Although there is always a seasonal lull in sales at this time of year the sale figures were bad compared with last summer. Gross retail sales fell to £2.3bn in July 2001 compared with £2.7bn in July 2000. Over the same period, gross sales of Isas fell to £564m compared with £703m.
Those retail investors who did invest in funds tended to favour the UK. Some 30% of all retail sales were in the UK All Companies sector compared with 25% in July last year.
Two other UK sectors were among the four most popular as measured by retail net sales: UK Other Bond at second and UK Corporate Bond at fourth. The North American Sector filled the
gap at third.
The least popular sector by the same criterion was Japan followed by Global Bonds and Far East Excluding Japan. Bucking the trend for retail investors to prefer investing at home, the UK Equity & Bond Income sector was fourth from bottom of the popularity list.
Positive news
However, there was some positive news for the fund management industry. Institutional investors – such as pension funds - were more upbeat than their retail peers with gross sales of £2.3bn in July 2001 compared with £1.8bn in July 2000.
As is often the case there was a substantial discrepancy in how institutional investors viewed particular sectors compared with retail investors. For example, the Japanese Smaller Companies sector was the fifth most popular in terms of institutional sales and Japan was the eighth most popular. The three least popular sectors all invested in smaller companies: European Smaller Companies, North American Smaller Companies and UK Smaller Companies.
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