View the article online at http://citywire.co.uk/money/article/a655127
Investors show 'clear shift' from bonds to shares
Rising popularity of equity funds fuels claims of a 'great rotation' out of bonds.
Sales of funds invested in shares out-stripped bond funds in each of the last four months of 2012, fuelling claims of a 'great rotation' into equities by yield-seeking investors.
While during 2012 as a whole fixed income funds were most in demand, attracting £5.6 billion in inflows, equity flows outstripped fixed income for each of the last four months of the year to total £3.4 billion.
Bonds have been popular for their perceived safety during the financial crisis. But some investors fear strong inflows are creating the conditions for a 'bubble'. This year investors are widely tipped to buy into dividend-paying shares as an alternative source of income.
The fund flows show a ‘clear shift’ in investor mindset, said Daniel Godfrey, chief executive of the IMA, the industry body that publishes the statistics.
The data comes amid questions over whether January's market rally in share markets can continue into the rest of 2013. Some market commentators are predicting a 'correction' in the near-future as the economic backdrop, while improved, remains weak.
News sponsored by:
Making the most out of Europe’s potential means seeing things differently. Learn more about how BlackRock’s focused approach to investing in Europe helps investors unlock the continent’s vast potential.
In this guide to investment trusts, produced in association with Aberdeen Asset Management, we spoke to many of the leading experts in the field to find out more.
More about this:
More from us
- Get ready for a 'Great Rotation' in stock markets
- Bullish investors set to pounce on bond-like shares
- The Accumulator: managers worry as markets threaten to overheat
- Does a great January mean a good year for the FTSE?
- David Kempton: I’ve sold all of my government bonds
Tools from Citywire Money
From the Forums
Weekly email from The Lolly
Get simple, easy ways to make more from your money. Just enter your email address below
An error occured while subscribing your email. Please try again later.
Thank you for registering for your weekly newsletter from The Lolly.
Keep an eye out for us in your inbox, and please add firstname.lastname@example.org to your safe senders list so we don't get junked.