At the close of business on 28 June, private investors owned £207.7bn of UK equities with their share of the FTSE All Share dipping to 11.2% – the lowest level since August 2010.
Charles Cryer, chief executive of Capita Registrars, said private investors had sold off more shares in recent months even than in the summer of 2008.
“The tone has certainly changed in recent months – at the beginning of 2012 there was optimism the economy had turned a corner and the eurozone crisis had quietened down,” he said.
“This encouraged private shareholders very cautiously to add to their holdings. It seems their caution was justified as the market rally faded, and the economy sank back into recession. The eurozone crisis has now reached another critical phase and hopes for the global economy have been dampened. Private investors have reacted by selling shares in large volumes.”
While investors understandably remain nervous about the capital value of their holdings, more encouraging news comes from dividend payments. In the first quarter, total dividends paid to retail shareholders reached £2.14bn, which was 22% higher than the previous year. This was in part due to generous payments from mega caps, most notably Vodafone.
For its full year forecasts, Capita Registrars now expects private investors to see £8.7bn in income from UK equities, an increase of £658m compared to 2011.
