In no other calendar year have net retail sales for UK funds totalled a negative figure, according to an Investment Association (IA) report published yesterday (February 2).
UK investors continued to withdraw their savings from funds last year, but the pace of outflows had slowed considerably by October.
The figure [£25bn] is so starkly at odds with what went before that it requires at least one double take.Laith Khalaf, AJ Bell
Source: Investment Association
The IA report also showed UK equity funds suffered £12bn of outflows, following predictions that these funds were set to post their highest level of outflows in a decade.
"It’s been a dark year for the UK’s fund management industry, with money flying out of the door by the boatload," said AJ Bell's head of investment analysis, Laith Khalaf.
"2022 was the worst year for fund sales on record by a country mile, totally eclipsing other weak periods that occurred following the dotcom crash, around the Brexit vote, and in the depths of the financial crisis.
"The figure [£25bn] is so starkly at odds with what went before that it requires at least one double take."
Khalaf said the pain for the investment management industry is compounded by £24.4bn of institutional fund outflows, taking the total net outflow for the year to an "astonishing" £50.1bn.
There are no guarantees, but history shows us that the best years can often follow the worse.Dzmitry Lipski, Interactive Investor
Funds research head at Interactive Investor, Dzmitry Lipski, said with bonds falling alongside shares, and an all-round difficult year book ended with major political and economic turbulence, there were few places for UK investors to hide.
But Lipski was quick to highlight the build up which led to last year's fund sale performance.
“It  comes after a roller coaster three years of social, emotional, economic and market turbulence – we are living in an age of uncertainty," he explained.
“The new year bounce has shown how quickly sentiment can change, and some of last years outflows may already be working their way back into markets.
"There are no guarantees, but history shows us that the best years can often follow the worse. It’s so important to try to get out of the habit of buying high and selling low."