Having accumulated net inflows totalling £985m, the Sterling Strategic Bond sector was the top selling sector in September, which according to updated statistics is the third month in a row the sector has topped the rankings.
September was also a strong month for Global and Europe ex UK funds, which took in net sales of £533m and £489m respectively, while UK All Companies replaced Property as least popular sector, after net outflows hit £111m.
Overall however it was a strong month for fund flows, with total net retail sales hitting £5.6bn, which easily surpasses the previous £4.9bn record for sales hit in April this year.
“With three months of the year to go, 2017 is already the best-selling year since IA record began,” said Chris Cummings, chief executive of the IA.
Alastair Wainwright, a fund market specialist, added: “In the year to end of September 2017, net retail sales totalled £33.7bn. Q3 2017 was the highest selling quarter on record with net retail sales of £14bn, closely followed by Q2 2017 at £12.1bn. The six highest selling months have all occurred in 2017.”
Commenting on the figures, Laith Khalaf, a senior analyst at Hargreaves Lansdown, said: “ Sales of bond funds have picked up significantly over the summer months, which is bizarre given the heightened expectations of rising interest rates over this period. Much of this money has flowed into strategic bond funds, which in theory have the flexibility to shelter investors from the worst ravages of rising rates on fixed income prices, if the manager makes the right calls.
“Sales of UK equity funds have been abysmal in 2017, continuing last year’s trend, which suggests a high level of pessimism towards the domestic stock market. Global and European equity funds have really taken up the slack though, as we have seen a resurgent global economy and Europe picking itself up by its bootstraps.
“Sales of Japanese and North American equity funds have also made positive contributions to the total so far this year, though Asian fund sales are still going backwards.”
