Charles Stanley Direct is an investment platform where you can buy a wide range of funds, shares and other types of investment in a variety of accounts: a tax efficient Stocks & Shares ISA, Self Invested Personal Pension (SIPP) or Junior ISA, and a standard Investment Account which doesn’t come with any tax benefits.
Funds or Shares?
Lots of clients like to pick their own shares from UK and international markets, though this can be risky without sufficient diversification – spreading money around enough different companies across various geographies and sectors – or the knowledge and time to study companies closely.
Funds are a great option for investors happy to be a bit less hands on. These ‘collective’ investment vehicles own a slice of lots of different companies which help to spread risk. They can either be broad, covering global markets, or more targeted, focusing on a single market, sector, company type, or specific attributes.
Funds are either managed by a professional fund manager (in the case of ‘active’ funds) or designed to simply track a particular index (in the case of ‘passive’ funds or ‘trackers’). While it can be a challenge to devote enough time to monitoring a portfolio of individual shares, it’s a lot easier to keep tabs on a portfolio of funds.
Using funds means you can easily invest across a range of asset classes, which can help reduce portfolio volatility (the market ups and downs) while still aiming to generate decent returns. Alongside equity and bond funds there are more specialist investments in areas such as property, infrastructure assets or commodities.
There are two main types of funds - Unit Trusts and OEICS – which are categorised by the Investment Association into 45 different sectors, which defines the areas in which they can invest. This means investors can more easily identify funds that might meet their needs and compare them with each other.
Find out more: Why funds are a great investment shortcut
What makes a popular fund?
Some funds become very popular with investors. In active funds, strong past performance or the ‘star’ status of a particular fund manager can draw interest. Investors shouldn’t get carried away and devote too much of their portfolio to a single manager or asset management company, though – no matter how convincing their pitch or impressive their past performance has been.
Remember, past performance is not a guide to the future. All active managers can experience periods of underperformance which can often crop up after strong periods of returns. In addition, evolving circumstances may mean that there are changes at the top or within the support team that has an impact on the returns generated over time.
For passive investments, the most popular funds tend to be ones with the low charges in their respective areas. It is a competitive landscape – the greater the size of the fund, the more keenly priced fund groups can be. However, older passives can sometimes be uncompetitive by today’s standards so check older products carefully.
Which funds are popular with our clients?
The following funds are the top five most popular purchases (by number of trades) made by our clients in the month of July 2025. Remember, although certain funds have been popular, this does not imply that you should follow suit. This list is for information only and any investment you choose should meet with your own personal circumstances and objectives, taking into consideration your existing portfolio.
Investment decisions in fund and other collective investments should only be made after reading the Key Investor Information Document or Key Information Document, Supplementary Information Document and Prospectus.
Fidelity Index World
This passive investment offers low-cost access to global share markets. The investment objective is to track the performance of the MSCI World Index before costs. This index captures large and mid-sized companies from more than 12 developed countries.
This benchmark currently reflects the dominance of the North America in the companies and sectors that feature most prominently. Over 70% of the fund is currently invested in the US, and the biggest holdings are in line with a US equity market tracker – Nvidia, Apple, Microsoft, Alphabet and Amazon.
A global tracker fund like this could be worth considering for the ‘core’ of a broad portfolio. Using funds like this with very low costs for broad market exposure can translate to higher returns, especially over the long term. A big attraction is the low annual charge – 0.12% as measured by the ongoing charges figure (OCF) – a major reason why the fund is part of the Charles Stanley Direct Preferred List – the list of fund ideas for new investment from across the major sectors compiled by our Research Team.
Vanguard LifeStrategy 100% Equity
Another passive strategy, this fund is a package of Vanguard index funds tracking different markets around the world. In the case of this particular product, it’s exclusively shares – also known as equities – rather than bonds hence the fund name.
The most significant difference between this fund and a standard global tracker fund is the much larger weighting to the UK at around 25%, representing additional ‘home bias’ for UK investors. The UK is only around a 4% weight in the MSCI World Index, the commonly used benchmark for the global sector. It will therefore tend to lag a fund like Fidelity Index World when the UK underperforms but beat it when that market is in vogue.
Vanguard LifeStrategy 80% Equity
LifeStrategy funds invest in a variety of Vanguard's index trackers, providing access to thousands of international stocks and bonds across the major markets to create a very diverse portfolio in a single fund.
This fund offers a straight-forward, diversified access to global equity and bond markets, automatically rebalanced to maintain the specified asset allocation of 80% equities and 20% bonds – often considered a ‘balanced’ approach for the longer term. This keeps the risk level the same over time and saves the investor re-balancing the weightings of various areas themselves, which is especially relevant for those with smaller portfolios wanting to gain significant diversification.
As well as being simple and convenient, charges are also competitive with the OCF of just 0.22% for each fund in the Vanguard LifeStrategy range.
Fundsmith Equity
Managed by well-known manager Terry Smith, this fund seeks to outperform global stock markets by investing in high-quality companies that can reliably grow their earnings over time with the mantra: “it’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price”.
Relatively few companies meet the manager’s stringent criteria for quality, which results in a concentrated portfolio of large, global businesses that have a high return on the capital they invest and good conversion of profits into cash flow. Smith tends to be attracted to businesses whose advantages are difficult to replicate through brand names, high market shares, patents, licenses, distribution networks and customer relationships. With these sorts of attributes, he believes businesses can consistently outperform competitors.
Since launch in 2010 the fund has outperformed its global benchmark by a wide margin, fuelled by strong stock picking, but the past five years have been more difficult – largely due to the meteoric rise of some of the large technology companies the manager hasn’t held. While the fund remains popular with many investors, assets under management have been in decline for the past year, revealing that sales of units in the fund are greater than new purchases over this period.
Artemis Global Income
This fund invests internationally in dividend-paying shares with the aim of providing a growing income stream with capital growth on top. Alternatively, for those not seeking income, the fund can provide some diversification to funds dominated by the large ‘growth’ companies that dominate global trackers or funds purely seeking growth.
Managed by Jacob de Tusch-Lec since inception in 2010, and by James Davidson from 2018, the fund dares to be different from many dividend-focused funds that tend to prioritise stable areas such as consumer goods and utilities. A core of more mature dividend stalwarts is balanced by a blend of businesses in more economically sensitive sectors or areas that are out of favour with investors. This leads to a broad, pragmatically constructed portfolio influenced by the economic picture as well as analysis of individual companies.
Recently, this has led to a large position in banks and financials, which the managers consider to be resilient to high interest rates, and around 15% in defence stocks which rallied strongly following news of increased spending across Europe.
It is a testament to the manager’s process that not only have the fund’s income payouts increased handsomely over time, but overall returns have beaten the benchmark MSCI World since launch fifteen year ago. Given the dominance of low yielding but strong performing tech stocks in the index, which the fund has had little exposure to, this is an impressive feat – although past performance is not a reliable guide to the future. The fund has been part of the Charles Stanley Direct Preferred List since July 2015.
Nothing on this website should be construed as personal advice based on your circumstances. No news or research item is a personal recommendation to deal.
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