As global stock markets closed their best quarter in at least a decade in Q2, fund flows suggested that investors preferred to bank their gains and take their seats on the sidelines.
Key highlights from this month's FFI:
- June saw the highest ever outflows from UK equity funds at £679m – the highest ever on record and an all-time high
- UK equity income funds also saw highest ever outflows on record at £671m
- June marked the worst ever performance for UK equity fund outflows – outstripping levels during the referendum, Brexit, lead-up to the General Election, and onset of the pandemic
- As investors bought heavily into the markets in April and early May, June saw them cash in quick on their profits, as the markets delivered their best performance in a decade
- The same trend was felt for all equity funds – investors added £3.9bn to equity funds between April and the first week of May, the biggest inflow on record in a two-month period
- But in June, they sold a net £1.2bn, banking profits they have made on the market rebound
- Active funds took most the impact, though passive funds saw rare outflows too, of £62m – the first month of outflow since October 2016
- Investors parked their cash in the safer options of fixed income and money market funds