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Global bond business hits record high

Demand for corporate bond funds doubled between June and July, according to the latest Investment Management Association statistics.

Having been the eighth most popular sector in net retail sales terms in June, the sector leapt to second in the rankings in July, with net inflows of £259.4m. In June, net retail sales for corporate bond funds stood at £130.3m.

Three of the top five most popular sectors in July were bond sectors. Global bonds topped the table with net retail sales of £360.9m, which the IMA says is the highest-selling month on record for the sector.

Inflows into the strategic bond sector hit £185.8m, ranking it fourth, with global growth in third place.

The unclassified sector was the least popular sector in July, with net outflows of £152.1m. The IMA says this is the sector’s biggest outflow since February 2008.

Overall net retail sales for July totalled £2.2bn, up by £100m from June.

Bonds were the leading asset class in July, taking £928m of net retail sales, up by £349m from June. Equity funds attracted inflows of £857m, their highest sales since November last year.

Skerritt Consultants head of investments Andrew Merricks says: “Unlike many, I never went off the attraction to bonds. They remain a good source of both income and growth for investors. My guess is it is not a problem with equities that has led to the surge but a disappointment in both government bonds and cash that has turned heads in the direction of the likes of corporate and global bonds.”

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