Falls in inflation and a better growth outlook improved investor sentiment, the IA said.

Key figures for July were: 

• Net retail sales topped £1 billion in July, with Equity funds returning to inflows with £816m invested  
• Mixed asset funds and Fixed Income funds saw inflows of £861m and £520m respectively 
• £ Corporate Bond was once again the top-selling sector with net retail sales of £287 million 
• North American equity funds experienced a third month of outflows with £1.46 billion taken out from May to July 

Total funds under management in July were slightly higher compared to 2022 at £1.44 trillion (July 2022: £1.43 trillion).

IA chief executive Chris Cummings said:   “As the rate of inflation starts to fall more markedly and recession expectations moderate, sentiment is becoming more positive.

“Whilst investors had been reducing their investments in recent months amidst a very unclear economic outlook, July saw net sales of just over £1bn. Equity, fixed income and mixed asset funds all benefited from this renewed optimism, with inflows into equity funds reaching £816 million – the highest since December 2021.” 

BEST SELLING INVESTMENT ASSOCIATION SECTORS   

The five best-selling Investment Association sectors were:  

1. £ Corporate Bond with net retail sales of £287 million. 
2. Volatility Managed with net retail sales of £251 million.  
3. Global Equity Income followed with net retail sales of £243 million.  
4. Corporate Bond with net retail sales of £209 million.  
5. Short Term Money Market was fifth with net retail sales of £132 million.  

The worst-selling Investment Association sector in July was UK All Companies, which experienced outflows of £710 million.  

NET RETAIL SALES BY ASSET CLASS  

Mixed Asset funds saw inflows of £861 million. 

Equity funds saw inflows of £816 million. 

Fixed Income funds saw inflows of £520 million.  

Property funds experienced £86 million in outflows. 

Other funds saw £171 million in outflows. 

Money Market saw outflows of £912 million. 

NET RETAIL SALES OF EQUITY FUNDS BY REGION  

Global funds saw net retail inflows of £318 million. 

Japan funds experienced inflows of £31 million. 

Asia funds saw net retail inflows of £18 million.  

Europe funds saw outflows of £47 million.  

North America funds saw outflows of £470 million.  

UK funds saw outflows of £1 billion. 

Source: IA

Tracker funds saw net retail inflows of £702 million in July 2023. Tracker funds under management stood at £301 billion at the end of July. Their overall share of industry funds under management was 20.9%. 

Responsible investment funds saw a net retail outflow of £39 million in July 2023. Responsible investment funds under management stood at £98 billion at the end of July. Their overall share of industry funds under management was 6.8%.  

Gross retail sales for UK fund platforms totalled £13.1 billion, representing a market share of 34.8%. Gross retail sales through other UK Intermediaries, including IFAs, totalled £12.4 billion, representing a market share of 32.9%. 

Gross retail sales for Discretionary Managers totalled £1.7 billion, representing a market share of 4.6%. Direct gross retail sales totalled £6.9 billion, representing a market share of 18.3%. In July, execution-only intermediaries totalled £480 million in gross retail sales and accounted for 1.3% of the market.