Trustnet Magazine 54 September 2019 | Page 44

Data hub 44 x / x 45 Crunching the biggest trends down into figures 175.02% Volatility: A double-edged sword Someone who invested in the MSCI World index at its pre-financial crisis peak would have seen a maximum drawdown of 37.9% and would had to have waited 2 years and 5 months to get their money back Someone who invested in the IA Targeted Absolute Return sector at its pre-financial crisis peak would have seen a maximum drawdown of 7.89% and would had to have waited 1 year and 3 months to get their money back 49.58% But... 29.15% Return of IA Targeted Absolute Return sector since pre-financial crisis peak Return of MSCI World index since pre-financial crisis peak of the FTSE All Share’s 10 best days this century came during the financial crisis FE TRUSTNET 4 of the 5 best performers in the IA universe over 10 years are in the bottom quartile for suppressing volatility – maximum drawdown of Marlborough Special Situations, the best- performing fund in the IA universe over 20 years. It has made 1,895.93% over this time MFM Junior Gold, the fund with the worst score for suppressing volatility in the IA universe over 10 years, also made the worst return, at -61.43% Investors in the IA Japan sector at its peak in December 1989 would still have been in negative territory more than 24 years later 11 – the number of sectors in the IA universe that have made a negative return for investors over a period of at least 10 years Sources: FE Analytics, JP Morgan trustnet.com