Fixed income saw biggest outflows for two years in August

Falling profitsFixed income funds saw the largest outflows in sales since June 2013 at £333 million (€449 million), as investors fear interest rate hikes.

The Investment Association (IA) has released statistics for August which also show that equities continue to be the investors favoured asset class for the fourth month running with net retail sales of £503 million, despite China’s meltdown and subsequent market ructions.

UK equity funds were the best-selling in August with net retail sales of £719 million, compared to £35 million at the same time last year.

Europe was the second best-selling region for equity funds with net retail sales of £146 million.

Another asset class that saw a shift in investor sentiment was mixed asset, sales were down to £55 million compared to £449 million in July and was its worse month for sales since January 2009.

Total net retail sales were £690 million, their lowest since January 2015.

“Market volatility may have made investors more cautious in August, reinforcing a tendency for sales to dip over the summer period,” says Daniel Godfrey, chief executive of IA.

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