UK retail funds reach record £871bn

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Assets in investment funds have reached a record high of £871bn in 2015 despite ongoing market turmoil, according to the latest figures form the Investment Association.

Funds under management have increased by £36bn from 2014, although net retail sales dropped £4bn year-on-year to £17.6bn in 2015.

Investment Association interim chief executive Guy Sears says: “Despite market uncertainty surrounding China, commodity prices and central bank interest rate policy throughout 2015, we saw funds under management of authorised investment funds hit an all-time high of over £870bn.”

Net retail sales for December were £1.9bn rising from £1.3bn in October and £1.6bn in November.

The Investment Association also saw record net retail sales of tracker funds in 2015 of £5.4bn with funds under management hitting an all time high of £108bn.

Across 2015 equity was the best-selling asset class for the second consecutive year with net retail sales of £8.4bn although slightly down from £8.7bn in 2014.

Money market funds saw record net retail sales of £591m in 2015, increasing £63m since 2014.

Sears says: “After a slow start, net retail sales bounced back in the final three quarters of the year with investors favouring equity products, particularly European funds and those with an income focus.”

This contrasts with fixed income funds, which saw a record net outflows of £519m in 2015, compared to an inflow of £1.5bn in 2014.

Within sectors, UK equity income was the best-selling sector for the second year running with net retail sales of £4.3bn, closely followed by Targeted Absolute Return with £4bn of retail sales in 2015.