UK investors took £282 million out of funds in December 2022, in the tenth month of net retail outflows of 2022, according to data published today by the Investment Association.
This takes total retail outflows for 2022 to £25.7 billion. This is the first time that an annual outflow has been recorded, with the next lowest sales total coming in 2008 during the Global Financial Crisis at £4.2 billion. Over 2022, responsible funds bucked the trend of outflows, seeing £5.4 billion inflows throughout the year and tracker funds also saw annual inflows of £11.0 billion.
Key findings for December 2022 include:
- Equity funds saw outflows soften to £33 million, despite outflows from UK equity funds of £1.1 billion. Fixed Income Funds saw inflows of £389 million, down from last month’s £1.4 billion inflow.
- Tracker funds were also in inflow this month at £696 million, down from November’s £1.6 billion, which was the highest inflow into tracker funds in 2022.
- North America was the bestselling IA sector for the second month in a row, seeing inflows of £358 million. UK All Companies saw the highest outflow again in December at £1.0 billion.
- Responsible investment funds saw modest inflows of £9 million, following last month’s £148 million outflow.
Chris Cummings, Chief Executive of the Investment Association, said:
“December was a quiet month for investor activity, and funds closed out the year on a modest outflow. Despite outflows easing across equity funds, investors continued to take money out of UK equities, against the backdrop of the challenging economic forecast for the UK.” “UK retail investors faced a challenging year in 2022, as inflation soared following the Russian invasion of Ukraine, which caused energy and supply shocks. Investors grappled with a cost-of-living crisis and returns from stocks and bonds falling in tandem. Funds saw outflows in 10 months out of 12 last year, with £25.7 billion withdrawn through the year, a record annual outflow. As the December data shows, the significant outflows we saw earlier in the year are easing. With markets rebounding at the start of 2023 and the outlook for bond investing improving, there are glimmers of hope that investor confidence will increase in the first quarter of 2023.” FUNDS UNDER MANAGEMENT AND NET SALES
|Funds Under Management||Net Retail Sales||Net Institutional Sales|
|December 2022||£1.4 trillion||-£282 million||-£2.7 billion|
|December 2021||£1.6 trillion||£2.3 billion||-£903 million|
BEST SELLING INVESTMENT ASSOCIATION SECTORS
The five best-selling Investment Association sectors for December 2022 were:
- North America with net retail sales of £358 million.
- Global was second with net retail sales of £237 million.
- UK Gilts followed with net retail sales of £127 million.
- Targeted Absolute Return was fourth this month with net retail sales of £107 million.
- Global Equity Income remained in fifth with net retail sales of £98 million.
The worst-selling Investment Association sector in December 2022 was UK All Companies, which experienced outflows of £1.0 billion.
NET RETAIL SALES BY ASSET CLASS
Fixed Income funds saw inflows of £389 million.
Other funds (which includes the Targeted Absolute Return, Volatility Managed, and Unclassified sectors) saw £293 million in inflows.
All other asset classes experienced outflows this month.
Equity funds saw outflows of £33 million.
Property funds experienced £93 million in outflows.
Mixed Asset funds saw outflows of £116 million.
Money Market saw outflows of £721 million.
NET RETAIL SALES OF EQUITY FUNDS BY REGION*
North America funds saw net retail inflows of £366 billion.
Global funds saw inflows of £224 million.
Asia funds saw inflows of £42 million.
All other equity regions experienced outflows this month.
Japan saw outflows of £104 million.
Europe funds saw outflows of £243 million.
UK funds saw outflows of £1.1 billion.
Tracker funds saw net retail inflows of £696 million in December 2022. Tracker funds under management stood at £284 billion at the end of December. Their overall share of industry funds under management was 20.7%.
RESPONSIBLE INVESTMENT FUNDS
Responsible investment funds saw a net retail inflow of £9 million in December 2022. Responsible investment funds under management stood at £91 billion at the end of December. Their overall share of industry funds under management was 6.7%.
GROSS RETAIL SALES BY DISTRIBUTION CHANNEL
Gross retail sales for UK fund platforms totalled £9.0 billion, representing a market share of 48.3%.
Gross retail sales through other UK Intermediaries including IFAs totalled £ 5.7 billion, representing a market share of 30.9%.
Gross retail sales for Discretionary Manager totalled £1.5 billion, representing a market share of 7.8%.
Direct gross retail sales totalled £674 million, representing a market share of 3.6%.
In December, Execution only intermediaries totalled £108 million in gross retail sales and accounted for 0.6% of the market.