IMA: Record sales for Global Bond sector in Q3

Global Bond was the top selling retail sector in September with inflows pushing the category to its best ever quarterly showing in Q3.

Investor appetite for bonds shows no signs of slowing with the asset class as a whole ranking as the best seller for the third month running, according to IMA figures.

Net retail sales for bonds were £914m over the month and £3bn over Q3 2010. This is near the peak levels seen in the first half of 2009, when sales were over £3bn in both quarters. Equities were the second highest selling asset class in September at £760m with net retail sales totalling £2.1bn in Q3.

Global Bonds saw net retail sales of £348m in September, while net retail sales for the sector were £974m for Q3.

As in the past three months, three of the top five sectors were bond sectors in September: £ Corporate Bond, Global Bonds and £ Strategic Bond.

However, Asia Pacific ex Japan experienced a big rise in popularity to become the third most popular sector with net retail sales of £216m, up from 19th position the previous month.

The worst selling sector in September was UK All Companies, which saw a net outflow of £75m.

Overall, September saw net retail sales of £2.4bn, the highest level since this time last year and above the monthly average of £2.1bn for the past 12 months.

Year-to-date net retail sales totaled £17.9bn, just behind the record level of £18.9bn in January to September last year.

Net ISA sales for September totalled £95.4m, the lowest level since February last year.

Funds under management in September reached a new record of £542.6bn, largely due to a strong rise in equity markets. The FTSE 100 closed at 5,549 at the end of September 2010, 6% up on the end of August.

IMA chief executive Richard Saunders says: "Investors continued to add significantly to their holdings in September, with net retail sales now surpassing the £2bn mark in 15 of the past 18 months.

"In the last quarter, bond funds have again proved popular, with net sales of £3bn, close to the peaks of the first half of 2009.

"In contrast to last year, when the higher income £ Corporate Bond sector dominated bond sales, investors are now adopting a diversified approach across actively managed bond sectors.

"Indeed, Q3 was the highest selling quarter on record for the Global Bonds sector, though investors continued to steer clear of UK gilts funds.

"Overall, net retail sales in the first nine months of 2010 were only slightly behind the record levels seen in 2009."