- Inflows of £1.6 billion in November 2024, marking a return to inflows following significant outflows in October and September.
- Equities saw inflows of £243 million in November 2024, after extensive outflows of £6.6 billion over the previous two months.
- Fixed Income funds also returned to inflow, with net retail sales of £524 million.
Net retail sales of investment funds returned to positive inflows of £1.6billion in November 2024, following the UK Budget and US election, according to data published by the Investment Association (IA) today.
The monthly inflow follows the two consecutive months of outflows in September and October, as investors took action to avoid the widely anticipated increase in capital gains tax in the UK Budget (£5.9 billion and £3.4 billion respectively).
Key findings for November 2024
- Equities saw inflows of £243 million in November, following extensive outflows of £6.6 billion over the previous two months. North American equities were most popular with net retail sales of £590 million, while global equities also saw an inflow of £400 million.
- UK equity outflows continued, although they fell to £552 million, the best figure since the £445 million outflow in August 2021.
- Fixed Income funds returned to inflow, with net retail sales of £524 million.
- Index tracker inflows remained strong at £1.9 billion. Actively managed funds remained in outflow with net retail sales of -£317 million, though this was the most reduced outflow since their last inflow in December 2021.
- Mixed asset funds saw minor outflows of £45 million.
Equities inflows – An American helping hand
Despite heavy outflows in previous months, investors turned their attention back to equities in November, contributing to overall net retail flows of £1.6 billion. Trump’s victory in the US election triggered a wider positive market reaction as markets priced in a more positive outlook for US equity returns given the Republican’s domestic growth and pro-markets agenda.
North America was the strongest selling IA equity sector in November, with total inflows of £428 million, as well as £162 million to North American Smaller Companies sector funds over the month.
Net retail sales by equity region, November 2023 to November 2024
Miranda Seath, Director, Market Insight & Fund Sectors at the Investment Association, said:
“Autumn was a tricky period for investors, with outflows driven by anticipated tax rises in the UK Budget. With the Budget and US election now in the rearview mirror, equities looked to be back in vogue in November, with investors favouring North America and Global equity funds. Outflows from UK equities also slowed to £552 million in November, the lowest they’ve been since August 2021.
“Investors will be watching closely to see what the year ahead holds. Trump’s pro-business agenda is likely to fuel US growth further, potentially leading to higher inflation. However, the prospect of uncertainty lingers, as potential tariffs could significantly impact global trade. In the UK, weaker economic data, combined with the introduction of national insurance contributions for businesses may also lead to price rises. In this climate, both the Bank of England and Federal Reserve are likely to be cautious about cutting rates.”
