Press Release
£25 billion - 2009 a record year for fund sales
2 February 2010
Investment fund statistics - December 2009 and 2009 summary
The Investment Management Association today publishes the figures for the fund management industry for December and the full year of 2009.
Key findings:
Fund sales highest on record - £25.8 billion net retail sales, 45 per cent above previous best year
The highest year end for funds under management - £480.8 billion
ISA sales of £2.8 billion - the best year since 2001
£ Corporate Bond the highest selling IMA Sector for 2009
Absolute Return the best selling IMA Sector for December, just beating Property
Richard Saunders, Chief Executive of the IMA, commented:
"2009 has seen investors adding to their savings at record rates. This trend can be traced back to the autumn of 2008 in the immediate aftermath of the Lehman crash and the ensuing market falls. Investors have prudently chosen wide diversification both across asset classes and geographically - in marked contrast to the previous record year of 2000. And it is good to see people once more investing via ISAs, after five years in which ISAs saw higher levels of withdrawals than investments."
UK DOMICILED FUNDS
SALES
2009 is the highest year on record for fund sales, with £25.8 billion in net retail sales - 45 per cent more than 2000 (£17.7 billion), the previous best year - and more than six times the level achieved in 2008 (£3.8 billion).
December 2009 saw net retail sales of £2.2 billion - the ninth consecutive month in which sales topped £2 billion. This was well ahead of the £1.5 billion achieved in December 2008.
FUNDS UNDER MANAGEMENT
2009 is highest year end to date for funds under management - £480.8 billion, exceeding the previous highest year end, 2007 (£467.0 billion), and a third (33 per cent) higher than 2008 (£361.7 billion). (Only once before do IMA figures show funds under management higher, when they reached £481.2 billion in October 2007.)
(See Table 2)
ASSET CLASSES
Bond sales dominated the first part of the year but Equities experienced a resurgence in the second half. Bonds finished the year 36 per cent ahead of Equities, with net retail sales of £9.9 billion, compared to £7.3 billion for Equities for the year as a whole.
In 2008, Bonds were also the most popular asset class with net retail sales of £2.8 billion. By contrast Equities, which were the least popular asset, experienced an overall outflow of funds in 2008 (£1.3 billion).
Absolute Return comprised over half (52 per cent) of the 'Other' asset class, with net sales of £2.5 billion.
Equities still comprise the majority (61 per cent) of funds under management (£293.1 billion) - although this has fallen from 83 per cent in the ten years since the end of 1999.
Bonds now comprise 20 per cent of funds under management, a figure that has increased markedly from 8 per cent ten years ago.
Property comprises 2 per cent of funds under management, a ten fold increase on 1999, when the figure was only 0.2 per cent.
(See Table 4)
IMA SECTORS
Absolute Return was the top selling IMA Sector in December 2009, with net retail sales of £511.0 million, just beating Property with £510.9 million, which had been the top sector for the two previous months.
£ Corporate Bond was the most popular IMA Sector during 2009 as a whole, topping the sales chart for eight months of the year (January to August), with total net retail sales of £6.0 billion for the year. Nearly £1 in every £4 invested in funds during 2009 (23 per cent) went into a fund in the IMA £ Corporate Bond Sector.
Absolute Return was the second most popular IMA Sector for the whole of 2009, and was the most popular in both September and December. Total net retail sales for the year were £2.5 billion, accounting for around £1 in every £10 invested in funds in the year (10 per cent).
Property came 4th overall for the year and accounted for £1 in every £16 invested in funds in 2009 (£1.6 billion in net retail sales). It came 1st in both October and November 2009, and was only narrowly beaten to the top slot by Absolute Return in December. This is a dramatic reversal of the position in 2008, when Property came 33rd, with a net outflow of funds of £466 million.
ISAs
ISA sales were the best year since 2001 - with net retail sales totalling £2.8 billion in 2009 (£2.4 billion in 2001). This is in contrast to the previous five years which all saw net outflows from ISAs, the highest of which was in 2008, which saw net outflows of £1.6 billion.
ISA funds under management reached £93.8 billion in December, the fifth highest month ever recorded. 2009 finished 27 per cent ahead of 2008 (£73.6 billion).
The most popular IMA Sector chosen for ISAs in 2009 was UK All Companies (£964 million gross retail sales), followed by Cautious Managed (£910 million), Unclassified (£805 million), £ Corporate Bond (£518 milion) and Protected (£480 million).
(See Table 2, Table 3 and Table 8)
INSTITUTIONAL FUNDS
2009 was the best year for institutional sales since 2006, with net sales of £3.8 billion (£5.5 billion in 2006).
In contrast to the retail market, Equities were the biggest selling asset class (£1.6 billion for Equities, £1.3 billion for Other, £0.9 billion achieved by Bonds).
December 2009 saw net institutional sales of £330 million. The leading asset class was Other (£340 million), driven by Absolute Return, followed by Equities (£270 million). Bonds saw a net outflow of £349 million.
(See Table 4)
OVERSEAS DOMICILED FUNDS
Overseas domiciled funds sold to UK investors in 2009 totalled £1.6 billion net retail, in contrast to the outflow of £663 million in 2008.
(See Table 6)
DISTRIBUTION
Intermediaries accounted for 87 per cent of all gross retail sales in 2009, slightly higher than the figure at the end of 2008, and much higher than ten years ago, when the figure stood at 49 per cent. (Intermediaries include IFAs, wealth managers and platforms.) The share of sales by direct sales forces and tied agents stands at 6 per cent, well down from the 27 per cent ten years ago. Direct business has also declined, standing at 4 per cent in 2009, compared to 18 per cent in 1999.
Direct sales forces and tied agents accounted for a much higher proportion of ISA sales (31 per cent, £3.1 billion) than they do for non ISA sales. The largest amount of ISA sales went through platforms.
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Investment Management Association
