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View the article online at http://citywire.co.uk/wealth-manager/article/a731833

SLI tops fund sales league table as M&G falls out of top 10

by Dylan Lobo on Feb 03, 2014 at 11:53

SLI tops fund sales league table as M&G falls out of top 10

Standard Life Investments (SLI) won the retail net fund sales battle in 2013, as last year's victor M&G fell out of the top 10.

The pending departure of Invesco's star manager Neil Woodford and subsequent outflows to the funds he manages also contributed to Invesco failing to make the top 10 in the final quarter for the second successive year. This happened in spite of the firm pulling in £2.1 billion in gross sales over the period, according to the latest Pridham report.

SLI had a strong 2013 with net inflows of £3.4 billion, nearly double its closest rival Old Mutual Global Investors.  

Helen Pridham, editor of report, said: 'The group’s star attraction was its target absolute return product, the Standard Life Gars fund, which proved very popular with advisers and investors who wanted a low risk core to their portfolios.'

She added: 'Its fund-of-fund products have also gained traction among advisers looking to outsource their investment management.'

The news will prove particularly pleasing to SLI after recent upheaval in its Gars team, headed by Citywire A-rated Guy Stern (pictured), which saw the fund's architect Euan Munro join Aviva Investors and a team defect to Invesco Perpetual to launch a rival fund.

Meanwhile Old Mutual, which took in a net £1.82 billion in 2013, benefited from the recruitment of AA-rated Richard Buxton as it entered the top 10 for net fund sales in second spot. BlackRock rose from fourth to third, thanks to a £1.6 billion net inflow.

Other notable movers in the top 10 were Artemis, which attracted £1.5 billion in 2013, to take fourth spot, while Henderson drew in £1.02 billion to take seventh position. Both were new entrants to the top 10.

'Artemis saw its sales take off as equity income funds regained popularity and Henderson experienced a major turnaround in its fortunes,' Pridham said.

She added: 'After absorbing New Star and Gartmore, Henderson is finally back on form, helped by a resurgent interest among investors in property and European stock markets, which are areas where Henderson is seen as having particular expertise.'  

In terms of gross sales M&G topped the charts in 2013 with £9.6 billion as investors scooped up + rated Stuart Rhodes' M&G Global Dividend fund. However, due to redemptions elsewhere, primarily in the firm's fixed income range, the firm fell out of the top 10 in on a net sales basis in 2013. This compares with 2012 when M&G topped the table with a net inflow of £2.6 billion.     

Top ten managers by gross retail sales in 2013 (£m)
M&G £9,652.2
Invesco Perpetual £8,104.2
BlackRock £7,419.7
Schroders £7,376.2
Standard Life Investments £6,990.0
BNY Mellon £6,820.0
Threadneedle £5,016.6
Henderson £4,961.2
Fidelity £4,874.0
Jupiter £4,292.4
Top ten managers by net retail sales in 2013 (£m)
Standard Life Investments £3,471.0
Old Mutual Global Investors £1,817.6
BlackRock £1,630.6
Artemis £1,490.7
BNY Mellon £1,460.0
Cazenove (H1)* £1,159.3
Henderson £1,021.3
Schroders £980.2
AXA IM £878.3
Royal London £711.9

*Caznove’s figures for the first half of 2013 prior to its formal acquisition by Schroders.

The fourth quarter Woodford effect

Threadneedle and Royal London were among the biggest beneficiaries from the news that Neil Woodford is leaving Invesco Perpetual.

Woodford, the UK's dominant equity income manager, announced he was leaving Invesco Perpetual last October to set up a boutique this April. The news sparked major outflows across his £23 billion equity income franchise, with Invesco having to trim a number of holdings to cater for redemptions.

The report showed that Citywire AA-rated Leigh Harrison's and AAA-rated Richard Colwell's equity income business at Threadneedle, which includes the UK Equity Income and UK Equity Alpha Income funds, and Martin Cholwill's Royal London UK Equity Income funds were among the beneficiaries of the withdrawals.  

Net retail sales at Threadneedle shot up to £470.4 million in the fourth quarter versus £291.2 million in the corresponding period of 2012, lifting Threadneedle from seventh to fifth in the top 10 Q4 sellers.

Meanwhile Royal London made a rare appearance in the top 10 with a £444.5 million inflow to take seventh spot.

'Managers with strong equity income funds made progress in the fourth quarter, following the announcement of Neil Woodford’s departure from Invesco Perpetual. Among those groups which benefitted were Threadneedle and Royal London Asset Management,' Pridham said. 

'Leigh Harrison has a good reputation and I can't remember ever seeing Royal London in top 10, it's retail image is improving and it's really getting its act together.'   

Schroders topped the fund sales table in the final quarter of the year with £1.15 billion of net inflows. This, Pridham points out, was despite efforts to stem inflows into AAA-rated Julie Dean's Cazenove UK Opportunities fund, which was a best seller. Renewed interest in Japan also saw Schroder Tokyo fare well.

Meanwhile the pending departure of Woodford's contributed to Invesco failing to make the top 10 in the final quarter for the second successive year, despite pulling in £2.1 billion in gross sales over the period. 

Top ten managers by gross retail sales in Q4 2013 (£m)
Schroders £2,835.8
M&G £2,656.7
Invesco Perpetual £2,116.1
Standard Life Investments £1,837.6
Threadneedle £1,538.8
Henderson £1,534.1
BNY Mellon £1,486.0
SWIP £1,173.1
BlackRock £1,158.0
Fidelity £1,143.6
Top ten managers by net retail sales in Q4 2013 (£m)
Schroders £1,153.4
Standard Life Investments £813.7
Henderson £602.2
Artemis £523.8
Threadneedle £470.4
Old Mutual Global Investors £468.0
Royal London £444.5
AXA IM £392.6
BlackRock £382.2
SWIP £260.0

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