Revealed: The fund groups topping the 'dog' list

Retail investors' money in underperforming funds has leapt by 74% to £23.16bn, an increase of over £10bn since November 2010, according to Bestinvest.

The investment manager's Spot the Dog report reveals Fidelity are top dogs with £3.4bn of poorly performing assets, the majority of which are held in Sam Morse's £3.1bn Fidelity European fund.

Newton sits in second place, with BlackRock, Schroders and Scottish Widows the other top offenders.

Funds in the IMA Global sector were the worst performers with 27 dog funds making the list, up from 11 in 2010.

BlackRock’s Mark Lyttleton has entered Bestinvest's infamous list of 'dog funds' after underperforming the benchmark consistently on both his £1.4bn UK Dynamic fund and £541m UK fund.

Bestinvest highlighted Lyttleton's performance as one of the worst in the UK All Companies sector, leaving BlackRock with the third highest level of assets in poorly performing funds.

Senior investment adviser at Bestinvest Adrian Lowcock said Lyttleton has consistently provided disappointing returns to investors over the periods analysed by the report.

"Although this is Lyttleton's first appearance in Spot the Dog, both his UK funds are perilously close to being the worst performing of all UK All Companies sector funds in the report (only three places behind Manek Growth which is run by a former Charing Cross shopkeeper who won a newspaper competition a couple of times and decided to launch his own equity fund)," he said in the report.

The independent investment manager's biannual Spot the Dog report assesses the 2,290 unit trusts and Oeics that make up the IMA sectors.

The worst performers - funds that not only underperform their benchmarks in each of the last three years but also underperform by a cumulative 10% over the same period - are featured in the list.

"UK investors are coughing up somewhere in the region of £348m a year for underperforming funds that we have identified here," said Lowcock.

"Over the three years to the end of June 2011 this equates to somewhere in the region of £1bn that private investors have forked-out for the underperforming managers."