Record Asian equity outflows as UK equity income stays strong – IA

Published 30 September, the report revealed that Asian equity vehicles saw the largest volume of fund outflows on record at £314m net, while the £125m net outflows from Global mandates represented the highest figure since November 2011.

Furthermore, net retail sales across the board stuttered, dropping to £690m for the month – a 77% decrease on the £3bn recorded in July.

However, equity funds remained popular with investors for the fourth consecutive month, with net retail sales totalling £503m.

Property took second place with £184m net; however, this represented a 37% slide on the £294m net sales the previous month, and the lowest monthly total for two years.

At £55m net, mixed asset mandates registered their lowest monthly figure since January 2009, down 87% month-on-month, while fixed income saw its biggest net outflow since June 2013 with £333m-worth of redemptions.  

UK equity was by far the most-bought sector in regional terms, hitting £719m net in August having averaged net outflows of £13m during the past 12 months. Europe and Japan were the next best-selling regional equity markets, registering net figures of £146m and £102m respectively.

On the IA sector side, UK Equity Income ranked top for the eighth time in 12 months with net retail sales hitting £520m, followed by Targeted Absolute Return’s £243m and Europe Excluding UK’s £220m.

Property and UK All Companies completed the top five, on net sales of £184m and £173m respectively, while at the other end of the spectrum, Asia Pacific Excluding Japan suffered the biggest retail outflows at £218m net.

“Market volatility may have made investors more cautious in August, reinforcing a tendency for sales to dip over the summer period,” said Daniel Godrey, IA CEO.

“In terms of asset allocation, investors appear to be sticking with equities – particularly equity income funds – whilst withdrawing money from bonds, perhaps in expectation of an interest rate rise.”