Global tracker funds are widely used as low-cost building blocks in portfolios, offering broad market exposure with minimal intervention required.
Yet they are leave investors more concentrated than expected – particularly to US mega-cap tech and AI stocks – making portfolios heavily reliant on a narrow group of companies.
Adding complementary strategies can introduce different drivers of return and smooth performance across market cycles, so Trustnet asked a range of fund selectors which strategies they believe pair most effectively with global tracker funds.
Rob Morgan, chief analyst at Charles Stanley, said the best funds to complement a core global tracker are those with significant differentiation and an active mindset. As such, he suggested the £807.7m JOHCM Global Opportunities fund.
He said FE fundinfo Alpha Managers Ben Leyland and Robert Lancastle “typically take a more cautious stance compared with most in the sector, emphasising capital preservation, as well as prioritising durable businesses with strong balance sheets and consistent cash generation”.
Morgan said this approach allows the fund to blend well with a growth‑oriented active fund or a tracker as part of a global allocation.
“A distinct approach and a concentrated portfolio can mean performance is very different to market returns for year-to-year, and it would tend to lag in a market rally driven by more expensive stocks that would benefit a tracker fund,” he added.
Indeed, JOHCM Global Opportunities has been in the fourth quartile of the IA Global sector for returns in six of the past 10 years.
Yet the managers’ focus on good quality global companies could also provide attractive long-term returns and weather downturns better than the index, Morgan noted.
Performance of the fund vs sector over 5yrs
Source: FE Analytics
At the other end of the style spectrum to a global tracker laden with the mega-cap tech and AI giants, Morgan suggested the £1bn AVI Global Trust. It takes a valuation-focused approach, with a targeted portfolio global companies identified and held through engagement and active ownership.
“The portfolio currently combines family-controlled holding companies, selected closed-ended vehicles and Japanese special situations but the focus can evolve over time,” he said.
The trust has generated “solid” long-term returns, gaining 38.2% over the five years to the end of March 2026, “despite the handicap of limited US equity exposure”.
AVI Global Trust is currently trading at a discount to net asset value (NAV) of almost 10%.
“Given the differentiation, there can be times when the catalysts of return don’t work and it sits in hibernation mode for an extended period – even during broader market rallies,” Morgan added.
“It is therefore necessary to buy into the manager’s philosophy and to take a patient, long-term approach.”
Performance of the trust vs sector over 5yrs
Source: FE Analytics
Meanwhile, Jemma Slingo, pensions and investment specialist at Fidelity International, suggested Pyrford Global Total Return, noting that it offers “significant downside protection”.
The £608.9m fund has been managed by Tony Cousins since inception in 2009 and relies heavily on bonds to achieve this, although it also holds unloved stocks and cash, she said.
“You are making a trade-off though, as the gentle ride and absence of severe falls come at the expense of the bigger gains tracker funds are likely to make when markets are benign,” Slingo noted.
She also suggested her firm’s own Fidelity Global Dividend, which fund selectors have previously highlighted as a strong defensive anchor in portfolios.
“Over the past decade, Fidelity Global Dividend has turned an initial investment of £1,000 into almost £2,700,” she said, noting that a global tracker fund could have generated stronger growth than this “but with more bumps along the way”.
Slingo’s suggestions were echoed by others, with selectors also pointing to more concentrated global strategies.
Charlie McCann, investment research analyst at Titan Square Mile, highlighted Havelock Global Select, which is ‘A’-rated by the research house and managed by Matthew Beddall.
The £249.1m fund has the flexibility to invest across a range of sectors, markets and companies, with the portfolio typically limited to between 25-50 stocks.
“It has a bias towards value stocks, which has often led it to have an overweight to stocks listed in the UK relative to global markets,” McCann said.
Performance of the fund vs sector over 5yrs
Source: FE Analytics
McCann also suggested another ‘A’-rated fund: Janus Henderson Global Smaller Companies. It draws on a proprietary quantitative screen to provide a robust foundation for stock selection, which leans on regional fund manager expertise.
“This local knowledge is invaluable in the small-caps space, given that management and regional nuance can significantly impact outcomes,” McCann said.
The fund’s performance overall has been strong but McCann warned it will face headwinds when markets are led by lower quality stocks or when larger companies are in vogue.
“Although it is worth noting that the fund has outperformed the MSCI World significantly since its launch in February 2025 – returning 18.9% versus 8.9% for the index to the end of March,” he added.
Looking beyond global equities to income-focused and alternative assets, Sheridan Admans, founder of Infundly, suggested PIMCO GIS Income and The Royal Mint Responsibly Sourced Physical Gold ETC.
“PIMCO GIS Income would play the role of an actively managed income and stabilisation sleeve,” Admans said.
The fund’s objective is to seek high current income, supported by long-term capital appreciation, by utilising a flexible global multi-sector fixed income approach “rather than a plain vanilla bond portfolio”.
“That makes it useful beside a global tracker because it should be less dependent on equity market leadership and may hold up better when shares struggle because growth is slowing or investors become more risk averse,” he said.
Performance of the fund vs sector over 5yrs
Source: FE Analytics
Meanwhile, The Royal Mint Responsibly Sourced Physical Gold ETC offers further diversification as it is linked to the spot gold price, providing exposure to an asset that often responds well during episodes of market stress, geopolitical uncertainty or falling confidence in financial assets.
“Gold can serve as a useful diversifying allocation when broader portfolios come under pressure, giving some reassurance around the overall strategy and helping reduce the temptation to make reactive decisions elsewhere,” Admans said.
Finally, Dzmitry Lipski, head of funds research at interactive investor, remained focused on the passive space when suggesting funds that would complement a global tracker like UBS Core MSCI World ETF.
He first highlighted Vanguard Global Small-Cap Index, which tracks the MSCI World Small Cap index of small-sized company stocks in developed markets.
Lipski said these “often more domestically driven companies have historically higher long-term return potential but with higher volatility”, adding that the fund ultimately adds growth and diversification away from mega-caps.
He also suggested adding bonds to smooth returns by adding stability, income and downside protection during equity sell-off.
SPDR Bloomberg Global Aggregate Bond ETF tracks the Bloomberg Global Aggregate Bond index (GBP hedged), which comprises over 31,000 issues.
He then suggested adding exposure to UK equities, noting that they offer an attractive dividend income – with the current yield of the FTSE 100 at over 3%.
Lipski highlighted Vanguard FTSE UK Equity Income Index, noting that it would help to “enhance portfolio income, strengthen diversification and reduce reliance on the dominance of US technology stocks”.