UK authorised and recognised funds have seen £2.1bn of outflows in November as all but two sectors posted negative net sales.
Data from the Investment Association published this morning (January 10) showed funds under management had remained at £1.2trn in the year but new retail sales had tanked from net inflows of £4.5bn in November 2017 to net outflows of £2.1bn a year later.
Mixed Asset was the best-selling asset class with £350m in net retail sales in the month, followed by Property with £19m net sales.
The remaining asset classes experienced outflows.
Fixed Income bore the brunt with net retail outflows of £1.2bn, while the Money Market saw outflows of £230m, and equities suffered a £467m deficit.
Other asset classes, including Targeted Absolute Return and Volatility Managed, experienced outflows of £637m.
Chris Cummings, chief executive of the Investment Association, said: "Global uncertainty has led to a doubling-down of investor caution in November.
"A combination of international trade tensions, ongoing Brexit uncertainty, and the market volatility seen from October onwards, have clearly dented confidence.
"Fixed Income funds experienced a second month of significant outflows, which, alongside the declining appeal of UK and European Equity funds, contributed to the largest net retail outflow since the EU referendum of £2.1bn."
The best-selling Investment Association sector for November 2018 was the Mixed Investment 40-85 per cent shares with £216m net sales. The worst was Targeted Absolute Return with an outflow of £756m.
Meanwhile ethical funds experienced net retail inflows of £83m in November 2018.
Funds under management were £16bn at the end of November, representing a 1.4 per cent share of industry funds under management.
The Investment Association's figures for fund sales cover sales in authorised unit trusts and open ended investment companies (OEICs) provided by its membership. The figures do not include investment trusts and ETFs.
Alistair Cunningham, financial planning director at Wingate Financial Planning, said: "I expect 2019 will see more volatility but that’s not necessarily a bad thing if it’s a generally 'up' direction.
"I think for most investors with diverse portfolios Brexit is a red herring – much of the reason for volatility is more global and especially focused on the current situation in the US.
"Other than educating clients about the uncertainties I do not think that much is different this year than in the prior year."
carmen.reichman@ft.com
