The most successful managers are not always the most prominent ones, as is clear from the Mixed Assets – Flexible Portfolio sector.

Few eschew attention like the Bruce fund, though, despite its remarkable longevity since its launch in 1968. Father and son managers Robert and Jeffrey Bruce, both Citywire AAA-rated, have maintained an extremely low profile and their fund can only be bought directly rather than via brokers.

Yet that minimalist take on marketing has not stopped their fund from attracting almost $600 million of assets, thanks to its strong track record. The eclectic portfolio holds both stocks and bonds, with major positions including U-Haul’s parent Amerco and zero-coupon treasuries.

Equally unheralded, but in a different way, is AAA-rated Ralph Doudera. He provides significantly more information about his approach, but his Spectrum Low Volatility fund – essentially a diversified fund of other bond funds – has just $50 million of assets even though it can boast the best risk-adjusted returns in this category over the past three years and a commendable performance over the past 12 months too.

One factor identified by Doudera explaining his fund's small size is his use of leverage. ‘Many investors don’t understand our use of leverage and see it as a red flag,’ he said. ‘We can get out of everything we are in today if we need to. If we see an opportunity to put some leverage on to enhance return, we do – and we use leverage across our funds.’

Another consideration is likely to be Spectrum Low Volatility’s fees, with an expense ratio of 3.1% at the end of 2016. The fund’s risk-adjusted returns quoted in the table are net of fees, however, making its performance all the more impressive.

Discount hunters

The managers with the second-highest risk-adjusted returns in this sector over the past three years also operate a fund of funds, although they focus on closed-end vehicles. Virtus Herzfeld, run by the AAA-rated father and son team Thomas and Erik Herzfeld, targets closed-end funds on ‘excessive or unusual’ discounts with a path to narrowing.

The Herzfelds have observed that the closed-end market remains inefficient, with nearly 75% of investors in this space not professional managers, so expect ‘behavioral investing miscues’ to continue to allow them to generate alpha.

Two more conventional funds complete the top five over the past three years. By far the larger, at almost $500 million, is Columbia Flexible Capital Income, managed by the AA-rated pair David King and Yan Jin. They have a traditional blend of equities and bonds in their portfolio, with the titular income bias.

Much smaller at only $10 million is Carl Marker’s IMS Dividend Growth fund, although its three-year risk-adjusted performance is identical to that of the Columbia product. A proprietary strategy out of Pacific Northwest-based wealth manager IMS Capital Management, it has an all-cap mandate for dividend investing, with holdings ranging from titans such as Microsoft to more niche companies such as CDK Global, which sells technology and marketing services to automotive retailers.

Top five Mixed-Asset managers by three-year risk-adjusted returns

Performance as at February 28 2017.