Equity funds roar back in favour

Sales of equity funds have overtaken fixed income vehicles for the first time in a year, according to latest stats from the IMA.

Equity funds roar back in favour


Data for September shows equity as the leading asset class with net retail sales of £541m, well above its average over the last 12 months, which is a monthly outflow of £65m. The last time equity was the best-selling asset class was back in August 2011, when it achieved net retail sales of £552m.

Having led the way this year, particularly the £ Corporate Bond and Strategic Bond sectors, overall sales of fixed income funds fell to £320m, the lowest since September 2011.

In terms of individual sectors, Absolute Return was, perhaps surprisingly, the bestseller during the month with net sales of £193m, well above its monthly average of £58m over the previous 12 months. This is the first time it has topped the sales tables since September 2009.

Next in line was £ Strategic Bond (£144m), followed by equity sectors Global Emerging Markets (£139m), Global Equity Income (£137m) and UK Equity Income (£134m).

However, the bottom of the rankings has not changed with UK All Companies registering £206m outflows; it has been the worst-selling sector for eight out of the past 12 months.

Jane Lowe, IMA director of markets, said: “Net retail sales were again above £1bn in September, reversing the unexpected outflows seen in August.

“Overall net retail sales of equity funds outstripped fixed income for the first time in a year. Global funds took the lion’s share of these net sales, against a notable outflow from UK equity growth funds. However substantial inflows were seen in both UK and Global equity income funds, and a focus on income was apparent in three out of the top five selling sectors.”


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