UK fund management industry achieves 12th consecutive month of positive net retail sales

The Investment Association’s monthly statistics of UK investor behaviour in July 2017 show:

• Net retail sales in July were £3.5 billion, making this the highest July net retail inflow on record
• Retail clients have invested £23.1 billion in UK authorised funds since the start of 2017
• July 2017 saw positive retail inflows across all asset classes except Money Markets

Chris Cummings, Chief Executive of the Investment Association, said: “The UK asset management industry continues to thrive in 2017 as July marked 12 consecutive months of positive retail inflows.”

Alastair Wainwright, Fund Market Specialist, said: “Net retail sales in July were £3.5 billion, making this the highest July net retail inflow on record. So far this year, retail clients have invested £23.1 billion in UK authorised funds, already surpassing annual net retail sales in both 2015 (£16.9 billion) and 2016 (£6.8 billion).

There were positive retail inflows across all asset classes except Money Markets, which saw its first monthly outflow since January 2016. Fixed Income funds proved to be most popular with a net retail inflow of £1 billion. £ Corporate Bond was the second best-selling sector with £432 million of net retail sales.

Mixed Asset funds attracted £958 million of net retail money in July with flows being more or less equally positive across all Mixed Asset Sectors. There have only been three monthly outflows from the asset class in the last five years. Mixed Asset products were also most popular within the passive space with £212 million of net retail investments.

Equity funds posted another positive monthly retail inflow of £924 million. The Global equity sector was once again the most popular sector with £607 million in new retail investments. UK equity funds experienced outflows of £290 million, as UK investors’ preference to invest overseas continued.”

FUNDS UNDER MANAGEMENT AND NET SALES

	Funds Under Management	Net Retail Sales	Net Institutional Sales
July 2017	£1.1 trillion	£3.5 billion	£257 million
July 2016	£996 billion	-£419 million	£523 million

ASSET CLASSES

Fixed Income was the best-selling asset class in July 2017, with net retail sales of £1 billion.

Mixed Asset was the second best-selling with net retail sales of £958 million.

Equity was the third best-selling asset class with net retail sales of £924 million.

Property funds saw inflows of £32 million, while Money Market funds saw outflows of £124 million.

NET RETAIL SALES OF EQUITY FUNDS BY REGION*

Global equity funds were the best-selling in July with net retail sales of £737 million.

European equity funds were the second best-selling with net retail sales of £350 million.

Japanese equity funds were the third best-selling with net retail sales of £92 million.

Asian funds experienced a net retail sales of £44 million

Region	Net retail sales in June 2017	Average net retail sales for previous 12 months
Global	£737 million	£527 million
Europe	£350 million	-£136 million
Japan	£92 million	£31 million
Asia	£44 million	-£72 million
North America	-£20 million	£62 million
UK	-£290 million	-£322 million

THE INVESTMENT ASSOCIATION SECTOR RANKINGS

The five best-selling Investment Association sectors for July 2017 were:

• Global was the best-selling sector with net retail sales of £607 million.
• £ Corporate Bond with net retail sales of £432 million.
• Europe Excluding UK with net retail sales of £285 million.
• Targeted Absolute Return with net retail sales of £275 million.
• Volatility Managed with net retail sales of £200 million.

The worst-selling Investment Association sector in July 2017 was the UK All Companies sector with an outflow of £214 million.

Investment Association Sector	Ranking in July 2017	Net Retail Sales in July 2017	Ranking in June 2017	Net Retail Sales in June 2017	Asset Class
Global	1	£607 million	1	£466 million	Equity
£ Corporate Bond	2	£432 million	7	£223 million	Fixed Income
Europe Excluding UK	3	£285 million	9	£186 million	Equity
Target Absolute Return	4	£275 million	2	£451 million	Other
Volatility Managed	5	£200 million	10	£174 million	Other

RETAIL DISTRIBUTION

In July, gross retail sales for UK fund platforms totalled £8.4 billion, representing a market share of 47.5% (46.7% in July 2016).

Other Intermediaries including UK IFAs and Wealth Managers attracted gross retail sales of £3.8 billion, representing a market share of 21.4% (24.8% in July 2016).

Direct gross retail sales in July were £1.3 billion, representing a market share of 7.6% (7.4% in July 2016).

FUND PLATFORM PRODUCT SALES

For the five fund platforms that provide data to The Investment Association (Cofunds, Fidelity, Hargreaves Lansdown, Old Mutual Wealth and Transact) we saw net retail sales of £1.3 billion in July.

Personal Pensions had net sales of £730 million, ISAs £333 million, and Unwrapped £167 million, and Insurance Bonds £41 million.

For the same five fund platforms, funds under management as at the end of July 2017 were £247 billion, compared with £213 billion a year earlier.

ISAs**

In July 2017, funds in ISAs provided by fund companies and the five fund platforms that feed data to The Investment Association (Cofunds, Fidelity, Hargreaves Lansdown, Old Mutual Wealth and Transact) saw net retail inflows of £147 million.

The three best-selling sectors for ISAs based on the five fund platforms were:

• Mixed Investment 20-60% Shares (£107 million net sales)
• Global (£41 million net sales)
• Mixed Investment 40-85% Shares (£40 million net sales)

FUND OF FUNDS

Funds of funds had a net retail inflow of £817 million in July 2017.

Funds of funds that invested externally saw net retail sales of £337 million, while funds that invested internally saw net retail sales of £480 million.

Funds under management for funds of funds were £143 billion at the end of July 2017, accounting for 12.6% of industry funds under management, compared with 11.9% in July 2016.

TRACKER FUNDS

Tracker funds saw a net retail inflow of £555 million. Tracker funds under management stood at £155 billion as at the end of July 2017. Their overall share of industry funds under management was 13.7%, compared with 12.7% in July 2016.

ETHICAL FUNDS

Net retail sales of ethical funds were £129 million in July 2017. Funds under management were £14 billion at the end of July, representing a 1.2% share of industry funds under management.

-ENDS-

For further information, please contact:

Helen Ayres
Media Relations Manager
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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 may 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:

Asia	Europe	Global	Japan	North America	UK
Asia Pacific excl. Japan	Europe Excl. UK	Global	Japan	North America	UK All Companies
Asia Pacific incl. Japan	Europe Incl. UK	Global Emerging Markets	Japanese Smaller Companies	North America Smaller Companies	UK Equity Income
China/Greater China	Europe Smaller Companies	Global Equity Income			UK Smaller Companies
		Specialist
		Technology and Telecommunications

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 (Cofunds, 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:

• The Investment Association is the trade body that represents UK investment managers who manage over £5.7 trillion on behalf of clients
• 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.