Investors withdrew £5bn from equity funds in October as concerns about the impact of Budget measures rose rapidly, according to Investment Association data.

There was a net withdrawal of £4.5bn from equity funds in October, IA data reveals.

Platform Hargreaves Lansdown, which analysed the figures, said all major global regions suffered from fund withdrawals as investors took fright.

Technology funds suffered record redemptions amid fears of an “AI bubble” and fixed income flows stalled in October as government bond selling offset demand for credit, HL said.

Kate Marshall, lead investment analyst, Hargreaves Lansdown, said there was a “clear rise” in investor caution as Budget speculation spiked.

She said: “UK retail investors pulled a net £4.5 billion from funds in October, according to the latest Investment Association data. This marks the weakest month since October 2024 and reflects a clear rise in caution as speculation around the Autumn Budget intensified.”

Global equities suffered the heaviest redemptions at £2.5 billion, while UK equity outflows accelerated to £1.4 billion.

Sentiment also turned against North America, where concerns over stretched valuations in US mega-cap technology stocks and fears of an ‘AI bubble’ contributed to £649 million in withdrawals. Technology-focused funds recorded their biggest-ever monthly outflow of £322 million.

Flows into bond funds were broadly flat at -£2 million. Investors favoured Strategic Bond, Corporate Bond and Global Emerging Markets Local Currency funds, but this was outweighed by selling in developed-market government bonds.

UK Gilt and Government Bond sectors saw a combined £548 million in outflows partly due to uncertainty about the trajectory of Bank of England rate cuts.

Mixed asset funds experienced their first outflows in a year, with £51 million withdrawn. Money market funds, which have been in demand throughout much of 2025, HL said, were broadly stable with marginal inflows of £1 million. Tracker funds saw muted activity, recording modest inflows of £306 million.

Hargreaves Lansdown Investment Data

Source: Hargreaves Lansdown 

Source: Hargreaves Lansdown