We publish monthly industry-wide statistics about fund sales and funds under management.
Our fund flows information allows us to see what is happening in the UK retail fund market, as well as institutional investment in and out of funds. Data plays an important role in helping us to understand the funds industry and to evaluate significant market trends. To help members better understand how to interpret our data, we have compiled a list of FAQs. You can click on each FAQ to find answers to your burning questions. If we haven’t covered your query here, you can also email us at [email protected]
We publish monthly industry-wide statistics about fund sales and funds under management. Our fund flows information allows us to see what is happening in the UK retail fund market, as well as institutional investment in and out of funds.
Our monthly statistics reflect UK investor sentiment and include data on FCA-authorised unit trusts, open-ended investment companies and authorised contractual schemes, as well as some FCA-recognised offshore funds. Recognised funds are funds domiciled outside the UK that can be sold to UK retail investors and are typically EU UCITS funds. We do not include data on overseas investors.
One of the requirements of IA membership is that member firms submit their fund flow and funds under management data on a monthly basis. This data is published two months in arrears. We do not collect performance and charges data, performance and fee comparisons by sector are available from the major data vendors such as Morningstar and Refinitiv.
We collect data on around 4,500 funds, of which around 2,000 are overseas domiciled. The majority of these funds are available to individual investors through fund platforms, advisers or directly from investment firms. In our data we refer to these savers as retail investors. The list of funds also includes some funds that are aimed at larger investors such as an insurer or a workplace pension scheme; we refer to these investors as institutional.
We use the term ‘funds under management’ (FUM) to refer specifically to the amount invested in collective investment schemes, such as unit trusts and open-ended investment companies (OEICS). In the UK, these are referred to as authorised investment funds.
Wider assets under management (AUM), currently estimated at £10.0trn as at end 2021, include segregated accounts and insurance business conducted in different kinds of fund. Another key difference is that the AUM data reflects assets managed in the UK on behalf of overseas investors, whereas our funds under management data is reported on a UK investor basis and excludes overseas investors.
We classify funds into different sectors to help retail investors and financial advisers navigate the fund universe and to compare the funds within it. There are currently 55 IA sectors and these help investors to find certain types of fund based on their investment goals, such as growth or income. The sectors also narrow down the fund universe by type of asset, such as equities, bonds, or property.
Categorising funds into the sectors enables us to report data on sales and FUM at a more granular level and to identify key trends in investor behaviour. For example; we can group together all the sectors investing in UK shares such as UK All Companies, UK Equity Income or UK Smaller Companies to see if UK investors are pulling money out of funds investing in UK shares or channelling money in to them in any given month.
Each month small revisions to the figures may have been made since the previous release. This reflects additional information received. We therefore recommend referring to the latest set of data published, even if you are looking for data from an earlier month, as this is the most up-to-date.
We do not collect data on fund fees, but this is widely available from data vendors in the market including FE, Fitz Partners, Lipper Refinitiv and Morningstar.
Performance data is not collected by the IA, but by data vendors such as Morningstar, Refinitiv and FE, who use it to create IA sector ranking tables and calculate IA sector averages. We republish Morningstar’s latest sector performance data on our website. We do not provide a methodology for the calculation of sector average performance, believing it to be more appropriate for the commercial market to develop this.
We do not collect comprehensive data on new fund launches. Many of the funds looking to be included in the IA’s sectors will be new launches, but some will be established funds seeking sector classification for the first time.
We do not currently include data on ETFs in our fund statistics. In November 2018, we opened a consultation on the proposed inclusion of ETFs in the IA fund sectors. Just over 500 ETFs were admitted to the IA sectors in April 2021.
Consistent with the current approach, only ETFs that are EU UCITs with HMRC reporting fund status will be admitted. Initially, data on ETFs will not be incorporated into our monthly fund statistics, but it is our intention to start collecting and reporting ETF data in the future.
Our monthly fund statistics include data on FUM and net retail sales to index tracking funds. As mentioned above, ETFs are not included in this data (and it is worth noting that a small number of ETFs are active), but we will start to produce more data on ETFs going forward.
Our monthly fund statistics include figures on funds under management and net retail sales into ISAs. We collect this data directly from member firms and we also receive data on sales to ISAs from a number of investment platforms. The combined data from member firms and platforms represent approximately 60% of funds held in ISAs.
Each month, the IA reports data on a group of funds labelled ‘Unallocated’, which refers to the fact that these funds are not allocated to an IA sector. We also report data on funds in the IA’s Unclassified sector. Unallocated funds and funds in the ‘Unclassified sector’ are different and are reported on separately in IA data.
Funds in the IA Unclassified sector are part of the IA Sectors Framework. We provide details of funds in the Unclassified Sector in our Sector funds list, which can be found here. These include private funds and funds which fund managers consider inappropriate to compare with other funds. Some of these funds may also have been moved out of a sector for persistently failing to meet the sector definition requirements. As these funds are disparate, when we report data in our monthly fund statistics, we break down the Unclassified sector by asset class.
Unallocated funds are not part of the IA Sectors Framework and we do not publish details of these funds on our website (as we do for funds in the IA Sectors). We receive data on funds that are not allocated to the IA Sectors because it is a condition of IA membership that firms report monthly FUM, transactions and redemptions data for UK investors across their fund ranges. There are a host of reasons that fund managers may choose not to classify funds to an IA sector:
Unallocated fund flows are also broken down by asset class in the IA’s data.
Our monthly statistics report data on UK investors in UK and overseas domiciled funds, but data on overseas investors is not included. The only data that we collect and report on regarding overseas investors is the proportion of the FUM of UK domiciled funds held by overseas investors.
a. Do fund sales only relate to UK investors?
Yes, the data reported in our monthly fund statistics relates to UK retail investors. Data on institutional fund sales is reported in Table 4 of our monthly release.
b. Are foreign currency denominated share classes included in the IA sectors?
Yes, sector classification is at the fund level, not at the share class level, and as a result our data covers all share classes within the fund that are invested in by UK investors. This would include foreign currency denominated share classes and currency hedged share classes.
Today’s savers want to understand the impact of their investments on the world around them and it is therefore crucial that we capture the data on this increasingly important area of the investment management industry.
From January 2020, we have asked member firms to denote the funds that should be tagged as having responsible investment components in accordance with the IA’s Responsible Investment Framework, which launched in November 2019.
Responsible investment incorporates firm-level and fund-level components. The data presented on Responsible Investment funds is at the fund level where funds are pursuing one or more of the following responsible investment approaches and this approach is referenced in the fund documentation: exclusions; sustainability focus; impact investing.
We do not report data on funds that only apply ESG Integration or Corporate Engagement & Stewardship principles in our monthly statistics. This data is reported in the IA’s Investment Management Survey as these characteristics are typically at firm-level.
FUM in funds with responsible investment characteristics is 6.5% of total FUM, in September 2022 and FUM has grown substantially over the last 18 months. However, this is still a nascent area of investment management, albeit one that has gained significant focus in the UK and globally in recent years. The development of responsible investment approaches and the launch of new funds in this space will continue apace alongside growing investor interest. Collecting robust data will help us to track investor sentiment and the growth of responsible investing as it evolves and matures.