Net retail sales slump in November, says IMA

The Investment Management Association has reported a year-on-year slump in net retail fund sales to £267m, the lowest level since October 2008 and a big fall from November 2010’s £1.8 billion net retail sales.

Slow growth was contributed to by the highest outflows on record for equity funds during November 2011, the most recent data available shows.

Outflows of £864m were reported during November, the fourth month of outflows in the past five months. It compares with an average inflow of £506m over the past year.

Bond funds were the highest-selling asset class for the third month running, with net retail sales of £443m.

IMA chief executive Richard Saunders says: “The second half of 2011 has seen a marked slowdown in fund sales from the exceptionally strong levels of the last three years, and there was no let-up in November, which saw the lowest monthly net sales since October 2008.

“Investors favoured bond funds in November, while sales of absolute return funds bounced back from previous low levels. Equity funds experienced significant outflows, mainly from UK, European and North American equity funds.”

There was also bad news for ISA sales with outflows of £28m in November, the highest outflow since February 2009.

The IMA cautious managed sector was the best-selling, attracting inflows of £176m, followed by the IMA absolute return – UK sector, which witnessed net retail sales of £164m.

The lowest selling sectors were the specialist, North America, Europe ex-UK, UK Smaller Companies and UK all companies sectors, which saw combined net outflows of £728m.