Record £7.1bn flows into responsible investment funds in 2020 so far
Thursday 5 November 2020
UK savers put £5.3 billion into retail funds in Q3 2020, more than three times the net retail sales of Q3 2019 (£1.2bn), according to latest figures published today by the Investment Association (IA). The other key findings:
- Responsible investment funds saw net retail sales of £7.1bn for the year-to-date. This is up from £1.9bn for the first three quarters of 2019.
- Bond funds continued to see strong net retail sales reaching £1.2 billion in September, boosted by the Global Bond sector’s record sales of £937m.
- Active funds saw positive net retail sales of £336m in September 2020, while net retail sales to tracker funds remained consistently strong at £1.3bn.
Chris Cummings, Chief Executive of the Investment Association, said:
“The year so far has seen record investment into responsible investment funds, with over £7bn invested into funds which consider their wider impact on the world. In a year clouded by uncertainty, responsible investment funds are a beacon for how savers can put their money to work to support positive change globally, and our industry can be proud that these funds are reaching new heights of popularity.
“It is also heartening that since the significant outflows in March, net retail sales have continued to recover into September. It remains to be seen just how significantly new COVID-19 restrictions and lockdowns imposed across the UK and internationally will affect investor behaviour as we head towards the end of 2020.”
FUNDS UNDER MANAGEMENT AND NET SALES
|Funds Under Management||Net Retail Sales||Net Institutional Sales|
|September 2020||£1.3 trillion||£1.6 billion||-£1.3 billion|
|September 2019||£1.3 trillion||£1.1 billion||-£3.2 billion|
BEST SELLING INVESTMENT ASSOCIATION SECTORS
The five best-selling Investment Association sectors for September 2020 were:
- Global Bonds was first with net retail sales of £937 million.
- Global was second with net retail sales of £474 million.
- Mixed Investment 40-85% Shares followed with net retail sales of £390 million.
- Volatility Managed was fourth with net retail sales of £185 million.
- UK Gilts was fifth with net retail sales of £94 million.
The worst-selling Investment Association sector in September 2020 was Targeted Absolute Return with an outflow of £266 million.
NET RETAIL SALES BY ASSET CLASS
Fixed Income was the best-selling asset class in September 2020 with £1.2 billion in net retail sales.
Mixed Asset was the second best-selling asset class, with £423 million of inflows.
Money Market funds experienced £281 million of inflows.
Property funds however experienced £18 million in net retail outflows.
Equity funds followed with net retail outflows in September of £93 million.
Other funds (which includes the Targeted Absolute Return, Volatility Managed, and Unclassified sectors) experienced £161 million of net retail outflows in September.
NET RETAIL SALES OF EQUITY FUNDS BY REGION*
Global was the best-selling equity fund region in September 2020, with net retail sales of £184 million.
North America funds were second, seeing net retail inflows of £69 million.
Europe funds came next with net retail inflows in September of £40 million.
Asia funds experienced net retail outflows of £8 million.
Japan funds saw net retail outflows of £145 million.
UK funds saw net retail outflows of £321 million.
Tracker funds saw a net retail inflow of £1.3 billion in September 2020. Tracker funds under management stood at £239 billion as of the end of September. Their overall share of industry funds under management was 18.1%.
RESPONSIBLE INVESTMENT FUNDS
Responsible investment funds saw a net retail inflow of £975 million in September 2020. Responsible investment funds under management stood at £40 billion as of the end of September. Their overall share of industry funds under management was 3%.
GROSS RETAIL SALES BY DISTRIBUTION CHANNEL
In September, gross retail sales for UK fund platforms totalled £11 billion, representing a market share of 48%.
Gross retail sales through Other UK Intermediaries including IFAs were £6.8 billion, representing a market share of 29%.
Direct gross retail sales in September were £1.3 billion, representing a market share of 6%.
For further information, please contact:
Katie Martin, Head of Communications: [email protected]
T: +44 (0)20 7269 4655
Helen Ayres, Communications Manager: [email protected]
T: +44 (0)20 7269 4620
David Parton, Communications Executive: [email protected]
T: +44 (0)20 7269 4625
IA press office: [email protected]
T: 020 7269 4696
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 investment management, supporting British savers, investors and businesses. Our 250 members manage £8.5 trillion of assets and the investment management industry supports 113,000 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 over a third (37%) of all assets managed in Europe.