Sales of overseas-domiciled funds in the UK market leapt in July, the Investment Management Association (IMA) reported, touching their highest monthly total since it began publishing data in 2007.
Net retail sales in the UK of open-ended funds with distributor status domiciled outside the UK and sold to British investors totalled £280m in July, more than six times June’s £44.2m, and a dramatic change from the same month a year earlier, when there was a net outflow of £91.3m, the IMA said.
Over the past year, the worst month for overseas-domiciled funds was October 2008, when net outflows totalled £203.8m.
Overseas funds under management also rose in July, by 6% from the end of June and 16% from a year earlier to £21.1bn, the IMA said.
However, the IMA highlighted that part of the reason for assets rising was down to it covering a greater portion of the offshore funds market selling into the UK. When it began collecting data in 2006, it only covered around 50% of the market. The data now includes 75% of the market.
Other key points:
• The £21.1bn held in overseas-domiciled funds at the end of July was about one-twentieth the £412.6bn FUM held in UK domiciled funds. A year earlier, FUM of overseas domiciled funds was almost 1/23rd the UK figure, suggesting the overseas category may be growing relatively faster.
• Similarly, overseas FUM in July 2009 was 16% above the equivalent figure in July 2008, while in UK domiciled funds, FUM have still not caught up with last July’s total. (That £412.6bn figure is still 0.6% below last July’s level.)
• Among UK-domiciled equity funds, the sector with the greatest inflows in July was Asia Pacific excluding Japan, where net retail sales totalled £250.7m. The Europe excluding UK sector saw the greatest outflows, with investors withdrawing some £36.6m.
Charts containing the July retail sales data and other information may be found on the IMA’s website at http://www.investmentuk.org/press/2009/stats/stats0809.asp.
