the globe, resulting in negative returns from Australian bonds, down 0.9 per cent for the month, and international bonds down 1.8 per cent in local currency terms.