Only £77m of net ISA sales occurred in July this year compared with over £279m in the same month last year – a huge 72% drop. Sales of these products also fell 36% from June.
The IMA said that one explanation of these sizeable outflows may be a falloff of investor confidence during a “stagnant market, coupled with increasing interest rates making cash an appealing alternative.”
Overall net sales also fell significantly. In July total net sales were £172m compared with £1.4 billion in July 2003. Investment dropped in both the retail and institutional arenas.
The most popular sectors for private investors were UK Equi
ty Income and Cautious Managed while the least popular were the Far East Excluding Japan and Europe Excluding UK.
However, institutional investors were more upbeat about the prospects for continental Europe. The Europe Excluding UK sector was the most popular for professional investors in terms of net sales. UK All Companies followed in second place. For these investors the least favourite sectors were UK Smaller Companies and UK Gilt.
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