Bestselling funds including those from Aviva, Artemis and Schroders that investors bought five years ago have performed dismally.

Two in three of the bestselling ISAs bought five years ago have let tens of thousand of investors down, with many losing up to half of their money.

According to Fidelity Fundsnetwork, investors poured millions into high-profile funds offered by the likes of Artemis, Aviva, Jupiter, New Star and Schroders, yet five years on they have fallen on hard times.

With investors starting to focus their thoughts on where to put this year’s ISA money, perhaps they should check whether they hold any of the ISA’s mentioned below, as it might be time to move on.

Artemis European Growth

A flagship fund for Artemis, the £201m European Growth fund has been ranked in the bottom 25pc of funds in its sector for performance over the past one, three and five years. If you had invested your £7,000 ISA allowance in 2007 it would have lost 35pc of its value and be worth just £4,579 today.

Philip Wolstencroft, manager of the fund, boasted of his “outstanding” 10-year performance numbers, although this will cut little ice with investors who bought into his story five years ago. “We will reward investors over time,” he said.

Patrick Connolly, of AWD Chase de Vere, thinks otherwise. “How much longer should people wait? This fund has been underperforming for a number of years,” he said. Mr Connolly suggested that investors should consider Cazenove European.

Aviva Property Trust

Investors couldn’t get enough of commercial property a few years ago – but they couldn’t have timed their flutter any worse. The financial crisis of 2008 saw to that. This mammoth £1.9bn fund has been one of the worst performers, with investors sitting on a 36pc loss.

Manager Philip Nell said uncharacteristically high returns in 2006 and 2007 drew investors in. “Property could not escape the economic downturn,” he said.

Robert Harley, an analyst at Bestinvest, said investors should ditch all bricks and mortar funds but hang on to funds holding property shares.

Brian Dennehy, an adviser at Dennehy Weller & Co, said investors should sell the Aviva fund. “Ironically, other funds such as Henderson UK Property [up by 4.7pc in the past 12 months] are now doing what they were always meant to do – be boring, predictable, steady. But this Aviva fund isn’t. Switch to Henderson.”

Jupiter Income Trust

This giant fund is an old favourite but it has struggled since the financial crisis. Investors who bought it would have lost 14pc of their cash, while other popular income funds have doubled investors’ money. Recent performance is significantly better, while it has beaten the FTSE All Share index in seven of the past 10 years.

Mr Dennehy reckons investors should hang fire. “We lost patience some time ago and got out. But those still on board should hold on,” he said.

Schroder UK Mid-250

“Like Arsène Wenger, we had a great five years from launch to 2005 and, as you can see from the numbers, it hasn’t won anything for the past five years,” said the fund manager, Andy Brough. “Having come through this difficult period the fund is now full of very cheap stocks and we’re convinced it will be back to winning ways this year.”

Although mid caps have suffered in the recession, one of the few Isa funds that did perform well over the past five years was rival Old Mutual’s UK Select Mid Cap fund, which would have turned your £7,000 into £7,856. That said, Mr Dennehy recommended that investors switch to JOHCM UK Opportunities fund.

New Star European Growth

New Star, headed by John Duffield, was still in its prime in 2007, but it fell from grace and was bought by Henderson in 2009. It had two big-selling Isa funds in 2007 – its European Growth fund and its UK Property fund.

The European Growth fund merged with Henderson’s equivalent fund in 2009. It has delivered a decent performance and remains a top-quartile (top 25pc of funds) performer, so advisers reckon you should stay put.

The New Star UK Property Trust became the Henderson UK Property Trust, which has lost 24pc of its value over the past five years.

Standard Life Select Property

This was the worst performer of the lot. If you had invested £7,000, it would be worth £3,616 today.

Mr Connolly simply said that investors should “get out now” and if they must stick with property, opt for M & G Property Portfolio.

But it wasn’t all bad news

Not all of the bestsellers will have disappointed. The most notable success stories have been Jupiter Merlin Income (your £7,000 is now worth £8,089), Old Mutual UK Select Mid-Cap (£7,856) and Invesco Perpetual Corporate Bond, which is now worth £8,153. And if you went against the crowd and took a punt with the BlackRock Gold & General fund you will have doubled your money. It is the best performing fund over five years, turning £7,000 into £14,298.

Source : The Telegraph

By Emma Wall