Record outflows were seen in UK equities in May, fresh data shows.
Latest data from the Investment Association showed there were outflows overall in equities but the picture in UK equities worsened with record outflows of £1.8bn in May.
It said: “May outflows further an established trend of outflows from UK equity funds, with £13.6bn withdrawn in 2023, and £12nbn in 2022.
“Diversification of portfolios remains a driving factor in UK equity outflows. Investors and their advisers continue to reallocate outside of the UK, with strong inflows for global, Europe and North American funds.”
Since 2016, £54bn has been withdrawn from UK equity funds, according to the body.
Earlier this week, the Financial Conduct Authority announced it would overhaul its listing rules to make it more straightforward for companies to list on the UK stock market.
Laith Khalaf, head of investment analysis at AJ Bell, said: “Even more troubling for UK asset managers is the fact the trend seems to be accelerating.
“The FCA has just issued a fresh set of reformed listing rules in a bid to encourage companies to launch on the UK stock exchange.
“Whether that works or not, it’s unlikely to have any impact on retail fund flows, which do not ebb and flow based on the number of companies listing in London.
“There are deep structural changes in the way retail investors buy funds which have led to the exodus from UK equities.”
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