Equity fund sales overtake bonds for first time in 12 months, IMA stats

Equities have replaced bonds as the best-selling asset class for the first time in 12 months, according to the Investment Management Association.

Equities was the leading class in September 2012 with net retail sales of £541 million – well above its average over the last 12 months, which is an outflow of £65 million. By contrast, fixed income was the second best-selling asset class with net retail sales of £320 million, the lowest since the asset class recorded £317m of sales in September 2011.

The news comes as the IMA reported net retail fund sales of £1.1bn during September, after outflows hit sales in August, after just £34.8m in sales was generated during the previous month.

The Absolute Return sector was the best-selling sector in September 2012 with net retail sales of £193 million, well above its monthly average of £58 million over the previous 12 months. Strategic Bonds and Global Emerging Markets were the second and third bestsellers with sales of £144m and £139m respectively. Global Equity Income was fourth with sales of £137m, while UK Equity Income was the fifth best-selling sector with sales of £134m.

UK All Companies was the worst-selling sector with a net outflow of £206 million in September 2012. It has been the worst-selling sector for eight out of the last twelve months.

IMA director of markets Jane Lowe says: “Net retail sales were again above £1bn in September, reversing the unexpected outflows seen in August.

“Overall net retail sales of equity funds outstripped fixed income for the first time in a year. Global funds took the lion’s share of these net sales, against a notable outflow from UK equity growth funds.

“However substantial inflows were seen in both UK and Global equity income funds, and a focus on income was apparent in three out of the top five selling sectors.”