The group remarked: “While there have been outflows for some time in the non-UK denominated funds, it is notable that the large UK OEIC has seen its first ever large outflows. We expect consultants, who are the gatekeepers of UK defined benefit pension money, are now advising clients to switch out of GARS and into an alternative. Given the length of time it takes to move on to (or off) consultants’ buy lists, we expect the net outflows will continue throughout 2017 irrespective of the performance of GARS this year.”
By contrast, RBC CM thinks relative newcomer AIMS will see earnings growth and has accordingly upgraded the fund to an outperform ranking.
“Strong net inflows are driving assets upwards and we estimate that AIMS assets are currently £8.8bn, almost 3 times the level at the start of the year (£3.0bn). Higher assets should drive earnings and we set out our view that AIMS is a key component of a re-emergence of growth at Aviva, which we expect will drive multiple expansion.”
