UK savers put £5.3bn into retail funds in Q3 2020 according to figures published today by the Investment Association.
Responsible investment funds saw a net retail inflow of £975m in September with funds under management standing at £40bn at the end of the month. The sectors overall share of industry funds under management at the end of the month was 3%.
Bond funds continued to see strong net retail sales reaching £1.2bn in September, boosted by record sales of £937m in the Global Bond sector.
Active funds saw positive net retail sales of £336m in September, while net retail sales to tracker funds remained strong at £1.3bn.
Chris Cummings, chief executive of the Investment Association, said: “The year so far has seen record investment into responsible investment funds, with over £7bn invested into funds which consider their wider impact on the world. In a year clouded by uncertainty, responsible investment funds are a beacon for how savers can put their money to work to support positive change globally, and our industry can be proud that these funds are reaching new heights of popularity.
“It is also heartening that since the significant outflows in March, net retail sales have continued to recover into September. It remains to be seen just how significantly new COVID-19 restrictions and lockdowns imposed across the UK and internationally will affect investor behaviour as we head towards the end of 2020.”
Several fund managers have increased their focus on ESG investing over the past few months. Earlier this week Close Brothers Asset Management launched two new sustainable funds citing demand from advisers as the reason for the launch. AJ Bell also launched a Responsible Growth Fund this week with a focus on responsibly sourced ETFs.
Financial Planners have also been jumping on the ESG bandwagon. Last week Cheshire-based Equilibrium Financial Planning, which manages £1bn for clients, committed to invest client money only in fund groups that meet ESG criteria.