- AJ Bell made four changes to its Favourite Funds list in Q1 2026
- The Dodge & Cox Worldwide Global Stock fund was added to the list due to the high calibre of the Dodge & Cox business in running funds invested in undervalued stocks
- To accommodate this addition, the Schroder Global Recovery fund was removed
- In Europe, the Barings Europe Select fund was taken off the list due to underwhelming returns
- In the UK, we removed the Premier Miton Tellworth UK Smaller Companies fund following a significant decline in assets under management
Paul Angell, head of investment research at AJ Bell, comments:
“Our Favourite Funds list is under constant review to ensure we have the highest conviction in the funds we’ve selected.
“As part of this process, we analyse each fund’s investment strategy, the fund managers, and their teams. We update the list to ensure it continually consists of funds which we believe have a strong chance of achieving their investment objectives.
“Between January and March 2026, we made the decision to remove three funds from the list and added the Dodge & Cox Worldwide Global Stock fund, as detailed below.”
- Added: Dodge & Cox Worldwide Global Stock
“In the last quarter we added the Dodge & Cox Worldwide Global Stock fund to our Favourite Funds list. The fund focuses on identifying high-quality businesses that appear undervalued and offer the potential for long-term capital appreciation. The Global Equity Investment Committee managing this fund is supported by a well-resourced analyst team with a varied range of experience and backgrounds.
“The resulting portfolio is diverse, typically consisting of 80 to 100 companies, and looks different to the benchmark given the team’s disciplined valuation approach. The fund has outperformed the broader MSCI ACWI index over the five years to the end of March 2026 on a risk and return basis, and its OCF of 0.63% is competitive for active management in the sector.”
- Removed: Schroder Global Recovery
“To accommodate the Dodge & Cox addition, we made the decision to remove the Schroder Global Recovery fund from the Favourite Funds list. This switch improves diversification within our global equity selections, given the overlap of investment process and underlying holdings between both Schroder Global Recovery and Schroder Global Equity Income, with the latter fund remaining on the list. We continue to maintain conviction in the Schroder Value team and their investment approach.”
- Removed: Barings Europe Select
“In Europe, we made the decision to remove Barings Europe Select. This is due to a decline in our confidence in the team’s ability to deliver long-term outperformance versus its benchmark, the MSCI Europe ex UK Small Cap Index.
“The team follows a GARP (Growth at a Reasonable Price) approach, focusing on businesses with durable franchises by assessing competitive advantages and their sustainability over time. Whilst we acknowledge that this style has been out of favour in recent years, the scale of underperformance has been disappointing, especially when compared with peers who have fared better.
“Additionally, a recent review we conducted into customer demand across different asset classes revealed a lack of customers investing in a dedicated European smaller companies fund. Therefore, we no longer believe the asset class warrants a place on the list.”
- Removed: Premier Miton Tellworth UK Smaller Companies
“In the UK, we’ve decided to remove the Premier Miton Tellworth UK Smaller Companies fund.
“We continue to hold Paul Marriage, the fund’s lead manager, in high regard and believe his investment approach remains robust. This is reflected in the fund’s performance over the past five years, where it ranks in the first quartile among UK Smaller Companies peers.
“However, the fund has experienced a significant decline in Assets under Management (AUM), falling from approximately £510 million at its peak in 2021 to around £50 million today. Fund shrinkage such as this reduces a fund’s profitability, which in extremes, can result in a fund being closed in its entirety.
“Though this trend is consistent with broader outflows from the UK Smaller Companies sector, the reduced scale is already beginning to impact the fund. Notably, co-manager James Gerlis departed in June 2025 and hasn’t been replaced, highlighting the operational challenges associated with maintaining a fund with a low AUM.
“With the sector continuing to face outflows, we believe it will be challenging for the fund to reverse this trend. As a result, we considered it prudent to remove the fund from our Favourite Funds list.”
AJ Bell Favourite Funds explained:
The AJ Bell Favourite Funds is a list of funds across different sectors and risk appetites that have been extensively researched and selected by our in-house investments team, designed to help investors with their own investment research. The list is chosen by our investment specialists, is regularly updated, and features only funds that we believe offer a combination of a clear and robust investment philosophy and process, a proven management track record and value for investors.