Investors pull record £27.9bn from UK funds amid political turmoil
Investors pulled a record £27.9bn from UK funds last month as the disastrous mini-budget and political turmoil sent shockwaves through the markets, new data has revealed.
All asset classes were hit by outflows in September, with equity funds suffering the heaviest blow as more than £13.6bn was pulled by investors, according to research from investment data firm Refinitiv Lipper.
Alternative assets bore the second heaviest outflows at £5.1bn while funds holding bonds were hit by £4.7bn worth of redemptions.
Head of Lipper Research for UK and Ireland Dewi John said it was a”record breaking month” as everything from “equities to cash sold off”.
“Surprisingly, no single month during the global financial crisis comes close,” he said.
John added that there had been no “rush for cover in money market funds” from investors due to the “corrosive effect of inflation on cash.
“While it’s not possible to tell where capital is being deployed from these figures, paying off mortgages would seem a reasonable guess,” he said.
“Or stockpiling tinned food.”
More than £25.2bn was pulled from actively managed funds in the month, almost 10-times that of passive funds which track indices.
Volatility in the markets in the past quarter has hit money managers in the UK and caused sharp falls in assets under management at some of the City’s top investors.
Schroders last week revealed its assets had fallen by nearly £21bn in the three months to September, while Jupiter reported a £1.4bn fall in its AUM at the end of September, one day after FTSE 250 investor Liontrust said more than £1.6bn had been pulled from its funds.