UK retail investors placed a net £1.1 billion into funds in April, the strongest inflows of the year to date, according to data published by the Investment Association (IA) today.
April’s data marks a second consecutive month of fund inflows despite heightened geopolitical uncertainty, after Q1 2025 saw the worst quarter since 2023.
March and April net sales are traditionally boosted by ISA season as investors make the most of the changing tax year and new contribution allowances. Compared to inflows in April 2024 of £3.2 billion, this year’s sales lift is more modest, but still a positive sign amidst a tricky investing environment.
Despite uncertainty around tariffs and trade policy in the US, North American equity inflows remained strong at £948mn this month. Whilst this may be a result of more risk-on investors ‘buying the dip’, the high inflows to money market funds show prevailing caution as investors wait to see how markets will settle. In equities, we also see inflows to Europe continue as some investors look to increase diversification away from North America.
Key findings for April:
- Equity funds saw strong net retail sales of £962 million, led by North American equities (£948m).
- Globally diversified equity funds also saw inflows of £872 million, while European equities recorded £106m in inflows, a second month of inflows, but down on £245m in March.
- UK equity funds saw continued outflows of £817 million but easing slightly from £1.2 billion in March.
- Multi asset funds witnessed significant inflows of £728 million in April, up from just £149 million in March. This is the highest inflow since August 2021.
- Money market funds also saw a second month of strong inflows of £1.1 billion, following £1.3 billion in March.
- Bond funds continued to see heavy outflows in April of £1.8 billion. High Yield in particular saw record outflows of £177 million, as investors may be deterred by concerns that tariffs will have an inflationary effect, reducing the scope for future interest rate cuts by central banks. A more challenging economic environment could also drive higher defaults on high yield bonds, which have lower credit ratings.
- Index tracking funds took inflows of £969 million in April. Whilst still in positive territory, this marks the lowest inflows to index trackers since October 2024. Outflows from fixed income trackers were highest at £426 million.
Risk-on investors make the most of the US
Equities dominated fund flows in April as investors embraced a risk-on approach despite ongoing market volatility, driving £1.1 billion in overall net flows.
Despite April marking ‘Liberation Day’ and a month of rapidly evolving tariff negotiations, North American equities have continued to lead demand with inflows of £948 million. Investors have responded to market uncertainty by capitalising on price drops and ‘buying the dip’. Globally diversified equites also saw a similar boost, with inflows of £872 million.
Inflows to North America funds were split with £615 million to actively managed funds and £463 million to index trackers, showing investors are taking a mix of approaches to US equity exposure.
However, the impact of the Trump administration has been felt in emerging markets, with continued outflows of £296 million from Asian equities. With China particularly singled out by US trade policy, the region could be less appealing to some investors fearing the friction on trade caused by sky high tariffs: outflows from the China/Greater China sector rose to £121mn in April.
A tale of two investors, as European equities see second month of resurgence
While some investors embraced risk and sought to capitalise on a volatile market, a significant portion remain cautious. Inflows to money market funds were the highest of any asset class (£1.1 billion) in April. European equities also saw a second consecutive month of inflows of £106 million as investors looked to diversify their portfolio.
In the face of rapid policy changes coming from the US, Europe may be seen as a more predictable alternative as it commits to increase spending on defence and on infrastructure. For example, we are seeing major new spending initiatives in Germany where there is a commitment to investing to upgrade transport, energy and digital infrastructures.
North American equity net retail sales
Miranda Seath, Director, Market Insight & Fund Sectors at the Investment Association, said:
“A second consecutive month of net fund inflows suggests that investors do retain a degree of confidence, even as global economic uncertainty continues. Whilst part of the pickup in flows is seasonal – many people have been making the most of their £20,000 ISA allowance before the 5 April tax-year deadline – we are also seeing genuine momentum in the markets. Notably, those willing to take on more risk have been investing in North American equities, buying the dip as valuations have fallen. This helped to give April’s inflows an extra boost.
“We’re beginning to see investor behaviour split into two camps. Investors with a risk-on approach are putting their money into North American equities. Meanwhile, more cautious investors are favouring diversification away from US stocks into Europe and moving funds into lower-risk vehicles such as money market funds.
”Looking ahead, the outlook for global markets will remain unclear as long as uncertainty hangs over the economy and tariff policy remains changeable. If tariff threats do push up prices, central banks may delay cutting interest rates. That kind of scenario could mean that market turbulence persists.
“Closer to home, though, the recent UK-EU trade agreement is a promising development. The EU remains the UK’s biggest trading partner and our trade relationship is now on a firmer footing. It could open up selective opportunities for investors interested in UK assets.”
ENDS
APPENDIX
FUNDS UNDER MANAGEMENT AND NET SALES – April 2025
| Funds Under Management | Net Retail Sales | Net Institutional Sales | |
| April 2025 | £1.45 billion | £1.1 billion | -£3.8 billion |
| April 2024 | £1.47 billion | £3.2 billion | -£911 million |
BEST SELLING INVESTMENT ASSOCIATION SECTORS
The five best-selling Investment Association sectors for April 2025 were:
- North America with net retail sales of £1.08 billion.
- Global with net retail sales of £989 million.
- Short Term Money Market with net retail sales of £953 million.
- Volatility Managed with net retail sales of £557 million.
- Mixed Investment 40-85% Shares with £488 million.
The worst-selling Investment Association sector in April 2025 was UK All Companies which experienced outflows of £525 million.
NET RETAIL SALES BY ASSET CLASS
Money Market saw £1.1 billion in inflows.
Equities saw £962 million in inflows.
Mixed Asset saw £728 million in inflows.
Other saw £259 million in inflows.
Property saw £116 million in outflows.
Fixed Income saw £1.8 billion in outflows.
NET RETAIL SALES OF EQUITY FUNDS BY REGION*
North America saw net retail inflows of £948 million.
Global funds experienced inflows of £872 million.
Europe funds saw net retail inflows of £106 million.
Japan funds experienced outflows of £12 million
Asia funds experienced outflows of £296 million.
UK funds saw net retail outflows of £817 million.
TRACKER FUNDS
Tracker funds saw net retail inflows of £969 million in April 2025. Tracker funds under management stood at £363.8 billion at the end of April. Their overall share of industry funds under management was 25.0%.
RESPONSIBLE INVESTMENT FUNDS
Responsible investment funds saw a net retail outflow of £208 million in April 2025. Responsible investment funds under management stood at £95.9 billion at the end of April. Their overall share of industry funds under management was 6.6%.
