Good news doesn’t last as UK funds return to the red
Good news doesn’t last as UK funds return to the red
Investors withdrew £1.3bn from UK funds throughout May, ending the month of strong performance that the sector saw in April.
Since the start of 2024, UK investors have pulled £13.9bn from funds, bringing the total amount in UK funds below £1.1 trillion, according to data from Morningstar.
While passive funds still saw strong inflows , bringing in £2.8bn, a slight decline in them from last month and a £4.1bn loss for active funds was enough to bring flows into the negative.
Money market funds were the only sector that managed to bring in new money, gaining £557m throughout the month. The worst hit was equity funds, losing £783m, though they are the largest fund group, with £713bn of assets.
Equity strategies focused on the UK specifically were hit even harder, with outflows of £2.4bn, totalling over £10bn
The worst hit proportionally were property funds, losing £140m throughout the month despite having only £7bn in assets
Meanwhile, after sustainable funds brought in less money than average for the first time ever in April, they lost only £61m throughout May, compared to £1.3bn for non-ESG funds. Throughout 2024, they have brought in £1.5bn, while non-sustainable funds have lost £14.1bn.
Giovanni Cafaro, an analyst at Morningstar Manager Research and author of the report, commented: “The overarching trend of investors’ preference for passive offerings has also continued. This has been a tailwind for fund houses offering passive products, including BlackRock which saw a further £1.7bn of inflows in May, totalling £7bn for the year-to-date.”
The fund that brought in the most money last month was the newly launched JPM Global Focus Fund, with investors splashing £1.4bn into the fund.
In contrast, investors pulled £463m from the HSBC FTSE All-World Index Fund, £422m from the Royal London UK Core Equity Tilt Fund and £419m from the Aviva Investors Corporate Bond Fund.
Total estimated new money (£)
| Fund Groups | May 2024 | Year to date | Total assets |
| Blackrock | 1.8bn | 7bn | 112bn |
| Royal London | -351m | 360m | 70bn |
| Legal & General | 281m | 1.4bn | 65bn |
| Vanguard | 141m | 587m | 61bn |
| Fidelity International | -79m | -166m | 54bn |
| Abrdn | 176m | -511m | 49bn |
| HSBC | -277m | 1.5bn | 36bn |
| Baillie Gifford | -815m | -4.1bn | 33bn |
| Schroders | 91m | -577m | 31bn |
| M&G | -320m | -207m | 28bn |