According to flows data from the Investment Association, investors pumped £991m into equity funds over the course of the month, a shift in tone from October’s £488m outflows.
Within the asset class, North America enjoyed the greatest regional sentiment boost, drawing £115m from investors, followed by Japan’s £47m, with the remaining regions all suffering outflows.
Money market funds enjoy ‘best year on record’ with £4.4bn inflows
Europe (£305m) and Global (£314m) funds took heavy losses, but the UK remains the outcast, suffering a further £819m of outflows in a single month.
By far the most popular way to access investments over November, tracker funds enjoyed their highest inflows since April 2021, bringing in £2.7bn and bumping their overall share of industry funds under management to 22.2%.
On a wider scale, industry FUM remains flat year-on-year at £1.39trn, although retail investors appear more bullish than institutional, adding £457m in the month, compared to institutional’s net £5.8bn outflows.
While money market funds enjoyed their best year on record in 2023, November was not a bright spot, with the asset class slipping to outflows as a net £319m was withdrawn, leaving it the worst performing asset class for the month.
Although equities enjoyed the greatest flows on an asset class basis, by IA sector, UK Gilts was the clear winner, bringing in net £548m for the month, followed by Infrastructure, which took less than half that figure (£241m), and High Yield Bond enjoyed £190m net inflows.
The worst-selling IA sector for November was Mixed Investment 20-60% Shares, which suffered £575m in outflows.
UK mixed asset funds suffer ‘unusually large’ outflows in November
Responsible investment funds remain in the doldrums, suffering further outflows as £459m left the sector, although the fund type still comprises 7% of industry funds under management, with £98bn committed.
UK fund platforms are the most popular distribution channel for investors, with gross retail sales of £13.3bn in November, a 45.5% market share.
Behind this are other UK intermediaries, with a 34.7% market share, discretionary managers at 4.9%, direct sales at 3.3% and execution-only intermediaries, which cornered just 0.3% of the market.
Chris Cummings, chief executive of the IA, said: “In November 2023, we saw savers return to put money into funds, as most asset classes bounced back after a challenging third quarter of the year.
“With inflation easing, there is a glimmer of hope on the horizon that we may see less restrictive monetary policy and cuts in central bank rates in 2024. The latest flow data suggest this has boosted both consumer confidence and wider market sentiment.”
