IA fund flows data: Investors dump equities as economic uncertainty continues

4 August 2022

IA fund flows data: Investors dump equities as economic uncertainty continues

Investors took £4.5 billion out of funds in June 2022, according to data published today by the Investment Association (IA) – the highest monthly outflow of the year so far and the second highest on record.

• June IA data shows largest fund outflows this year
• Equity funds saw the largest outflows of £2.3bn
• Responsible investment funds bucked the trend to take £71m in June

Emma Wall, Head of Investment Analysis and Research, Hargreaves Lansdown

“Ever rising inflation, the continued atrocities in Ukraine, and Central Bank rate hikes across the world have all knocked investor confidence in June – leading to fund outflows of £4.5bn. This is the worst figure so far this year – and the second worst monthly outflow on record.

Equity funds were the least popular sector, as investors sought to reduce risk amidst the uncertainty. Global funds, which have been extremely popular over the past five years, were the worst hit. Mixed-asset funds also suffered, though those that target volatility were in inflow mode – one of the very few sectors attracting cash as investors prepare for yet more market jitters. Responsible investment funds also bucked the trend, taking £71m in the month of June.

July fund flow tables for Hargreaves Lansdown clients show that some optimism has returned in the last month, as markets regained some earlier losses, particularly tech and US markets. However, the most bought funds also include those with a focus on capital preservation showing that confidence remains low, and investors are steeling themselves for a bumpy ride.”