Savers continue to desert British stocks despite piling record amounts of money into equity funds, it was revealed yesterday.
Industry figures show Britons put an unprecedented £7billion into such investments in the first quarter of the year as they looked to cash in on rising stock markets.
A record £5.7billion was ploughed into North American equity funds over the three-month period, according to the figures from global funds network Calastone.
But at the same time, UK investors withdrew £2.1billion from domestic holdings.
Contrasting the relative attractions of US and UK funds, Calastone head of global markets Edward Glyn said: ‘The US earnings recession is over.
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Profits are once again on the up. UK equities are certainly cheap. But investors worry where the growth is going to come from.’
The figures come amid soul-searching in the City and among investors about the health of the London stock market and the low values put on British companies.
That has left London-listed firms vulnerable to foreign bidders in what Peel Hunt this week described as a ‘feeding frenzy’.
Peel Hunt’s Charles Hall warned that if the ‘relentless’ assault continued, the FTSE Small Cap Index could cease to exist by 2028 because there will be no firms left outside the top 350 that make up the FTSE 100 and FTSE 250.
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