The first half of 2021 has seen total net retail sales of £24bn, the highest level of half-year sales since 2017, according to the Investment Association’s (IA) latest data.
In June alone, net retail sales reached £4.2bn, double the amount seen in June 2020.
Investment Association chief executive Chris Cummings (pictured) said: “The positive inflows for the first half of the year are a clear sign of the strong economic recovery and growing investor confidence as we emerge from the pandemic.
“If the pace of net sales continues at the same rate, we could be on track to match the record-breaking inflows of 2017. However, investors also have one eye on inflation, which may have a greater impact in the second half of the year.”
Global inflation-linked bonds, trackers and responsible funds see healthy inflows
Despite inflation rising, the newly-launched Global Inflation Linked Bonds was the highest selling fixed income sector attracting £214m during the month, representing 4% of the sector’s total FUM of £5.6bn.
Tracker funds also continued to see strong inflows in June, with net retail sales reaching £2.2bn. Earlier this month, the London Stock Exchange announced it would fast-track new rules to lure in start-ups and dual class share structures such as Deliveroo to ultimately draw on investors including tracker funds.
Cummings added: “Investors looking for lower cost ways to save have continued to put their money into tracker funds. The difference in the data has been steady sales to active funds following March 2020’s outflow, helping flows to reach a record H1 total.”
Meanwhile, responsible investment funds saw record inflows, with over £1bn of inflows in June, and a total of £4bn for Q2 – the highest quarterly inflows since IA data was first collected. Responsible investment funds under management stood at £78bn at the end of June.
Top and worst-selling sectors
In June, Global was the top-selling sector, with net retail sales reaching £1.1bn. Mixed investment 40-85% shares was second with net retail sales of £910m. The Volatility Managed sector followed with net retail sales of £363m. The Global Inflation Linked Bond sector was fourth with net retail sales of £214m, and Europe excluding UK came in fifth with net retail sales of £312m.
The Short Term Money Market sector was the worst-selling sector, recording outflows of £389m, according to the IA data.
On a regional basis, European funds saw retail inflows of £247m, while North America, Japan and Asia funds saw net inflows of £184m, £107m and £72m, respectively.
The UK was the only equity fund region that experienced outflows at £77m.
