Morningstar

The UK Funds That Lost Investors the Most Money in 2025

Most fund investors made money in 2025. These funds did the opposite.

Emerging markets artwork

Key Takeaways

  • India equity funds dominated the list of the worst-performing UK funds in 2025.
  • Fewer than 10% of Morningstar-rated funds available to UK investors lost money last year.
  • High valuations left Indian markets vulnerable after years of strong returns.

2025 was a strong year for most UK fund investors but not everyone shared in the gains. While global markets rallied and emerging markets outperformed, a small group of funds delivered losses, with India equity strategies dominating the list of worst performers.

Of over 3,100 funds available for sale to UK investors and with a Morningstar Medalist Rating, 234 funds had a negative 2025 and 17 fell by double digits. India equity funds dominate at the bottom of the list—of the 50 worst performers, 30 funds focus on Indian equities.

The underperformance follows years of strong growth for the Indian equity market. Over the past 10 years, the Morningstar India Index has increased 211% in GBP terms, while the India equity fund category has a 10-year annualized return of 8.46%. India is 15.3% of the MSCI Emerging Market index, which gained 33% in dollar terms in 2025, beating developed market returns for the first time since 2020.

India’s strong historic performance has elevated expectations and stretched valuations, leaving the market vulnerable to any changes in sentiment, according to Kate Marshall, lead investment analyst at Hargreaves Lansdown.

“While uncomfortable, this kind of reset is not unusual after a strong run and does not undermine India’s longer-term potential. The potential for further dollar weakness can also create investment opportunities for firms with global revenue, and for emerging markets where debts are often denominated in dollars,” she says.

Meanwhile, other emerging markets outperformed in 2025, including Korea, Latin America and China.

Many natural resource equity funds also had a strong year due to the precious metals rally, but this didn’t apply to the entire fund category. Pictet Timber fell 13% in 2025, hit by tariffs and slow construction demand, according to Ben Yearsley, director at Fairview Investing. The fund became the sixth worst performer over the year.

The Worst-Performing Funds for UK Investors in 2025

Invesco India Equity Fund

Invesco India Equity lost 17.57% in 2025, making it the worst performer. The fund fell further than the average fund in the India equity category, which declined 8.81%. The Invesco fund placed in the 97th percentile for performance. Over the past three years annualized, the fund has still managed to outperform the category, gaining 7.95% compared with the fund average of 6.64%. Over the past five years, the £835.5 million fund’s performance is even stronger, climbing 9.83% on average per year, compared with the 9.08% gain for the category.

The actively managed fund lost 3.13% in December, falling further than the India equity category, which fell 2.59%.

Stewart Investors Indian Subcontinent All Cap Fund

The actively managed Stewart Investors Indian Subcontinent All Cap lost 16.0% in 2025, falling further than the average fund in the India equity category, which fell 8.81%. The fund placed in the 94th percentile for performance. The £363.8 million fund has gained 2.39% over the past three years annualized, while the average fund in its category saw stronger returns of 6.64%. Over the past five years on average, the fund has climbed 7.83%, compared with the 9.08% gain for the category.

The Neutral-rated fund lost 2.95% in December, falling slightly further than the average category fund, which fell 2.59%.

Liontrust India Fund

The £85.7 million Liontrust India fund lost 15.75% in 2025, falling further than the average 8.81% return for the India equity category. It placed in the 94th percentile for performance. On a three-year annualized basis, the fund has gained 5.39% while the category was up 6.64%. Over the past five years annualized, the Liontrust fund has climbed 10.19%, compared with the 9.08% gain for the average fund in the category.

In December, Liontrust India fell 2.33% while the average category fund fell further, by 2.59%.

MI Polen Capital Emerging Markets Discovery Fund

The actively managed MI Polen Capital Emerging Markets Discovery Fund lost 14.27% in 2025, underperforming the average fund in the global emerging markets small/mid-cap equity category, which rose 13.24%. The fund placed in the 98th percentile for performance. The fund has lost 0.6% over the past three years on an annualized basis, while the average fund in its category has achieved 10.06% growth. Over the past five years, the Polen Capital fund has dropped 1.95%, compared with the 6.87% gain for the category.

The emerging-markets fund fell 5.96% in December while the category lost 0.48%.

GQG Partners US Equity Fund

The Gold-rated GQG Partners US Equity lost 13.98% in 2025, underperforming the average fund in the US large-cap blend equity category, which rose 7.9%. The fund placed in the 100th percentile for performance. The fund underperformed over three years too, gaining 7.64% on an annualized basis compared with the category average of 16.05%.

The £1.2 billion actively managed fund lost 2.92% in December, falling further than the US large-cap blend equity category, which fell 1.07%.

Pictet Timber

The actively managed Pictet Timber fund lost 13.19% in 2025, underperforming the average fund in the equity natural resources category, which rose 51.79%. The fund placed in the 100th percentile for performance in a varied category where some funds were among the best performers in 2025. The active fund has lost 2.34% over the past three years annualized, while the average fund in its category has grown 9.66%. Over the past five years, the Pictet fund has climbed 1.17% on average per year, compared with the 11.24% gain for the category.

The £429.6 million timber fund gained 0.4% in December but still underperformed the category average of 4.75%.

Comgest Growth India

The actively managed Comgest Growth India lost 12.42% in 2025, falling further than the average fund in the India equity category, which fell 8.81%. The fund placed in the 82nd percentile for performance. The £48.6 million fund has gained 7.68% over the past three years, outperforming the annualized category average of 6.64%. Over the past five years annualized, the Comgest fund has climbed 8.38%, compared with the 9.08% gain for the category.

Comgest Growth India lost 2.32% in December.

Aberdeen Indian Equity Fund

The £509.8 million Aberdeen Indian Equity lost 12.19% in 2025, falling further than the average fund in the India equity category, which fell 8.81%. The fund placed in the 79th percentile for performance. Over a three-year annualized period, it gained 5.22%, lower than the average fund in its category, up 6.64%. Over the past five years, the Aberdeen fund has climbed an average of 4.92% per year, compared with the 9.08% gain for the category.

Aberdeen Indian Equity dropped 2.43% in December, less than the average India equity fund, which fell 2.59%.

FSSA Indian Subcontinent All-Cap Fund

FSSA Indian Subcontinent All-Cap lost 12.14% in 2025 while the average fund in the India equity category fell 8.81%. The fund placed in the 79th percentile for performance. The fund outperformed over the longer term; on a three-year annualized period, it has gained 8.02% compared with the category’s 6.64% return, while over five years, the First Sentier Investors fund has climbed 10.22%, compared with the 9.08% gain for the category.

The £36.9 million fund lost 1.95% in December, less than the average fund in the India equity category, down 2.59%.

Wellington Management Funds FinTech Fund

Wellington FinTech lost 11.92% in 2025, making it one of only two Morningstar-rated technology funds with a negative return over the year. It underperformed the category average of 17.21%, placing the fund in the 98th percentile for performance. The £50 million fund has gained 5.8% over the past three years on an annualized basis, while the average fund in its category is up 23.48%. Over the past five years, the Wellington Management fund has dropped 4.27%, compared with the 9.09% gain for the category.

The actively managed fund lost 0.62% in December, falling less than the average fund in the equity technology category, which fell 0.91%.

The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar's editorial policies.

© Copyright 2026 Morningstar, Inc. All rights reserved.