The
stock
market
might
have
had
a
strong
February,
but
investors
do
not
seem
confident
in
a
continued
rally,
according
to
Morningstar
data.
Over
the
last
month,
funds
domiciled
in
the
UK
suffered
£3.34
billion
in
net
outflows
–
and
for
the
second
time
in
12
months,
not
a
single
asset
class
managed
to
attract
net
inflows.
Morningstar
manager
research
analyst
Giovanni
Cafaro
points
out
that
the
February
figures
further
extend
the
year-to-date
negative
outflows,
now
over
£5
billion,
amid
continued
market
uncertainty.
The
largest
withdrawals
were
from
allocation
categories
at
£1.22
billion,
followed
by
money
market
funds
at
£916
million.
That’s
the
biggest
monthly
outflow
for
the
asset
class
since
June
2023,
partially
reversing
the
inflows
posted
during
the
second
half
of
last
year.
Meanwhile,
the
£748
million
outflow
from
equity
strategies
brought
the
yearly
total
for
the
asset
class
to
£2.78
billion.
It
is
now
the
category
with
the
largest
outflows
so
far
this
year.
It’s
also
worth
noting
the
£255
million
of
outflows
from
property
strategies.
We’ve
covered
the
struggles
of
property
funds
before,
particularly
during
Covid-19,
when
many
of
these
previously-healthy
funds
had
to
suspend
withdrawals.
The
entire
asset
class
holds
about
£7
billion
in
total
and
so
far
this
year
its
outflows
are
surpassing
those
of
fixed
income,
an
asset
class
worth
roughly
£178
billion.
There
are
individual
categories
within
the
asset
classes
that
have
remained
attractive
to
investors,
however.
Year-to-date
inflows
into
Global
Large-Cap
Blend
Equity
funds
continue,
and
the
same
goes
for
India
Equity
and
Global
Emerging
Markets
Equity.
Other
Bond
and
GBP
Allocation
80%+
Equity
also
continue
attracting
investors.
At
the
other
end,
both
Global
Equity
Income
and
Global
Large-Cap
Growth
Equity
strategies
see
net
outflows.
As
does
Global
Flexible
Allocation
and
Other
Allocation.
GBP
Money
Market
–
Short
Term
accounted
for
almost
half
of
the
outflows
from
the
money
market
asset
class.
How
Are
Active
Funds
Doing?
Active
funds
are
also
out
of
favour.
In
February,
£6.6
billion
was
withdrawn
–
meaning
that,
just
two
months
into
2024,
investors
have
decided
to
remove
almost £10
billion (£9.81
billion
to
be
precise)
from
active
strategies
in
the
UK.
Passive
funds,
meanwhile,
had
another
positive
month,
with
£3.21
billion
added.
Fitting
with
the
theme
of
investors’
preferring
passive
strategies
to
active
counterparts,
BlackRock,
Legal
&
General,
Vanguard
and
HSBC
all
recorded
net
inflows.
BlackRock
alone
attracted
£1.64
billion.
Four
passive
funds
feature
in
the
top
five
inflows
for
February,
with
iShares
North
American
Equity
Index
topping
the
list
with
£500
million.
The
active
outlier
is
BlackRock
European
Dynamic,
with
net
inflows
amounting
to
£262
million.
Baillie
Gifford
continues
as
the
fund
house
with
the
largest
outflows
at
£974
million
in
February,
followed
by
Fidelity
International,
Abrdn
and
Schroders.
Do
Investors
Like
ESG
Funds?
Lastly,
another
continuing
trend
is
the
ongoing
inflow
into
sustainably-labelled
funds.
These
strategies
continue
to
see
inflows,
and
while
they
remain
modest
at
the
moment,
they
have
been
more
resilient
to
redemptions
over
the
past
12
months.
Those
with
a
sustainable
label
saw
£218
million
in
inflows,
while
those
without
suffered
£3.75
billion
in
withdrawals.
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