The Investment Association’s statistics of UK investor behaviour in January 2017 show:
Chris Cummings, Chief Executive of the Investment Association, said:
“2016 finished with a flourish as December recorded the highest net retail sales for the year, so it is not surprising to see sales were somewhat subdued in January. UK investors particularly looked to the industry to provide them with targeted risk managed solutions and asset allocation.”
Alastair Wainwright, Fund Market Specialist, said:
“In what was a quiet month for fund flows, Mixed Asset was the best-selling asset class in January with £428 million in net retail flows. The Mixed Investment 40-85% Shares sector was the best-selling mixed-asset sector attracting £175 million of retail investor money.
“For the fourth month in a row Targeted Absolute Return was the best-selling sector, largely due to discretionary fund managers allocating to the sector. Sterling Strategic Bond was the second best-selling sector as, with the exception of a small outflow through the Direct sales channel, it received positive net sales through all retail distribution channels.
“The momentum of inflows into equity funds toward the end of 2016 did not carry through to the New Year. UK and European equity funds were once again worst hit with net retail outflows of £505 million and £399 million respectively. Global and North American focused funds were the only positive equity regions in January as investors sought to take advantage of the “Trump Trade” and the new administration’s expected relaxation of regulation in the US.”
FUNDS UNDER MANAGEMENT AND NET SALES
|Funds Under Management||Net Retail Sales||Net Institutional Sales|
|January 2017||£1.0 trillion||£366 million||£994 million|
|January 2016||£900 billion||-£1.3 billion||£32 million|
Mixed asset was the best-selling asset class in January 2017, with net retail sales of £428 million.
Fixed income funds were the second best-selling with net retail sales of £231 million.
Property and money market funds both experienced small net retail outflows of £58 million and £70 million respectively.
Equity funds saw a larger outflow of £697 million, representing the first outflow since October last year.
NET RETAIL SALES OF EQUITY FUNDS BY REGION*
Global equity funds were the best-selling in January with net retail sales of £225 million.
North American equity funds were the next best-selling with net retail sales of £98 million.
Japanese equity funds saw a net retail outflow of £20 million, while Asian equity funds had an outflow of £121 million.
European and UK equity funds saw larger outflows of £399 million and £505 million respectively.
Net retail sales
in January 2017
|Average net retail sales
for previous 12 months
|Global||£225 million||£233 million|
||£98 million||-£33 million|
|Japan||-£20 million||-£76 million|
||-£121 million||-£79 million|
||-£399 million||-£297 million|
||-£505 million||-£408 million|
THE INVESTMENT ASSOCIATION SECTOR RANKINGS
The top five best-selling Investment Association sectors for January 2017 were:
The worst-selling Investment Association sector in January 2017 was the UK All Companies sector with an outflow of £408 million.
|Investment Association Sector||
Ranking in Jan
Net Retail Sales
in Jan 2017
|Net Retail Sales
in Dec 2017
|Targeted Absolute Return||1||£297 million||1||£422 million||Other|
|£ Strategic Bond||2||£229 million||3
||£264 million||Fixed Income|
|Mixed Investment 40-85% Shares
||£217 million||Mixed Asset|
|Flexible Investment||5||£81 million||12
||£68 million||Mixed Asset
In January, gross retail sales for UK fund platforms totalled £7.3 billion, representing a market share of 48.2% (45.7% in January 2016).
Other Intermediaries including UK IFAs and Wealth Managers attracted gross retail sales of £4.0 billion, representing a market share of 26.0% (21.8% in January 2016).
Direct gross retail sales in January were £829 million, representing a market share of 5.4% (12.1% in January 2016).
FUND PLATFORM PRODUCT SALES
For the five fund platforms that provide data to The Investment Association (Cofunds, Fidelity, Hargreaves Lansdown, Old Mutual Wealth and Transact) we saw net retail sales of £661 million in January.
Personal Pensions had net sales of £600 million, Unwrapped £127 million, and Insurance Bonds and ISAs saw outflows of £17 million and £49 million respectively.
For the same five fund platforms, funds under management as at the end of January 2017 were £231 billion, compared with £193 billion a year earlier.
In January 2017, funds in ISAs provided by fund companies and the five fund platforms that feed data to The Investment Association (Cofunds, Fidelity, Hargreaves Lansdown, Old Mutual Wealth and Transact) saw a net outflow of £339 million.
The top three best-selling sectors for ISAs based on the five fund platforms were:
FUND OF FUNDS
Funds of funds had a net retail inflow of £370 million in January 2017.
Funds of funds that invested externally saw net retail sales of £243 million, while funds that invested internally saw net retail sales of £127 million.
Funds under management for funds of funds were £124 billion at the end of January 2017, accounting for 11.9% of industry funds under management, compared with 11.4 % in January 2016.
Tracker funds saw a net retail inflow of £320 million. Tracker funds under management stood at £143 billion as at the end of January 2017. Their overall share of industry funds under management was 13.6%, compared with 11.4% in January 2016.
Net retail sales of ethical funds were £70 million in January 2017. Funds under management were £12.4 billion at the end of January, representing a 1.2% share of industry funds under management.-ENDS-
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To see a breakdown of the data referenced in this press release, please see all of the tables here.
The Investment Association's figures for fund sales cover retail and institutional sales in authorised unit trusts and open ended investment companies (OEICs) provided by our membership to UK investors. The figures do not include investment trusts and ETFs.
Each month small revisions to figures may have been made since the previous press release. This reflects additional information received by The Investment Association.
Net retail sales comprise total retail sales minus repurchases (including switches between funds), thus the figures can result in a negative figure or outflow.* Regional breakdown for equity funds
The following Investment Association sectors have been grouped together to compile the figures for regional equity sales:
|Asia Pacific excl. Japan||Europe Excl. UK||Global||Japan||North America||UK All Companies|
|Asia Pacific incl. Japan||Europe Incl. UK||Global Emerging Markets||Japanese Smaller Companies||North America Smaller Companies||UK Equity Income|
|China/Greater China||Europe Smaller Companies||Global Equity Income||UK Smaller Companies|
|Technology and Telecommunications|
Direct includes sales forces and tied agents, private clients and other direct to investor sales without intermediation.
** The Investment Association’s ISA figures are based on information collected from fund companies and five fund platforms (Cofunds, Fidelity, Hargreaves Lansdown, Old Mutual Wealth and Transact) where they are the ISA provider. Fund business through other ISA providers such as wealth managers is not included. The Investment Association’s figures cover about three-quarters of the whole of the market for funds held in ISAs.
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