Savers diversify, in early response to Coronavirus
Thursday 2 April 2020
UK savers invested £1.4 billion in retail funds in February 2020 according to latest figures published today by the Investment Association (IA).
- Net retail sales held stable at £1.4 billion in February.
- Mixed Asset funds were the best-selling asset class in February, with £711 million in net retail sales.
- Volatility Managed was the best selling IA sector in February, with £888 million in net retail sales.
- Responsible investment funds continued to grow in popularity, with £735 million in net retail sales, in a second consecutive month of record inflows.
Chris Cummings, Chief Executive of the Investment Association, said:
“Despite the growing global impact of coronavirus on economic activity, February in the fund market didn’t reveal any dents in investor confidence, as savers put £1.4 billion into funds across the month. However, caution was definitely in the air and savers top preference was for diversified funds, with Mixed Asset funds attracting £711 million.
“Few in February could have predicted the impact of a spate of lockdowns on global capital markets, or the extraordinary raft of measures from governments and central banks to help shore up economies around the world. It remains to be seen just how significantly steep market falls have affected investor behaviour in March.”
FUNDS UNDER MANAGEMENT AND NET SALES
| Funds Under Management | Net Retail Sales | Net Institutional Sales | |
| February 2020 | £1.3 trillion | £1.4 billion | -£3.2 billion |
| February 2019 | £1.2 trillion | £218 million | -£852 million |
BEST SELLING INVESTMENT ASSOCIATION SECTORS
The five best-selling Investment Association sectors for February 2020 were:
- Volatility Managed was first with net retail sales of £888 million.
- Mixed Investment 40-85% Shares was second with net retail sales of £355 million.
- £ Corporate Bond followed with net retail sales of £295 million.
- UK Gilts was fourth with net retail sales of £247 million.
- Global was fifth with net retail sales of £206 million.
The worst-selling Investment Association sector in February 2020 was £ Strategic Bond with an outflow of £664 million.
NET RETAIL SALES BY ASSET CLASS
Mixed Asset was the best-selling asset class in February 2020 with £711 million in net retail sales.
Money Market was the second best-selling asset class with £473 million of inflows.
Other (which includes the Targeted Absolute Return, Volatility Managed, and Unclassified sectors) was the third best-selling asset class with £422 million in net retail sales.
Property was next with £52 million in net retail sales.
Fixed Income experienced net retail outflows of £96 million, while Equity experienced net retail outflows of £210 million.
NET RETAIL SALES OF EQUITY FUNDS BY REGION*
Global was the best selling equity fund region in February 2020, with net retail sales of £230 million.
North America funds were the second best selling with net retail sales of £82 million.
All other equity fund regions experienced outflows.
Japan funds saw net retail outflows of £46 million in February.
Europe funds experienced net retail outflows of £57 million, while Asia funds saw net retail sales of £61 million.
UK funds experienced net retail outflows of £564 million.
TRACKER FUNDS
Tracker funds saw a net retail inflow of £1.6 billion in February 2020. Tracker funds under management stood at £220 billion as of the end of February. Their overall share of industry funds under management was 17.5%.
RESPONSIBLE INVESTMENT FUNDS
Responsible investment funds saw a net retail inflow of £735 million in February 2020. Responsible investment funds under management stood at £28 billion as of the end of February. Their overall share of industry funds under management was 2.2%.
GROSS RETAIL SALES BY DISTRIBUTION CHANNEL
In February, gross retail sales for UK fund platforms totalled £12.3 billion, representing a market share of 49%.
Gross retail sales through Other UK Intermediaries including IFAs were £6.7 billion, representing a market share of 26%.
Direct gross retail sales in February were £2.3 billion, representing a market share of 9%.
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 Channels
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 115,000 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 37% of all assets managed in Europe.
