Bonds bounce back as net retail sales top £5.5 billion in Q2
Thursday 1 August 2019
The Investment Association (IA), the trade body that represents UK investment managers, has today published figures on how savers invested in June.
- Net retail sales experienced a third consecutive month of inflows, with savers placing £2.3 billion into funds
- Fixed income was the highest selling asset class for the fourth month in a row; net retail sales reached £2.4 billion
- Tracker funds inflows have reached £5.7bn in Q2, the highest quarterly inflows on record, significantly higher than the previous high of £3.4bn recorded in Q2 2017.
- £ Strategic Bond was the best selling IA Sector in June, with net retail sales of £1.1 billion.
Chris Cummings, Chief Executive of the Investment Association, said:
“2019 has so far been a game of two halves in the fund market. Following £900 million of outflows in the first quarter, savers returned in the second quarter to place £5.5 billion into funds. Bond funds in particular saw a dramatic bounce back following the sell-off in the fourth quarter of last year, with net inflows of £4.8bn in the second quarter of 2019.”
“The picture is less positive for UK equities with political uncertainty remaining high. The brief respite from outflows in May proved short-lived and the year-to-date has been characterised by ongoing outflows.”
FUNDS UNDER MANAGEMENT AND NET SALES
BEST SELLING INVESTMENT ASSOCIATION SECTORS
The five best-selling Investment Association sectors for June 2019 were:
- £ Strategic Bond was the best-selling sector with net retail sales of £1.1 billion.
- £ Corporate Bond was second with net retail sales of £453 million.
- Global was next with net retail sales of £402 million.
- Global Bonds followed with net retail sales of £359 million.
- Mixed Investment 40-85% Shares was fifth with net retail sales of £275 million.
The worst-selling Investment Association sector in June 2019 was Targeted Absolute Return with an outflow of £502 million.
NET RETAIL SALES BY ASSET CLASS
Fixed Income was the best-selling asset class with £2.4 billion in net retail sales.
Mixed Asset was the second best-selling asset class with net retail sales of £417 million.
Money Market was the third best-selling asset class with £197 million in net retail sales.
Property and Other (which includes the Targeted Absolute Return, Volatility Managed, Protected and Unclassified sectors) saw net retail outflows of £101 million and £158 million, respectively.
Equity saw net retail outflows of £474 million in June.
NET RETAIL SALES OF EQUITY FUNDS BY REGION*
North America funds were the best-selling in June with net retail sales of £265 million.
Asia funds were the next best-selling with net retail sales of £68 million.
Global funds experienced net retail inflows of £7 million.
Japan funds saw net retail outflows of £19 million, followed by Europe funds which experienced net retail outflows of £124 million.
UK funds experienced net retail outflows of £744 million.
Tracker funds saw a net retail inflow of £1.6 billion. Tracker funds under management stood at £209 billion as of the end of June 2019. Their overall share of industry funds under management was 16.7%.
Ethical funds experienced net retail inflows of £234 million in June 2019. Funds under management were £19 billion at the end of June, representing a 1.5% share of industry funds under management.
GROSS RETAIL SALES BY DISTRIBUTION CHANNEL
In June, gross retail sales for UK fund platforms totalled £8.9 billion, representing a market share of 39%.
Gross retail sales through Other Intermediaries including UK IFAs were £7.6 billion, representing a market share of 34%.
Direct gross retail sales in May were £1.4 billion, representing a market share of 6.0%.
For further information, please contact:
Helen Ayres, Communications Manager: [email protected]
T +44 (0)20 7269 4620; M +44 (0)7508 724 066
David Parton, Communications Executive: [email protected]
T +44 (0)20 7831 0898
IA press office: [email protected]
Notes for Editors
To see a breakdown of the data referenced in this press release, please see all of the tables here.
The Investment Association's figures for fund sales cover retail and institutional sales in authorised unit trusts and open ended investment companies (OEICs) provided by our membership to UK investors. The figures do not include investment trusts and ETFs.
Each month small revisions to figures have been made since the previous press release. This reflects additional information received by The Investment Association.
Net retail sales comprise total retail sales minus repurchases (including switches between funds), thus the figures can result in a negative figure or outflow.
* Regional breakdown for equity funds
The following Investment Association sectors have been grouped together to compile the figures for regional equity sales:
Direct includes sales forces and tied agents, private clients and other direct to investor sales without intermediation.
** The Investment Association’s ISA figures are based on information collected from fund companies and five fund platforms (AEGON, Fidelity, Hargreaves Lansdown, Old Mutual Wealth and Transact) where they are the ISA provider. Fund business through other ISA providers such as wealth managers is not included. The Investment Association’s figures cover about three-quarters of the whole of the market for funds held in ISAs.
About the Investment Association (IA):
- The IA champions UK asset management, supporting British savers, investors and businesses. Our 250 members manage £7.7 trillion of assets and the asset management industry supports 100,000 jobs across the UK.
- Our mission is to make investment better. Better for clients, so they achieve their financial goals. Better for companies, so they get the capital they need to grow. And better for the economy, so everyone prospers.
- Our purpose is to ensure investment managers are in the best possible position to:
- Build people’s resilience to financial adversity
- Help people achieve their financial aspirations
- Enable people to maintain a decent standard of living as they grow older
- Contribute to economic growth through the efficient allocation of capital.
- The money our members manage is in a wide variety of investment vehicles including authorised investment funds, pension funds and stocks and shares ISAs.
- The UK is the second largest investment management centre in the world, after the US and manages 35% of all assets managed in Europe.