UK equity funds sidelined in ‘record breaking’ H1 inflows

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UK equity funds have been sidelined in the industry’s largest H1 net sales on record, Investment Association figures show.

Retail investors placed £18.4bn in UK-authorised funds taking total funds under management to £1.1trn.

“This is the highest level of net sales in the first half of any year on record,” says Investment Association chief executive Chris Cummings.

The “extraordinary” first six months saw net inflows across IA sectors, but UK equities were the least popular – a trend that continued in June with net outflows totalling £1.1bn.

Targeted Absolute return continued its reign as the most popular individual sector for retail investors with net inflows of £2.2bn over H1, followed by the £ Strategic Bond sector, which attracted £1.8bn and Global equity sales were £1.6bn.

Fund market specialist Alastair Wainwright says: “So far, 2017 has been an extraordinary year for the UK funds industry as investors seem to have returned from their 2016 hiatus. Net retail sales were once again strong in June, reaching £2.9bn.”

The worst-selling IA sector for the month was the UK All Companies sector with outflows of £486m.

Fixed Income was the best-selling asset class in June 2017, with net retail sales of £1bn, followed by Mixed Asset funds with net retail sales of £905m.

In terms of net retail sales by region, global equities were the best selling in June with £707m followed by Europe (£209m) and Japanese equity funds (£168m).