A fund manager, multi-asset manager, fund picker and economist each picked a graph to show the difficulties and benefits of investing in this asset class amid a new market cycle and shifting trends within this part of the market.
Trend funds versus allocation funds in 2022
Matias Mottola, director of manager research, Morningstar
At Morningstar, we do not focus too much on return statistics, as they provide a backward-looking view of the world. But the success of trend-following funds in 2022 compared with moderate allocation funds is something worth pointing out. Since the early months of the year, equity and bond markets have mostly been on a losing trend, while commodity prices have shot up on the back of the Ukrainian war. This has meant painful losses for many popular strategies. But for trend funds it has been a perfect environment to prove their worth as a provider of diversification in difficult times.