Consistency is an underrated skill in investment. The glory tends to go to those who shoot the lights out in an individual year, even if they don’t maintain momentum afterwards. Those who deliver steady returns year after year don’t tend to attract the same attention. However, they may be better for your wealth over the long term.
Please remember that the value of investments will fluctuate and returns may be less than the amount originally invested. Tax treatment depends on your individual circumstances and tax rules can change. Chelsea does not offer advice and so if you are unsure of anything please contact an expert adviser.
Why consistency matters
First, there is the simple maths that a fund manager needs to work harder to recover from losses. If a fund manager loses, say, 20% in a single year, they need to gain 25% to get back to their previous level. It is better for your long-term wealth to gain 10% one year, and 10% the next, than gain 30% in one year and lose 10% the next.
It is also important in keeping you invested. While some brave investors can white-knuckle ride through turbulence, many more may get spooked and sell out. History suggests that investors tend to do this at exactly the wrong moment, denting their future returns. Investing with a manager that shows consistency may avoid the emotional highs and lows that prompt bad decision-making.
Consistency may be a particularly important metric on which to judge fund managers in the current environment. Looking at cumulative past performance measures is likely to give you a handful of funds that have been significantly exposed to the AI trade. In 2023 and 2024, half the return in the S&P 500 came from just a handle of mega-cap technology stocks*. This changed a little in 2025, but investors could still lean on the US technology sector to deliver growth.
Market leadership is starting to widen out. Markets such as the UK, Europe and emerging markets all outperformed the US in 2025**, particularly once investors adjusted for the weakness in the dollar. There are reasons to believe this is likely to continue: a growing disillusionment with US assets, worries over the disruption created by the AI trade, potentially lower interest rates and greater government spending, from the ‘One Big Beautiful Bill’ in the US, and rising defence spending in Europe, are all likely to expand investors’ horizons beyond big tech.
Looking at whether a fund manager has delivered returns consistently is more likely to identify those that are able to navigate a more complex environment.
The importance of income
True consistency is hard for any equity manager to achieve. Stock markets rise and fall. Even the best fund managers will go through periods when their approach is out of favour. It doesn’t help that those investment styles that have historically been more consistent and defensive, such as targeting the highest quality companies, haven’t fared that well at a time when artificial intelligence has been the dominant trade.
Nevertheless, some factors stand out among the more consistent funds in the Chelsea Selection^. The first is that income is a vital contributor to consistency of returns. There are more consistent funds to be found in the Global Equity Income and UK Income sectors than any other area***. Income funds have generally dropped less during periods of weakness and yet maintained growth during periods of market strength.
Many lost relatively small amounts in the market rout of 2022. Equally they have responded well to a shift in market leadership in 2025. The Aegon Global Equity Income fund, for example, dropped just 1% in 2022, rose 14.3% in 2025 and is still ahead for the year to date in 2026***. Manager Mark Peden has been invested in out-of-favour areas, such as healthcare and US consumer stocks. His exposure to technology has been notably lower than his MSCI ACWI benchmark and currently sits at 21.6%****.
Artemis Global Income, M&G Global Dividend, JPM Global Equity Income and Fidelity Global Dividend can claim a similar return trajectory. In each case the dividend has helped support overall return and cushioned stock market volatility for investors.
In the UK, Fidelity Special Situations and Artemis Income protected their investors from the worst falls in 2022, but have both delivered strong returns since, even though the UK has been a difficult market. Jupiter Asian Income is also worth a mention. It has had one down year, 4.24% in 2018, but strong returns ever since***. Certain sector funds have also shown themselves to be defensive in tougher times. Polar Capital Global Insurance and FTF ClearBridge Global Infrastructure Income have maintained consistent returns, having lost capital in only one and two of the past ten years, respectively***.
Finding the right blend
Investors can also generate consistency with the right blend of assets. Bond funds are often included in portfolios to balance out stock-market risk. However, 2022 was a tough year for many bond funds. It is difficult to find any bond fund that didn’t see double-digit losses in what proved to be an annus horribilis for fixed income markets. An honourable mention goes to the Jupiter Monthly Income Bond fund, where skilled stock picking and a focus on short-dated bonds minimised losses for investors***. In the aftermath of 2022, when global interest rates were reset, bond funds have generally been more consistent since.
Nevertheless, the recent performance of bond markets should give investors pause for thought. It used to be that if bonds were doing badly, stock markets would do well, and vice versa. However, in recent years, bond and equity markets have moved in tandem, in response to significant changes in interest rates. For flexible multi-asset managers, this has necessitated a change of approach.
On the VT Chelsea Managed range of funds, we have drawn on alternative areas, rather than relying on a simple bond and equity allocation to provide diversification. That includes some hedge fund holdings and other uncorrelated funds such as TRIUM Alternative Growth or Biopharma Credit. We’ve also incorporated gold as a strategic long-term asset.
We have sought to defend portfolios against geopolitical tensions by adding to our oil and mining positions. This has helped offer some protection against the volatility created by US and Israeli incursions in the Middle East. None of these assets are consistent by themselves, but blending them helps to deliver consistency.
Read more: Positioning the VT Chelsea Managed funds for turbulence
In volatile times, consistency may be just what you need to stay invested. You can generate consistency by picking the right funds, or by blending a range of assets successfully. It may be dull, but it can be a powerful tool in generating long-term wealth.
