Purchases of investment companies on adviser platforms grew 1% in 2022, compared to a 7% drop in purchases of all products, according to new data.

Net demand for investment companies jumped 48% to reach an all-time high.

That’s according to the latest figures compiled for the Association of Investment Companies (AIC) by ISS Financial Clarity.

They revealed that purchases of investment companies on adviser platforms reached a record high of £1.31bn in 2022.

That was against the background of a general decline in purchases of all products on adviser platforms, according to the data.

Overall purchases in 2022 fell 7% to £183.82bn, the biggest year-on-year fall since the AIC’s records began in 2011.

Net demand for investment companies jumped from £320m to an all-time high of £474 million, an increase of 48%.

The most popular sector was the Flexible Investment sector, which accounted for 16% of all purchases of investment companies.

Second was UK Smaller Companies, which jumped from 26th place in 2021. That was despite a widening of the average discount in the sector from 8% to 11%.

 The Global sector ranked third by net demand, followed by Renewable Energy Infrastructure and Infrastructure.

Nick Britton, head of intermediary communications at the AIC, said: “Last year, investment companies saw their discounts widen in difficult markets, but this does not appear to have dampened demand from financial advisers and wealth managers.”

He said the jump in popularity of the UK Smaller Companies sector suggests that the deeper discounts on offer may have attracted some bargain hunters.

He said: “The big picture is that demand for investment companies has remained resilient against a backdrop of declining platform purchases overall.”

Tough markets will always hit share prices and deepen discounts, but advisers are clearly looking beyond that to the strong long-term record of many investment companies and their ability to bounce back when markets recover, Mr Britton added.