Fixed income fund sales bounced back by £624m in October, increasing for the first time since April 2015, according to the monthly figures from the Investment Association.
Fixed Income funds saw a net retail inflow of £109m for the first time in six months compared to an outflow of £515m in September.
However, equity continues to be the best-selling asset class for the sixth consecutive month with net retail sales of £710m, the IA says, although the number was down from the £1bn reached in September.
Looking at sectors, Targeted Absolute Return was the best-selling sector with net retail sales of £424m, followed by Europe Excluding UK with net retail sales of £379m and UK Equity Income with net retail sales of £324m.
Net retail sales of tracker funds more than halved in October at £204m compared to £539m in September, and were at their lowest since December 2013.
Total net retail sales increased to £1.2bn in October from £1.1bn in September.
Investment Association interim chief executive Guy Sears says: “Net retail fund sales stood at £1.2bn in October, mainly driven by continued investor appetite for equity funds but we also saw fixed income products recover and hit a six-month high.
“Targeted Absolute Return was the best-selling sector for the third time this year, and mixed asset funds were the second best-selling asset class suggesting many investors looked to fund manager wisdom for asset allocation.”