For immediate release: Wednesday 3 May 2006

QUARTERLY INVESTMENT FUND STATISTICS
FUNDS OF FUNDS, TRACKER AND ETHICAL DATA – QUARTER 1 2006

• Total investment funds under management £382 billion

• Funds under management in funds of funds £26 billion
• Net retail sales of funds of funds £889 million

• Tracker funds under management £24 billion
• Net retail sales of tracker funds -£174 million
• Ethical funds under management £4 billion
• Net retail sales of ethical funds £35 million

Funds of Funds – funds under management
Funds under management at the end of Q1 reached £26 billion, up from £23 billion at the end of the previous quarter and an increase of 68% from the same quarter in 2005.  Balanced funds accounted for the majority of funds under management, representing 69% of assets, followed by 19% in equities.

Funds of funds - sales
Total net sales were £921 million in Q1 2006, down from £1.1 billion in Q4 2005, but almost two and a half times higher than the £376 million seen in Q1 2005.

The split between sales of internally invested and externally invested funds continued the trend seen in Q4 2005, with sales being more evenly split than previous quarters. 44% of net funds of funds sales were invested internally and 56% externally, bucking the trend of previous quarters which saw externally invested sales dominate.

The most popular sectors for funds of funds gross sales in Q1 2006 were the cautious managed and balanced managed sectors.

Tracker funds
Funds under management in Q1 2006 reached almost £24 billion, an increase of 11% from Q4 and 46% from the £16 billion in Q1 2005.  Despite a retail outflow of £91 million in 2005, funds under management grew as a result of institutional inflows of £900 million and the fact that 98% of tracker funds under management were invested in equities and the FTSE World Index increased by almost 22% (in Sterling terms) in 2005.  The most popular channel for gross retail tracker sales in Q1 was the intermediary channel accounting for 37% of sales, followed by direct sales accounting for 35% of sales.

Ethical funds
Ethical funds under management in Q1 2006 increased by 11% from the previous quarter reaching £4.4 billion, an increase of 30% on the same quarter in 2005.

Richard Saunders, Chief Executive of the IMA commented:

“At almost £900 million, net retail sales of funds of funds reached an all time record level in the first quarter.  They continue to increase in popularity and are now running at about 20% of all fund sales.”   

-Ends-

Glossary

Detailed tables
1. Summary table
2. Quarterly gross retail sales by distribution channel
3. Quarterly net retail sales and net ISA/PEP sales vs FTSE 100
4. Quarterly net retail sales by asset type
5. Quarterly total net sales by client type
6. Comparative performance of £1,000 lump sum over 5, 10 and 15 years
7. Comparative performance of £50 per month savings plan over 5, 10 and 15 years
8. Summary of funds of funds unit trust/OEIC funds under management
9. Summary of funds of funds unit trust/OEIC sales
10. Funds of funds assets and sales by sector
11. Summary of tracker and ethical funds under management and sales
12. Performance of lump sum and savings plans by sector

For further information, please contact:
Mona Patel, Head of Communications, IMA,  020 7831 0898

Out of hours contact:
Mona Patel, Head of Communications, IMA, 07834 089332