New figures show
UK equity funds are still seeing large outflows, while fixed interest and global equity funds continue to attract investors, according to Investment Association data for January released today.
Laith Khalaf, Senior Analyst, Hargreaves Lansdown:
‘Investors have started the new year in much the same vein as they ended the last. UK funds continue to leak assets, while money is still pouring into global equities and fixed income.
The bond paradox is still alive and well, as fixed interest funds once again attracted the most money, despite global monetary policy tightening. The lion’s share of this money is going into strategic and global bond funds which at least have the flexibility to move around the fixed income universe in search of opportunities, and protection if necessary.
The antipathy towards the UK is now so long in the tooth one has to question whether sentiment is truly reflecting prospects for the UK stock market compared to its global peers. The UK fund sectors are home to many talented managers and UK companies have diversified international income streams, so investors should make sure they’re not just following the herd if they’re thinking about ditching their UK holdings, and have considered reasons for doing so.’