Sales were up from £504m in March and were boosted by the ISA season.

Global remained the best-selling sector, with net retail sales of £1.3bn, the highest since £1.8bn in April 2021.

Inflows into tracker funds reached a new record of £3.8bn, exceeding the previous high of £3bn in November 2020.

While investors favoured equity trackers (£2.6bn in April), all asset classes saw inflows to tracker funds across April, including fixed income and mixed assets at £842m and £287m respectively.

April was the first month for positive inflows into mixed asset funds since March 2022, totalling £376m. Inflows were concentrated to mixed investment 40-85% shares which has historically been the most popular selection among investors.

Inflows into North American equity fell from £662m in March to £278m in April. The sustained rally in US equities since November 2023 faltered as robust economic data from the US led to expectations for rate cuts being pared back.

Responsible investment outflows remained neutral at £12m in April.

Miranda Seath, director, market insight & fund sectors at the Investment Association, said: “The positive inflows for April signal the green shoots of investors’ increasing confidence.”

She said the sharp rise in inflows could partly be attributed to the new tax year, with strong ISA sales during April as investors sought to maximise their personal allowances.

Laith Khalaf, head of investment analysis at AJ Bell, said: “Retail investors put more into funds in April than they have since August 2021, which points to some confidence returning to the UK funds market, though it remains to be seen whether this is the start of a sustainable trend or a blip.

“April is normally a positive month for fund sales as ISA season hits its crescendo, and with the number of higher rate taxpayers set to hit 7 million in the next few years, it’s not surprising to find investors filling their boots with valuable tax shelters.”

Looking ahead, Ms Seath said: “As we head to the polls in the UK on July 4th, it remains to be seen how the UK election will impact investor attitudes, particularly the extent to which it will influence investor demand for UK equities, which have remained in outflow through Q1.

“The next elected government will have limited fiscal headroom and will be required to balance competing spending priorities, but despite these constraints, there will be an opportunity to restore stability to the UK economy as UK inflation continues to calm and we see tentative growth.”

She said the outcome of the November elections in the US will arguably be the most significant for markets. “Regardless of who wins, we could see increasingly protectionist policies linked to boosting American industries.”