Gold rallied throughout August after investors worried about a wide range of geopolitical risks, leaving the top of the month's performance rankings dominated by precious metals strategies.
The MSCI AC World gained 1.9% last month (in sterling), while the Nasdaq 100 was up 3.5%, Japan's Topix rose 2.8% and the MSCI Emerging Markets index lifted 2.6%.
Ben Yearsley, director at Fairview Investing, said: "August is supposed to be the quiet month, but markets clearly didn't get the memo. War, $90 oil, sticky inflation and rising bond yields should be a fairly toxic cocktail, yet equity markets remain remarkably resilient. Investors seem determined to keep climbing the wall of worry – although with rate cuts disappearing into the distance, September could provide a few loose bricks."
One place where these risks did show up was gold, which gained more than 9% in August. The yellow metal ended the month at $4,481 an ounce, having started at $4,107.
Yearsley said that "gold bugs have rarely had so much material to work with", given August's news flow included rising tensions in the Iran war, worries over ballooning government debt, a bond market sell-off and questions over the dominance of the US dollar.
Source: Finxl. Total return in sterling between 1 and 31 Aug 2026. Excludes AIC's unclassified and VCT sectors.
As the table above shows, the 10 best-performing funds in the Investment Association universe last month invest in precious metals miners. Silver was up around 15%, in sterling terms.
UBS Solactive US Listed Gold & Silver Miners UCITS ETF made the highest return, up 34.8%, followed by iShares Gold Producers UCITS ETF's 34.1% gain.
Gold funds accounted for the 13 best open-ended funds in August. WisdomTree Cloud Computing UCITS ETF came in 14th place, with a 20.8% return.
Four of the 10 best-performing investment trusts in August were commodities strategies: Golden Prospect Precious Metals, CQS Natural Resources Growth and Income, Geiger Counter and BlackRock World Mining.
Overall, commodities surged in August, with the broad S&P GSCI index gaining 5.3% in sterling terms. In addition to the rising gold price, oil was up as Iran continues to restrict transit through the Strait of Hormuz, while agricultural commodities such as cocoa, sugar, wheat and corn rose more than 15%.
This meant that the IA Technology and Technology Innovation sector was the highest-returning peer group in the Investment Association universe with an average return of 8.6%. IT Commodities & Natural Resources topped the Association of Investment Companies leader board with a 16.3% average return.
Source: Finxl. Average return in sterling between 1 and 31 Aug 2026
Tech funds also benefited from buoyant equity markets, as investors continued to back companies linked to the AI revolution and those supplying its buildout, such as semiconductor stocks and energy businesses. IA Technology & Technology Innovation was the second-best sector with a 5.5% average return.
Outside of the top 10 funds, but boasting double-digit returns for August, are the likes of WisdomTree Cloud Computing UCITS ETF, abrdn Future Raw Materials UCITS ETF, WisdomTree Uranium And Nuclear Energy UCITS ETF and WisdomTree Cybersecurity UCITS ETF. Geiger Counter, a uranium-focused investment trust, made 22.4%.
JPM Taiwan, JPM Korea Equity and Barings Korea Trust made high returns last month, reflecting the countries' dominance in semiconductor and memory chip industries.
Funds and trusts with a preference for stocks at the cutting-edge of technology, such as ARK Disruptive Innovation, Baillie Gifford Global Discovery and Scottish Mortgage Investment Trust also had a strong month.
Source: Finxl. Total return in sterling between 1 and 31 Aug 2026. Excludes AIC's unclassified and VCT sectors.
When it comes to the worst funds of August, Fairview's Yearsley said the overriding theme was property, which suffered as investors priced in the growing risk that the US will increase interest rates.
"Despite little speculative building in the past decade, property can't seem to break the shackles – is it a rental growth story or simply an income one?" he asked. "If the malaise continues, property will be an irrelevant asset class before long."