- Investors flee markets, withdrawing £1.6bn in October
- Just two UK Equity Income funds delivered a positive return this year
The latest Investment Association figures show where investors allocated money in October.
Laura Suter, personal finance analyst at investment platform AJ Bell, comments:
“Investors fled from markets in October, with net outflows of £1.6bn in the month, compared to inflows of £5.3bn in October last year. Bond markets were hardest hit, accounting for £1.6bn of net outflows. Fears about falling property prices and the impact of Brexit on the sector led to investors selling £39m in property funds, which had their biggest outflows since August last year.
“Investors pulled another £214m from UK equity funds in the month, continuing a year of heavy outflows for the funds – now topping £10.8bn. But this may have been a savvy move as only two funds in the UK Equity Income sector have delivered a positive return this year* – Schroder Income and Schroder Income Maximiser – all others have handed investors losses.
“Meanwhile, in the UK All Companies sector – the largest sector by far – just seven funds have delivered a positive return to investors, with the remaining 200 all delivering a loss. This is not a complete shock as the FTSE 100 is down 10% in the year so far, while the FTSE 250 is down 12%.
“The Targeted Absolute Return sector was the worst selling of the month, with investors pulling £705m from the funds. This is the fourth consecutive month of outflows, but the outflows are vastly higher than previous months, which were £470m combined.”
* Data from 1/1/18 to 5/12/18, based on funds over £50m. Source: FE
