UK funds under management hit a record high in 2013, while sales of equity funds tripled from 2012, Investment Management Association data has revealed.
Buoyant sales of equity and mixed asset funds helped funds under management increase 16% to £770bn between 2012 and 2013. Overall, net retail sales soared 43% from £14.3bn in 2012 to £20.4bn in 2013.
Equity fund sales tripled on 2012, with the highest net retail sales since 2000 at £11.4bn. Equity funds sold better than other asset classes every month since September 2012, with the exception of March 2013.
However, retail sales of fixed income funds plummeted – net outflows of £17m relegated the asset class to fifth place in terms of sales, compared to first in 2012.
At a regional level, global equity funds remained best-sellers for a sixth consecutive year, with net retail sales of £4bn.
The UK region saw a reversal of fortunes - in 2012 it was the worst-selling region for equity funds with an outflow of £944m, but in 2013 net retail sales of £2.9bn made it the second best-selling region. At the end of the year, funds under management had reached £222bn.
European equity funds also experienced a similar boost, with the highest net retail sales since 2000 at £2bn. These funds were the second worst-selling in 2012 when they saw an outflow of £478m.
Mixed Investment 20-60% Shares was the best-selling IMA sector for 2013, with net retail sales reaching a three-year high at £3.1bn. The worst-selling sector, Corporate Bonds, saw an outflow of £1.7bn - the lowest net retail sales ever recorded for the sector since its launch in 2008.
UK fund platforms accounted for just under half of retail distribution last year, compared to 45% in 2012 and 37% in 2010. Other intermediaries, including wealth managers and independent financial advisers, had a market share of 42% of gross retail sales.
IMA chief executive Daniel Godfrey said retail investors were highly active in 2013: “Equity funds took by far the largest share of the net inflows from investors.
"After a number of years with the strongest net sales, fixed income took no new money in 2013. Both mixed asset and property funds saw stronger inflows than in 2012.”
