UK fund sales increased 35% gross in the first quarter of the year over the final quarter of 2011 driven mainly by personal pensions.
Q1 gross sales across the fund distribution universe totalled £25.3 billion (€31.6 billion).
The figure is a more modest 3% higher than fund sales in Q1 of 2011, data in the Distribution Report from Fundscape and Matrix Solutions show.
However, although rising gross sales are often an indicator of switching and transfers, in this case a quarter-on-quarter rise of 147% in net sales to £4 billion proved that business was far stickier than it had been in the previous quarter, the report notes.
Life & Pensions and Platform channels benefited the most due to a strong rise in personal pension business.
Helen Pridham, director of Fundscape, said: “Unusually for the first quarter of the year, ISAs were outsold by personal pensions due to rumours that the Chancellor was considering reducing pension tax relief for higher-rate tax-payers.”
In the Primary channel, flows through financial advisers increased by 24% over the quarter and accounted for 39% of the total distribution universe.
But the strongest rises in business were in the direct channels (direct to fund manager and business-to-consumer platforms), which tend to be at their highest in the first two quarters of the year because of the ISA season.
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