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No panic from fund investors

Retail investment fund sales fell by over £300m in the second quarter of this year from the first quarter while Isa sales dropped by £160m from Q1, according to Ima figures.

Overall retail sales were £578m, down by £320m from sales in the first quarter of £900m but only £64.7m down from June 2001 sales of £642m.

Isa sales in the second quarter were £300m, down by £160m from £460m in the first quarter and by £164m from £464m in the second quarter of 2001.

There were fewer investors cashing in their funds in the first quarter, with £1.7bn repurchases compared with £1.9bn in Q1 and £1.9bn in Q2 last year. The IMA says this is evidence that despite the turbulent markets, investors are not reacting by pulling out of the market.

The UK corporate bond sector grew, reflecting investors&#39 desire to seek safe-haven investments.

Ima chief executive Richard Saunders says: “These figures show a continued positive inflow from retail investors, although at a lower level than last year. It is encouraging that, despite falling markets, there has been no significant inc-rease in repurchases, suggesting that investors are not indulging in panic selling.”

Baronworth Investment director Colin Jackson says: “The fact that Isa sales are down comes as no surprise. There is absolutely no confidence in the markets but hopefully people will not cash in their Isas as they will lose the tax breaks.”

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