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Woodford leads way in tough 2015 for fund sales
Investors continued to pile into the Woodford Equity Income fund in what proved a weak year for fund sales.
Woodford Investment Management was a popular home for investors' cash in 2015, which proved to be the weakest 12 months for net retail fund sales in three years.
While gross fund sales hit a new record in 2015, a rise in redemptions meant net retail sales were down 19% on the previous year, according to the Pridham report into sales of open-ended funds and unit trusts.
Market volatility in the second half of the year prompted many investors to sell up with panic over China’s economic health, rising US interest rates and plunging commodity prices combining to send markets tumbling.
Woodford Investment Management, founded by Citywire AAA-rated star fund manager Neil Woodford (pictured), took in the most net money over the year at £3.3 billion (see table below), although this inflow was 15% below 2015’s figure of £3.9 billion.
‘Its sales were underpinned by a variety of factors, not least the high profile of its founder, along with the popularity of equity income funds which was boosted by the advent of pension freedom,’ the report’s author Helen Pridham said.
|Net retail sales in 2015|
|Woodford Investment Management||£3.3bn|
|Standard Life Investments||£3.1bn|
|Old Mutual Global Investors||£1.9bn|
|Legal & General||£1.4bn|
|Seven Investment Management||£1.2bn|
BlackRock came out on top in terms of gross sales, attracting £10.7 billion as its exchange-traded fund range maintained its attraction to investors, along with its mixed assets funds.
‘BlackRock continues to benefit from the popularity of its passive fund range but these accounted for a lower proportion of its flows in 2015,’ Pridham said.
‘One of the areas that it saw most progress last year was in the sales of its mixed asset funds.’
|Gross retail sales in 2015|
|Standard Life Investments||£8.6bn|
|Old Mutual Global Investors||£5.9bn|
|Legal & General||£5.7bn|
However, redemptions left BlackRock’s net sales at £2.2 billion, representing a fall from third spot in this table after topping it in 2014.
It was a tough year for M&G Investments, which saw its gross flows fall from £9 billion in 2014 to £6.7 billion last year, resulting in a fall from second to fifth place in the table. This decline was in part due to falling demand for Richard Woolnough’s M&G Optimal Income fund.
New M&G chief executive Anne Richards, who is joining the from Aberdeen Asset Management later this year, will be hoping to arrest the slide.
It was a good year for Standard Life Investments, which took second spot for both gross and net sales, attracting £8.6 billion and £3.1 billion respectively.
A major contributor to this was a resurgence in flows into its £27 billion Global Absolute Return Strategies fund, although this only accounted to a third of gross and net inflows. Bambos Hambi’s MyFolio fund of funds range and the group's UK Equity Income Unconstrained and European Equity Income funds also drew in investors.
New entrants in the net retail sales table included Legal & General Investment Management, Seven Investment Management and Fidelity.
‘Legal & General Investment Management has seen its business boosted by strong flows into its passive products and a popular property fund offering . 7IM’s multi asset products have found increasing favour [and] Fidelity is back on form thanks to improving performance,’ Pridham said.
The trio replaced HSBC Global Asset Management, Fundsmith and Royal London in the top 10.
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- CF Woodford Equity Income A Acc
- M&G Optimal Income A Inc
- Standard Life Inv Glo Abs Ret Strategies Inst Acc
- Standard Life Inv UK Equity Inc Unconstr Inst Acc
- Standard Life Inv European Equity Income Ret Acc
- Legal & General UK Property R Acc (PAIF)
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by Chris Sloley on Jan 18, 2017 at 07:00