Global equity funds have weathered both war and “insider” warnings that its overarching theme will kill us all to deliver decent returns and attract shedloads of cash. The IA Global sector has had something of a bumper year, attracting £51bn and returning 17.14% to the end of August—ahead of North America and UK All Companies, which themselves have not done badly.
When I covered the sector this time in 2025, the US had relinquished the dominant role it had held up till 2024, as the country’s mega-caps had dictated theme and pace, and US equities were suffering large redemptions globally. As a result, both thematically and geographically, global equities felt rudderless.
Wind the clock forward to today, and this has changed significantly.
The dominant theme has been characterised by AI, but broadening away from US mega-cap concentration, as strong earnings growth, record margins, and huge investments in AI infrastructure have supported equity markets and investor sentiment. This year’s Q2 earnings season was strong, which was reflected in earnings expectations, as FTSE Russell reported that upgrades were broad-based.
The US large-cap Russell 1000 returned 19.8% over 12 months, versus 27.3% for FTSE All-World ex-US. Developed Asia-Pacific ex Japan has been the standout in 2026, up 44.1% YTD in USD by August. While tech performance has recently shifted back towards hitherto shunned software—and so in turn to the US—much of the latter return has been provided by emerging and developed Asia hardware over the year, albeit with much volatility. On the downside, Chinese equities—a star market last year—have true to form gone negative over the past 12 months.
Thematically, it’s very much an AI-driven market. But this broadening leaves it feeling rather better supported—though concerns about the sustainability of this digital bull run remain: a viable technology is not the same as a viable investment proposition. Think trains in the late nineteenth century US.
I’ve tripped out sector-specific funds from the table below—specifically, financials and IT—given that these are more at home in other IA sectors, and focused on diversified global funds.
Three funds make it from last year’s cut to this: Polar Capital Artificial Intelligence, Blue Whale Growth, and SVS Aubrey Global Conviction. Remarkably, this is the case despite these three all having had a negative three months. That said, they are all ahead year to date. While first-placed Polar Capital Artificial Intelligence may seem to be a tech fund, it is diversified across numerous industrial sectors and is benchmarked to the MSCI All-Country World index, and Lipper characterises is as a global multi-cap growth fund—so it stays in the table.
These funds are all growth—a style that dominated the leaders last year—although the rest of the table is predominantly value by style. Third-placed Artemis SmartGARP Global Equity, which Lipper classifies as multi-cap value, is an example of the ascent of the style over the year, although its largest sector exposure is tech.
High energy prices resulting from the gridlocking of Strait of Hormuz shipping has boosted energy stock prices and put wind into the sails of value-tilted funds, if not the actual shipping. Another thing favouring value for the coming period could well be central bank tightening, which tends to be an environment that’s bad for growth stocks, for which it has a greater effect on the cost of capital and (at least) less bad for value stocks. Even if the Strait of Hormuz unblocks like a cork from a bottle of budget prosecco, inflationary pressures will likely take longer to diffuse.
However (as if you hadn’t noticed), the world is a volatile place, and few of the factors that have shaped the table below would have appeared on anyone’s bingo card this time last year. That uncertainty is just as unlikely to dissipate any time soon.
Table 1: Top-Performing Global Funds Over Three Years (with a minimum five-year history)
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