Investors move out of UK equities following Brexit vote

Retail investors are pulling out of property and UK equity funds in favour of global and Japanese equities following the UK’s vote to leave the EU last week.

Analysis by online investment platform, which has 3,068 funds available to investors, shows that trading was up 175% over the weekend, with 76% of withdrawals coming from property funds and 22% from UK equity funds. But when contacted, the company was unable to convert these percentages into sums of money.

The sectors most bought by users of the platform included global equities (56%), Japanese equities (16%) and North American equities (5%).

“UK investors’ fears about the prospects for property are striking. Clearly, there are worries that property would be affected by a possible economic downturn and the withdrawal of foreign investors,” said Stuart Dyer, Rplans chief investment officer.

However, Dyer went on to warn that investors should not be too “hasty” when it comes to reallocating assets in the wake of Brexit.

“Property and other asset classes have their roles to play in a balanced portfolio invested for the long term. Diversification helps to reduce both the impact of volatility and risk,” he said.

The level of new investments in UK funds on the platform were down 63% over the last month and down 46% over the last three months versus the same periods last year.  Levels are down 34% in the last six months versus the same period last year.

Meanwhile, investments into cash are up 411% in the last six months.

©2016 funds europe