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 GroupsMay 2024Year to dateTotal assetsBlackrock1.8bn7bn112bnRoyal London-351m360m70bnLegal & General281m1.4bn65bnVanguard141m587m61bnFidelity International-79m-166m54bnAbrdn176m-511m49bnHSBC-277m1.5bn36bnBaillie Gifford-815m-4.1bn33bnSchroders91m-577m31bnM&G-320m-207m28bnSource: Morningstar