The Investment Association’s UK Equity Income sector was the most popular among Cofunds customers in May, but investors could be drawn to fixed-income funds in future.
The Property sector was knocked into second place in May, followed by Targeted Absolute Return, Mixed Investment 40-85 per cent Shares and Mixed Investment 20-60 per cent Shares.
Britt Holland-Ellice, head of fund group relations for Cofunds, said: “Given current market volatility, it is no surprise to see the prominence of funds that aim to deliver regular, stable returns, predominantly from the lower-risk and flexible, multi-asset style sectors.”
She added: “We expect it will be worth keeping a close eye on the popularity of fixed-income funds and the more flexible strategic bonds, especially as we near the point where the US and UK consider raising interest rates.”
|Ranking for May||IA sector|
|1||UK Equity Income|
|3||Targeted Absolute Return|
|4||Mixed Investment 40-85% Shares|
|5||Mixed Investment 20-60% Shares|
Marvin Evans, principal of Gloucestershire-based Old Bank Wealth Management, said: “I tend to use model portfolios, but I can understand why people are going into equity income, as long as they are investing for the long term.”