As inflation starts to fall and the growth outlook has slightly improved, UK investor allocations to equities turned markedly positive in July, according to data published today by the Investment Association (IA).
Key findings for July 2023:
- Net retail sales topped £1 billion in July, with Equity funds returning to inflows with £816 million invested.
- Mixed asset funds and Fixed Income funds were also saw inflows this month of £861 million and £520 million respectively.
- £ Corporate Bond was once again the top-selling sector with net retail sales of £287 million.
- North American equity funds experienced a third month of outflows with £1.46 billion taken out from May to July.
Chris Cummings, Chief Executive of the Investment Association, said:
“As the rate of inflation starts to fall more markedly and recession expectations moderate, sentiment is becoming more positive. Whilst investors had been reducing their investments in recent months amidst a very unclear economic outlook, July saw net sales of just over £1bn. Equity, fixed income and mixed asset funds all benefited from this renewed optimism, with inflows into equity funds reaching £816 million – the highest since December 2021.”
FUNDS UNDER MANAGEMENT AND NET SALES
|Funds Under Management||Net Retail Sales||Net Institutional Sales|
|July 2023||£1.44 trillion||£1.0 billion||-£7.47 billion|
|July 2022||£1.43 trillion||-£106 million||-£9.35 billion|
BEST SELLING INVESTMENT ASSOCIATION SECTORS
The five best-selling Investment Association sectors for June 2023 were:
- £ Corporate Bond with net retail sales of £287 million.
- Volatility Managed with net retail sales of £251 million.
- Global Equity Income followed with net retail sales of £243 million.
- Corporate Bond with net retail sales of £209 million.
- Short Term Money Market was fifth with net retail sales of £132 million.
The worst-selling Investment Association sector in July 2023 was UK All Companies, which experienced outflows of £710 million.
NET RETAIL SALES BY ASSET CLASS
Mixed Asset funds saw inflows of £861 million.
Equity funds saw inflows of £816 million.
Fixed Income funds saw inflows of £520 million.
Property funds experienced £86 million in outflows.
Other funds saw £171 million in outflows.
Money Market saw outflows of £912 million.
NET RETAIL SALES OF EQUITY FUNDS BY REGION*
Global funds saw net retail inflows of £318 million.
Japan funds experienced inflows of £31 million.
Asia funds saw net retail inflows of £18 million.
Europe funds saw outflows of £47 million.
North America funds saw outflows of £470 million.
UK funds saw outflows of £1 billion.
Tracker funds saw net retail inflows of £702 million in July 2023. Tracker funds under management stood at £301 billion at the end of July. Their overall share of industry funds under management was 20.9%.
RESPONSIBLE INVESTMENT FUNDS
Responsible investment funds saw a net retail outflow of £39 million in July 2023. Responsible investment funds under management stood at £98 billion at the end of July. Their overall share of industry funds under management was 6.8%.
GROSS RETAIL SALES BY DISTRIBUTION CHANNEL
Gross retail sales for UK fund platforms totalled £13.1 billion, representing a market share of 34.8%.
Gross retail sales through other UK Intermediaries including IFAs totalled £12.4 billion, representing a market share of 32.9%.
Gross retail sales for Discretionary Manager totalled £1.7 billion, representing a market share of 4.6%.
Direct gross retail sales totalled £6.9 billion, representing a market share of 18.3%.
In July, Execution only intermediaries totalled £480 million in gross retail sales and accounted for 1.3% of the market.