Sales surge 43% as equity funds hit highest inflows in 13 years

Retail fund sales surged by 43 per cent last year, according to Investment Management Assocation figures.

Net retail fund inflows stood at £20.4bn for 2013, an increase from the £14.3bn in 2012.

Within this, equity funds saw the highest net retail sales in 13 years as they attracted £11.4bn.

Total funds under management swelled to a record £770bn in 2013, up 16 per cent from 2012 when this was £662bn.

IMA Mixed Investment 20-60% Shares was the most popular sector of year with £3.1bn in net retail sales.

The second most popular was the Targeted Absolute Return sector, which enjoyed £2.2bn in net retail sales.

The UK Equity Income and Global Equity Income sectors both received net retail sales of £1.8bn in 2013, while the Property sector saw £1.5bn in net retail inflows.

In contrast, the worst selling IMA sector for the year was the £ Corporate Bond sector with an outflow of £1.7bn – the lowest net retail sales for the sector since its launch in 2008.

This sector saw consistent outflows in every month of the year and was the worst selling sector for seven months.

In terms of distribution channels, gross retail sales through UK platforms accounted for 49 per cent of the total market with £66.2bn in 2013. 

This was an increase since 2012 when platforms accounted for 45 per cent of market flows.

Gross retail sales through ‘other intermediaries’, such as wealth managers, stockbrokers and Ifas, total £56.7bn in 2013 and accounted for 42 per cent of the market – down from 48 per cent of the market in 2010. 

IMA chief executive Daniel Godfrey says: “Retail investors were highly active in 2013, committing an average of over £1.6bn of new money to funds every month. 

“Equity funds took by far the largest share of the net inflows from investors. After a number of years with the strongest net sales, fixed income took no new money in 2013. Both mixed asset and property funds saw stronger inflows than in 2012.”