Return Of Mutual Funds In Spain, 2000-2015
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University of Navarra – IESE Business School
University of Navarra, IESE Business School
University of Navarra
January 22, 2016
The average return on investment funds in Spain in the last 15 years (1.90%) was lower than investment in government bonds to 15 years (5.4%) and investment in the IBEX 35 (4.6%). Only 18 of the 632 funds with 15 years had a higher than government bonds to 15 years profitability. The most profitable fund provided in the last 15 years to its shareholders a total return of 542% (average 13.2%) and the least profitable of -64.7% (average -6.2%). Section 2 provides a ranking of the 49 investment fund companies as the average return of their funds.
Note: Downloadable document is in Spanish.
Return Of Mutual Funds In Spain, 2000-2015 – Introduction
This paper analyzes the profitability delos Spanish investment funds to its shareholders in the last 15 years (Dec. 2000-Dec. 2015)
1. Profitability of investment funds in the last 15 years
Figure 1 shows the summary of the profitability of Spanish investment funds 15 year history (632 funds that existed in December 2000).
In the period December 2000 – December 2015, the average annual return on the IBEX 35 was 4.62% (total yield 97%) of government bonds to 15 years 5.40% (120% total return) and 632 funds of 1.90% (32.67% total return). Figure 1 shows that:
- Only 18 funds (of 632) exceeded the return on government bonds to 15 years1
- Only 27 funds (of 632) outperformed the IBEX 352
- 82 of the 632 funds had a negative average return!
The most profitable fund provided in the last 15 years to its shareholders a total return of 542% (average 13.2%) and the least profitable of -64.7% (-6.7% average). One euro invested in 2000 the most profitable fund, became 2015 € 6.42 while invested in the fund less profitable He became € 0.35.
Table 1 shows the performance of mutual funds in Spain in the last 15 years grouped according to the categories established by INVERCO. For example, the assets of the 39 funds category “National Variable Rent” was EUR 3.112 million at the end of 2015. The average return of these funds over the past 15 years it was 3.1% (but provided a background and another 11.9% -1.1%). The dispersion of returns within each category (see column “st dev”, “MAX” and “min”) is because investment decisions of the managers, to the level of charges, the volume of purchases and sales background (“active management”) and the investment philosophy of the fund. Table 2 shows the most profitable and least profitable funds.
Figure 2 shows little relationship between profitability and shareholders’ funds. The Figure 3 shows little relationship between profitability and the number of participants in the funds. The Figures 4 and 5 show other characteristics of the funds in Spain.
Studies on profitability models funds
The most complete study is Palacios and Alvarez (2003) who studied the profitability of funds Spanish investment in equities for two periods: 21 funds 1992-2001 and 55 funds from 1997 to 2001. In the period 1992-1901, in the middle of the IBEX 35 ITBM and annual returns were 16.3% and 15.1%, the average return of the 21 funds was 10.7% and funds with higher returns (BSN Banif Acc. Spanish and Citifondo RV) had average returns of 14.8% and 14.6%. In the period 1997-1901, in which Tax & stockings and IBEX 35 annual returns were 15.9% and 12.4%, the average return of the 55 funds was 8.3% and most profitable funds (Chase Bag Plus and Bolsacaser) had returns averages of 14.2 and 13.7%. According to Palacios and Alvarez (2003), the average of the middle management and annual fees deposit in the period 1997-1901 was 2.41%.
Lucas (1998) compare the performance of 36 equity funds in the 1992-1996 period with the Ibex 35 (excluding dividends). The comparison is wrong by not including dividends in the index, but De Lucas (1998) concluded that 11 funds improved the performance of the index. In the period 1992-1996, in which Tax & stockings and IBEX 35 monthly returns were 1.42% and 1.39%, the fund with the highest return (Fonventure) earned an average monthly return of 1.80%. Others 4 more funds had a return ITBM above.
Ferruz, Marco Sarto and Vicente (2004) compared the performance of 40 equity funds or mixed income the period 1995-2000 with the General Index of the Madrid Stock Exchange (excluding dividends) and concluded that 16 they had a higher yield IGBM. However, the 40 funds had a return lower than the ITBM and the IBEX 35 (adjusted for dividends) in the period from 1995 to 1900, when returns quarterly averages of ITBM and IBEX 35 were 6.9% and 6.5%, the fund with the highest return (Citifondo RV) He obtained an average quarterly return of 6.0%.
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