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Embargoed: 12.00pm:   Monday 26 July 1999

INVESTMENT FUND SALES UP 19% ON PREVIOUS MONTH BUT REGULAR SAVINGS SALES PROVE DISAPPOINTING

  • Total investment funds under management rose to £214.7bn in June 1999
  • Gross unit trust and OEIC sales of £3.731bn up 21% on June 1998 (£3.076bn)
  • 10.4% drop in number of UT and OEIC regular savings plans
  • Gross ISA sales for June up 15% to £589mn (£513m in May 1999)
  • ISA funds under management boosted to £1.7bn
The investment fund industry saw assets under management grow to £214.7bn at the end of June. The rise in total gross sales of 19% to £3.7bn, compared with £3.1bn for last month, was an improvement of 21% on the same period last year. The UK sectors continue to be the main winners with retail investors, but Europe excluding UK and North America also proved popular. PEP funds under management rose to £57.6bn, with just under £200mn worth of transfer business undertaken in June. The second quarter regular savings figures show that the total number of regular savings plans has reduced by 10.4%. There has also been a 38% drop in sales, with total sales of £316.1mn compared with £515.3mn for the first quarter. It appears that a significant number of monthly PEPs have not been switched into ISAs.Regular savings into stocks and share ISAs have some way to go before they catch up with their PEP counterparts. Sales in the second quarter fell by 43% to £243.6mn compared with £431mn of PEP regular savings plans in the first quarter of this year.ISA gross sales are up by 15% on May’s figures and total funds under management reached £1.7bn. As previously predicted, there has been a change in distribution channels, with IFAs responsible for 39% of the business, salesforces 37% and direct 16%. When ISAs were first introduced in April, salesforces and tied agents accounted for 68% of sales and IFAs for only 16%. Commenting on the latest set of statistics, Anne McMeehan, Director of Communications at AUTIF, said:
"Whilst it’s good to see total investment fund sales going so well, it’s clearly disappointing to see such a fall off in regular savings. We don’t believe this is a conscious effort by the public not to invest on a regular basis, but unlike bad habits, the savings habit is all too easy to quit!"The long term rewards of regular savings into unit trusts and OEICs, with or without an ISA wrapper, considerably outperform the short term comforts of traditional deposit accounts. You can get free information from AUTIF’s information service on 0181 207 1361."

Additional Note to Editors:
Please refer to our previous press release dated 12 July 1999, which compares deposit account returns with equity and bond funds.

Regular Savings Plans: Q2 1999 (1st April 1999 to 30th June 1999) Plans:

  Q1 98 Q2 98 Q3 98 Q4 98 Q1 99 Q2 99 Q3 99 Q4 99
PEP/ISA 1,273,589 1,548,076 1,648,484 1,748,146 1,759,588 1,342,113    
Non-PEP/ISA 225,006 229,737 236,435 246,502 256,867 465,112    
Total 1,498,595 1,777,813 1,884,919 1,994,648 2,016,455 1,807,225    

Sales: £mn

  Q1 98 Q2 98 Q3 98 Q4 98 Q1 99 Q2 99 Q3 99 Q4 99
PEP/ISA £332.8 £352.2 £374.8 £396.6 £431.0 £243.6    
Non-PEP/ISA £40.5 £41.1 £43.6 £54.8 £84.3 £72.5    
Total £373.3 £393.3 £418.4 £451.4 £515.3 £316.1    

Note: Figures represent totals for the quarter, not monthly totals within the quarter.

Summary Table: June Unit Trust, ISA and PEP Sales

June 99 May 99 June 98
Total fund value £214.7 bn £204.9 bn £185.7 bn
PEP fund value £57.6 bn £55.2 bn £46.6 bn
ISA fund value £1.701 bn £1.027 bn
Accounts 13.2 mn 13.0 mn 10.5 mn
Gross sales £3,731.1 mn £3,124.2 mn £3,076.5 mn
Repurchases £2,680.6 mn £2,248.0 mn £2,302.7 mn
Total net sales £1,050.5 mn £876.3 mn £773.8 mn
Net retail sales £891.9 mn £729.9 mn £771.3 mn
Net institutional sales £158.6 mn £146.4 mn £2.5 mn
Net PEP sales £-113.3 mn £-117.7 mn £569.8 mn
Net ISA sales £585 mn £511 mn

For further information please contact:

Anne McMeehan, Director of Communications, AUTIF, 0171 831 0898
Michael Quach, Head of Statistics, AUTIF, 0171 831 0898
Clare Arber, PR Manager, AUTIF, 0171 831 0898

Notes to Editors:

Best selling funds in June Net Retail Sales
UK General Bonds, UK All Companies

Net Institutional Sales
UK General Bonds, Global Growth

Worst selling funds in June Net Retail Sales
UK Gilt, UK Equity Income

Net Institutional Sales
Far East Specialist, Europe Excl UK

PEPs:
The tables detailing stocks and flows via PEPs relate to plans operated by unit trust managers only and not to plans operated by all PEP Plan Managers.

  1. Summary of total Unit Trust/Oeic and PEP sales - 1992 to 1999
  2. Sector summary - June 1999
  3. Retail gross - June 1999
  4. Retail repurchases - June 1999
  5. Retail net sales - June 1999
  6. Institutional business - gross, repurchases and net sales - June 1999
ISAs:
The ISA tables relate to accounts operated by unit trust managers only and not to accounts operated by all ISA managers.
  1. ISA sales and repurchases – June 1999
  2. ISA gross sales – June 1999
  3. ISA repurchases – June 1999
  4. ISA net sales – June 1999

Charts

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